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2021 (9) TMI 235 - AT - Income TaxDeduction claimed by the cooperative society u/s 80P(2)(a)(i) - assessee is having nominal/associate members and accordingly took the view that the assessee has violated the principles of mutuality - HELD THAT:- Since the issue of deduction u/s 80P(2)(a)(i) of the Act requires fresh examination in the light of decision rendered by Hon’ble Supreme Court in the case of Mavilayi Service Co-operative Bank Ltd. [2021 (1) TMI 488 - SUPREME COURT], we set aside the order passed by Ld. CIT(A) on this issue and restore the same to the file of the A.O for examining it afresh as discussed above. Deduction claimed u/s 80P(2)(d) - interest earned on deposits kept as SLR - A.R. submitted that the assessee is required to maintain deposits with banks to meet the requirement of Statutory liquidity ratio (SLR), which is 28% of total deposits and since these deposits have been made under legal obligation, it is incidental activity of business intricately connected with the main business of providing credit to the members - HELD THAT:- An identical issue was restored to the file of the A.O. by the coordinate bench in the case of Thannirupantha Primary Agricultural Credit Co-operative Society Ltd. [2021 (8) TMI 68 - ITAT BANGALORE] - Following the above said decision we restore this issue to the file of the A.O. for examining it afresh in the light of discussions made. Alternative claim that the expenses incurred to earn the interest income should be allowed u/s 57(iii) of the Act, if it claim for deduction u/s 80P(2)(a)(i) or 80P(2)(d) is not allowed - Since we have already restored the issue of claim of deduction u/s 80P(2)(d) of the Act, we restore this alternative contention also to the file of the A.O., since the claim of the assessee gets support from the decision rendered by Hon’ble High Court of Karnataka in the case of Totgars Co-operative Sales Society Ltd [2017 (7) TMI 1049 - KARNATAKA HIGH COURT]
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