TMI Blog2015 (7) TMI 738X X X X Extracts X X X X X X X X Extracts X X X X ..... s.80P(2)(d) of the Act. The Commissioner of Income Tax (Appeals) while deciding the issue followed the Co-ordinate Bench decision in the case of M/s. SL(SPL) 151 Karkudalpatty PACCS Ltd vs. ITO [2014 (5) TMI 556 - ITAT CHENNAI ] and allowed the claim of the assessee. So, we are not in a position to reverse the findings of the Commissioner of Income Tax (Appeals) as the decision of Commissioner of Income Tax (Appeals) was based on the orders of Co-ordinate Bench which is binding on this Tribunal. - Decided against revenue. - I.T.A.No.946/Mds/2015 - - - Dated:- 17-7-2015 - Shri N.R.S. Ganesan and Shri Chandra Poojari, JJ. For the Petitioner : Shri. S. Das Gupta, IRS, JCIT. For the Respondent : None ORDER PER CHANDRA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Total 3,08,464 Interest on Investment in SDCCB 1 FD RD 26,88,872 2 Liquidity cover deposit 12,76,706 3 Reserve Fund 5,88,127 4 Savings A/c.02 28,755 5 Spl. SB 3,43,413 6 Spl. Current A/c. 3,117 7 Escrow savings A/c. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hus, out of ₹ 6,27,34,976/- invested in Salem District Central Co-operative bank 76% i.e. ₹ 4,76,78,582/- was the prorate investment made out of interest bearing funds. Total interest paid = 1,48,56,731/- = 8.2% Total deposits 18,12,36,716/- Thus, the cost of the funds invested by the assessee with Salem District Central Co-opratie bank and other co-opeatie society works out to ₹ 4,76,78,582 * 8.2% = ₹ 39,09,644/-. The net income from investment with SDDCB and other co-operative societies is ₹ 52,50,233/- - ₹ 39,09,644/- = ₹ 13,50,589/-. The Assessing Officer computed the qualifying amount eligible for 80P(2)(d) deduction is ₹ 13,40,589/-. Aggrieved the assessee preferre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ights and dividend claim, and also that the latter members are jointly and severely liable. In this backdrop, when we peruse the relevant provisions of the State Co-operative Societies Act, 1983, governing the assessee-society, it is evident from the definition of member u/s 2(16) that the same includes an associate member u/s 2(6) appended therein. In other words, the nominal members also enjoy statutory recognition as per the Act. The net result is that once the nominal members or non-voting members are themselves included in the definition of members , they satisfy the relevant condition imposed by the legislature u/s 80P(2)(a)(i). We make it clear that we are dealing with a deduction provision to be interpreted liberally. In ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not entitled for deduction under section 80P(2)(d) of the Act. On appeal, the ld. CIT(Appeals confirmed the order passed by the ld. CIT(Appeals). We find that in the case of CIT v. Kangra Co-operative Bank Ltd. [2009] 309 ITR 106 (HP), the Hon ble Himachal Pradesh High Court has considered section 80P(2)(d) of the Act. The interest earned by the assessee co-operative bank on fixed deposits with Himachal Pradesh State Co-operative Bank in compliance with the provisions of section 57 of the Himachal Pradesh Co-operative Societies Act, 1968, the income derived from banking business is eligible for deduction under section 80P(2)(a)(i) of the Act. Exemption is also available under section 80P(2)(d) of the Act. In the present case, the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. The issue before the Assessing Officer was whether the gross income or net income to be considered for deduction u/s.80P(2)(d) of the Act. The Commissioner of Income Tax (Appeals) while deciding the issue followed the Co-ordinate Bench decisions (cited supra) and allowed the claim of the assessee. So, we are not in a position to reverse the findings of the Commissioner of Income Tax (Appeals) as the decision of Commissioner of Income Tax (Appeals) was based on the orders of Co-ordinate Bench which is binding on this Tribunal. 7. Accordingly, we have no hesitation in confirming the order of the Commissioner of Income Tax (Appeals). 8. In the result, the appeal of the Revenue in ITA No.946/Mds/2015 is dismissed. Order pronounced o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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