TMI Blog2022 (3) TMI 721X X X X Extracts X X X X X X X X Extracts X X X X ..... rs, the whole of the amount of profits and gains of business attributable to such activities shall be deductible in the computation of total income. The claim of assessee for deduction has been negated by the authorities below, inter alia, on the ground that it admitted certain Members, described as Nominal Members , who were neither entitled to dividend nor voting rights. It is relevant to note that the term Member has been defined u/s 2(19) in the Maharashtra Act to mean: a person joining in an application for the registration of a Co-operative society which is subsequently registered, or a person duly admitted to membership of a society after registration and includes a nominal, associate or sympathizer member . On going through th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ooperative Ltd. [ 2015 (2) TMI 995 - KARNATAKA HIGH COURT ] allowing the deduction u/s. 80P on interest income and the Hon ble Delhi High Court in Mantola Cooperative Thrift Credit Society Ltd. [ 2014 (9) TMI 833 - DELHI HIGH COURT ] not allowing deduction u/s.80P on interest income, earned from banks under similar circumstances. Both the Hon ble High Courts have taken into consideration the ratio laid down in the case of Totgar s Cooperative Sale Society Ltd. [ 2010 (2) TMI 3 - SUPREME COURT ] There being no direct judgment from the Hon ble jurisdictional High Court on the point, the Tribunal in Shri Laxmi Narayan Nagari Sahakari Pat Sanstha Maryadit [ 2015 (8) TMI 1085 - ITAT PUNE ] preferred to go with the view taken in favour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t echoed in the first appeal. 4. I have heard both the sides and gone through the relevant material on record. The assessee Co-operative society is admittedly engaged in carrying on the business of banking and providing credit facilities. Section 80P(2)(a)(i) provides that in the case of co-operative society engaged in carrying on the business of banking or providing credit facilities to its members, the whole of the amount of profits and gains of business attributable to such activities shall be deductible in the computation of total income. The claim of assessee for deduction has been negated by the authorities below, inter alia, on the ground that it admitted certain Members, described as Nominal Members , who were neither entitled ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, the Hon'ble Supreme Court in Mavilayi Service (supra) held that the interest on loans given to Nominal Members under the Kerala Act was eligible u/s 80P(2)(a)(i) of the Act as the term Member under the Kerala Act included Nominal Members . In view of the foregoing discussion, it is evident that when the loans are given to Nominal Members and the relevant State Act includes, Nominal Member within the purview of Member , there can be no question of denial of benefit u/s 80P(2)(a)(i). The Hon ble jurisdictional High Court in Jalgaon District Central Co-operative Bank Ltd. VS. Union of India (2004) 134 Taxman 1 (Bom) has held that the definition of `Member given in section 2(19) of the Maharashtra Act takes within its sweep ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere being no direct judgment from the Hon ble jurisdictional High Court on the point, the Tribunal in Shri Laxmi Narayan Nagari Sahakari Pat Sanstha Maryadit ( supra ) preferred to go with the view taken in favour of the assessee by the Hon ble Karnataka High Court in the case of Tumkur Merchants Souharda Credit Cooperative Ltd. (supra). 7. In the absence of there being any change in the legal position prevailing on this issue and respectfully following the view taken by the Pune Bench of the Tribunal in ITO Vs. Sureshdada Jain Nagri Sahakari Patsanstha ( supra ) and host of other orders reiterating the similar view, I set-aside the impugned order and direct to grant the deduction. 8. In the result, the appeal is allowed. Ord ..... X X X X Extracts X X X X X X X X Extracts X X X X
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