TMI Blog2019 (7) TMI 1219X X X X Extracts X X X X X X X X Extracts X X X X ..... providing credit facilities to members or marketing agricultural produce to members is not business income but income from other sources and the society is not entitled to special deduction. Therefore whether the source of funds were Assessee's own funds or out of liability was not subject matter of the decision of the Hon'ble Karnataka High Court in the decision cited by the learned DR. To this extent the decision of the Hon'ble Karnataka High Court in the case of Tumukur Merchants Souharda Co-operative Ltd. ( [ 2015 (2) TMI 995 - KARNATAKA HIGH COURT] still holds good. Hence, on this aspect, the issue should be restored back to the AO for a fresh decision after examining the facts in the light of these judgment of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the interest earned on FDs with Bank amounting to ₹ 82,98,469/- under the head Income from Other Sources . On appeal, the CIT(A)-7, Bangalore, dismissed the assessee s appeal vide the impugned order dated 10.10.2018 and directed the AO to adopt the figure of interest earned on FDs by the assessee at ₹ 1,00,31,837/- as against ₹ 82,98,469/- adopted by the AO. 3. Aggrieved by the order of the CIT(A)-7, Bangalore, dated 10.10.2018 for Assessment Year 2014-15, the assessee has preferred this appeal before the Tribunal wherein it has raised the following grounds:- 1. The ld. CIT (A) erred in passing the order in the manner which he did. 2. On the facts, the learned CIT (A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unds that may be urged at the time of hearing of the appeal the appellant prays that the appeal may be allowed. 4. The issues that arise for consideration in this appeal by the assessee are as to whether the Revenue authorities were justified in holding that the assessee was not entitled to the benefit of deduction under section 80P(2)(a)(i) of the Income Tax Act, 1961 (in short the Act ) on interest income earned and under section 80P(2)(d) of the Act in respect of interest received from Co-operative institutions. The Assessing Officer (AO) denied the claim of the assessee on the ground that interest income earned by making investment of surplus funds has to be assessed under the head Income from Other Sources and not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee, the Assessment Years involved was Assessment Years 1991-92 to 1999-2000. The nature of interest income for all the Assessment Years was identical. The bone of contention of the Assessee in AY 2007-08 to 2011-12 was that the deduction under Section 80P(2) of the Act is claimed by the respondent assessee under Section 80P(2)(d) of the Act and not under Section 80P(2)(a) of the Act which was the claim in AY 1991-92 to 1999- 2000. The reason given by the Assessee was that in AY 2007-08 to 2011-12 investments and deposits after the Supreme Court's decision against the assessee Totgar's Co-operative Sale Society Ltd. (supra), were shifted from Schedule Banks to Cooperative Bank. U/s.80P(2)(d) of the Act, income by way of interest o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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