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2022 (9) TMI 720 - AT - Income TaxRevision u/s 263 by CIT - Deduction u/s 80P(2)(d) - whether AO made sufficient enquiries at the time of original assessment and whether the view taken by the AO on appreciation of facts of the case is a legally sustainable view? - HELD THAT:- Aassessee filed reply before the AO, in which the assessee gave a detailed explanation regarding the claim of deduction under section 80-P of the Act. Therefore, from the perusal of records, it is evident that the AO had made sufficient enquiry into the aspect of claim of deduction under section 80-P of the Act. Regarding the disallowance of dividend income earned on shares held by the assessee in RDC District Cooperative Bank, we observe that the Hon’ble Gujarat High Court in the case of State Bank of India [2016 (7) TMI 516 - GUJARAT HIGH COURT] held that the interest income earned by a co-operative society on its investments held with a co-operative bank would be eligible for claim of deduction under Sec.80P(2)(d) . In the case of Pr. Commissioner of Income Tax and Anr. Vs. Totagars Cooperative Sale Society [2017 (1) TMI 1100 - KARNATAKA HIGH COURT] the Karnataka High Court has held that the interest income earned by a co-operative society on its investments held with a co-operative bank would be eligible for claim of deduction under Sec.80P(2)(d) of the Act. We are of the considered view that AO had made sufficient enquiries at time of passing of original assessment order. The assessee had given to the replies in response to the queries raised by the AO. Before us, the assessee has also duly explained that in that no interest was earned by the assessee from any bank, but such interest received from its members only. Further, the assessee had earned dividend income on account of shares held in Rajkot District Cooperative Bank, on which deduction has been claimed under section 80P of the Act, which is eligible in view of the plain language of section 80P(d). Therefore, we are of the view that in the instant set of facts, there is no infirmity in the order assessment passed by the AO. Accordingly, order passed under section 263 of the Act is liable to be set aside - Appeal of assessee allowed.
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