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2024 (2) TMI 329 - AT - Income TaxEnhanced profit as eligible for deduction u/s 80P(2) - While the NFAC fully granted the deduction claimed u/s 80P(2)(a)(i) of the Act, it did not accord approval to the assessee’s claims pertaining to provisions for interest, NPA, Employee Retirement benefits, and leave encashment - assessee contended that the said interest provision is in line with accounting policies as per the Karnataka Co-operative Societies Act and even assuming that the interest provision is to be added back to the profits of the assessee, such enhanced profits should be subjected to deduction u/s 80P(2)(a)(i) HELD THAT:- The issue is squarely covered in favour of the assessee in view of the decision of the coordinate Bench of this Tribunal in case of Sharavathi Pathina Sahakara Sangha Niyamitha [2022 (8) TMI 292 - ITAT BANGALORE], wherein deduction u/s 80P(2)(a)i) of the Act on the income derived by the assessee from providing credit facilities to its members as enhanced by the sum disallowed u/s 40(a)(ia) of the Act was quashed and necessary relief to the assessee was directed. We do not find any reason to devoid from the stand taken by the Co-ordinate Bench on the identical issue itself and therefore, respectfully relaying upon the same, we allow this appeal preferred by the assessee by directing the ld. AO to grant relief on the enhanced profit as eligible for deduction u/s 80P(2) of the Act.
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