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2019 (2) TMI 1205 - ITAT PUNEDenying deduction u/s 80P(2)(a) in respect of interest received - assessee had advanced loan to its members, who in turn, had authorized the employer i.e. Ghatge Patil Group of Companies to deduct installments and interest due from their salaries and remit the same to Co-operative Society - HELD THAT:- There was default in such remittances and various cases were filed. As per directions of the District Deputy Registrar, Co-operative Societies, Kolhapur, the assessee not only received installments but also received interest. During the year, it had received interest of ₹ 23,74,646/- and the question was that such interest was received during the course of carrying on its activity of providing credit facilities to its members and hence, deductible under section 80P(2)(a)(i) of the Act. We find merit in the plea of assessee in this regard. The interest became due to the assessee from Ghatge Patil Group of companies, since it had failed to remit the amount of installments deducted by it along with interest to the Co-operative Society of the employees of the said concern. Section 49(3) of the Maharashtra Co-operative Societies Act postulates that the employers of members were mandatorily part of the main activity of the assessee society i.e. providing credit facilities to its members. Once the amount is received from the entity which was part of the main activity of the Co-operative Society, then the same is received during the course of carrying on the business activity and hence, eligible for claim of deduction under section 80P(2)(a)(i) - Decided in favour of assessee.
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