9911796707
TMI Blog2021 (12) TMI 925X X X X Extracts X X X X X X X X Extracts X X X X ..... ant to the Assessment Year 2016-17. 2. The only interconnected issue raised by the assessee is that the learned CITA erred in confirming the order of the AO in part by disallowing the deduction of Rs. 17,467.00 claimed under the provisions of section 80P(2)(a)(i) of the Act. 3. The AO during the assessment proceedings found that the assessee has shown interest income amounting to Rs. 17,467.00 which was received from the nonmembers i.e. interest on saving bank. As per the AO the impugned income is not eligible for deduction under section 80P(2)(a)(i) of the Act which was so claimed by the assessee. Accordingly, the AO disallowed the same and added to the total income of the assessee. 4. Aggrieved assessee preferred an appeal to the learn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Hon'ble Gujarat High Court in the case of State Bank of India versus CIT reported in 72 Taxmann.com 64 wherein it was held as under: The Income Tax Appellate Tribunal was also justified in holding that interest income of Rs. 16,14,579/- and Rs. 32,83,410/-respectively on deposits placed with State Bank of India was not exempt under section 80P(2)(a)(i) of the Income Tax Act, 1961. 8.1 In view of the above, it is only the interest derived from the credit provided to its members which is deductible under section 80P(2)(a)(i) of the Act and the interest derived by depositing surplus funds with the State Bank of India is not being attributable to the business as envisaged under the provisions of the Act. Thus the same cannot be deduct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntained in section 80P(2)(a)(i), notwithstanding that they may also be giving loans to their members which are not related to agriculture. Also, in case it is found that there are instances of loans being given to non-members, profits attributable to such loans obviously cannot be deducted." 8.3 Thus, the profits and gains attributable to non-members arising as a result of advancement of loans was held to be not an allowable deduction under Section 80P(2)(a)(i) of the Act. In view of the above, we do not find any merits in the argument advanced by the learned counsel for the assessee. 8.4 The provisions of section 80P(2)(c) of the Act, provides that a co-operative society engaged in activities other than those specified in clause (a) or c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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