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2024 (4) TMI 795 - AT - Income TaxEligibility of Deduction u/s 80P - bank interest earned from cooperative banks - Assessee is a co-operative society primarily engaged into arranging for prompt payment to beneficiaries of diseased employees - HELD THAT:- The income earned by a co-operative society by way of interest derived by from its investment with any other cooperative society, then the whole of such income is deductible. Further the amount of interest received by the assessee from the different cooperative banks; it is not the claim that those banks are also not cooperative societies. It is agreed that those are also the cooperative bank in terms of The Banking Regulation Act, 1949. Therefore even if it is accepted that bank interest on from cooperative banks by the assessee is not the income from the business of the assessee and therefore the claim of the assessee fails under section 80P(2)(a) of the act, but the claim is still allowable and therefore cannot be denied u/s 80P(2)(d) of the act. This issue is also covered in favour of the assessee by the decision of Kerala State Co-Operative Agricultural & Rural Development Bank Ltd. [2023 (9) TMI 761 - SUPREME COURT] where the deduction was allowable to the state level agricultural and rural development bank, was engaged in providing credit facility to its members . The case of the assessee is on far better footings that these are society of only the employees of Indian oil Corporation. In view of the above facts, we direct the learned lower authorities to allow the deduction to the assessee on interest income earned from various cooperative banks under section 80P(2)(d) of the act. - Appeals of the assessee are allowed.
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