TMI Blog2021 (12) TMI 925X X X X Extracts X X X X X X X X Extracts X X X X ..... nder section 80P(2)(a)(i). 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 Deduction under section 80P(2)(c) - The expression 'profits and gains' in clause (c) of sub-section (2) of section 80P of the Act is not confined to 'Profits and gains of business'. Thus, in case of co-operative credit society, income to which benefit of section 80P(2)(a)(i) is not allowed, e.g., rental income, interest income from surplus funds kept in FDs' of banks, etc., basic exemption of ͅ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 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 learned CIT (A) who confirmed the order of the AO. 5. Being aggrieved by the order of the learned CIT (A) the assessee is in appeal before us 6. The learned AR before us submitted that the authorities below have not granted the basic deduction available to a cooperative society for ₹ 50,000.00 under the provisions of section 80P(2)(c) of Act. 6.1 The ld. AR also contended that the amount of interest income from nonmembers is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 deducted under section 80P(2)(a)(i) of the Act. Thus, there remains no ambiguity that income received by the assessee on the money deposited with the bank is not eligible for deduction under section 80P(2)(a)(i) of the Act. 8.2 Now coming to the case law cited by the learned AR for the assessee, in the case of Mavilayi Service Co-operative Bank Ltd. v. CIT by the Hon'ble Supreme Court of India wherein, the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d 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 clause (b) of section 80P(2) of the Act (either independently of or in addition to all or any of the activities so specified), following deduction shall be allowed from its profits and gains attributable to such activities: (i) ₹ 1,00,000 in case of consumers' co-operative society (ii) ₹ 50,000 in any other case 8.5 The expression 'profits and gains' in clause (c) of s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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