TMI Blog2023 (4) TMI 39X X X X Extracts X X X X X X X X Extracts X X X X ..... enue : Shri Keyur Patel, CIT-DR ORDER PER SATBEER SINGH GODARA, JM : This assessee s appeal for assessment year 2012-13, arises against the PCIT, Pune-1, Pune s Din Order No. ITBA/ REV/ F/REV5/2022-23/1048934017(1), dated 19.01.2023, involving proceedings u/sec.143(3) of the Income Tax Act, 1961 (in short the Act ). Heard both the parties. Case file perused. 2. It emerges during the course of hearing that the assessee s instant appeal hardly requires us to delve into the relevant factual matrix at length. This is for the precise reason that the learned PCIT s impugned revision directions herein term the Assessing Officer s regular assessment dated 18.02.2021 in issue as an erroneous one causing prejudice to interest of the revenue to the extent he had allowed this taxpayer s section 80P deduction claim of Rs.15,00,780/- representing interest derived from deposits made in cooperative banks as entitled for the said relief. 3. Both the learned representatives vehemently reiterated their respective stands. The revenue more particularly supported the learned PCIT s revision directions in light of hon ble Karnataka high court s decision in Tumkur Merchants Sou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ulated time period. Our attention was drawn towards the affidavit‟ of the assessee society wherein the aforesaid facts were deposed. On the basis of the aforesaid facts, it was submitted by the ld. A.R that the delay involved in filing of the present appeal in all fairness may be condoned. Per contra, the ld. D.R did not object to the seeking of condonation of the delay in filing of the appeal by the assessee society. After giving a thoughtful consideration, we are of the considered view, that as there were justifiable reasons leading to delay on the part of the assessee in filing of the present appeal before us, therefore, the same merits to be condoned. 5. On merits, it was submitted by the ld. A.R, that as the A.O while framing the assessment had after making necessary verifications taken a plausible view, therefore, the Pr. CIT had exceeded his jurisdiction by seeking to review the order passed by him in the garb of the revisional powers vested with him under Sec.263 of the Act. It was submitted by the ld. A.R, that the issue as regards the eligibility of the assessee for claim of deduction under Sec.80P(2)(d) on interest income derived from investments/deposits lyi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Pr. CIT under Sec. 263 of the Act, we find, that he was of the view that pursuant to insertion of sub-section (4) of Sec. 80P, the assessee would no more be entitled for claim of deduction under Sec. 80P(2)(d) in respect of the interest income that was earned on the amounts which were parked as investments/deposits with the cooperative bank, other than a Primary Agricultural Credit Society or a Primary Co-operative Agricultural and Rural Development Bank. Observing, that the co-operative banks from where the assessee was in receipt of interest income were not cooperative societies, the Pr. CIT was of the view that the interest income earned on such investments/deposits would not be eligible for deduction under Sec. 80P(2)(d) of the Act. 8. After necessary deliberations, we are unable to persuade ourselves to concur with the view taken by the Pr. CIT. Before proceeding any further, we may herein cull out the relevant extract of the aforesaid statutory provision, viz. Sec. 80P(2)(d), as the same would have a strong bearing on the adjudication of the issue before us. 80P(2)(d)(1). Where in the case of an assessee being a co-operative society, the gross total incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iety registered under the Co-operative Societies Act, 1912 (2 of 1912), or under any other law for the time being in force in any state for the registration of co-operative societies; We are of the considered view, that though the cooperative banks pursuant to the insertion of sub-section (4) to Sec. 80P would no more be entitled for claim of deduction under Sec. 80P of the Act, but as a cooperative bank continues to be a co-operative society registered under the Co-operative Societies Act, 1912 (2 of 1912), or under any other law for the time being in force in any State for the registration of co-operative societies, therefore, the interest income derived by a co-operative society from its investments held with a co-operative bank would be entitled for claim of deduction under Sec.80P(2)(d) of the Act. 9. In so far the judicial pronouncements that have been relied upon by the ld. A.R are concerned, we find that the issue that a co-operative society would be entitled for claim of deduction under Sec. 80P(2)(d) on the interest income derived from its investments held with a co-operative bank is covered in favour of the assessee in the following cases: (i). M/s Solita ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e High Court of jurisdiction, we respectfully follow the view taken by the Hon'ble High Court of Karnataka in the case of Pr. Commissioner of Income Tax and Anr. Vs. Totagars Cooperative Sale Society (2017) 392 ITR 74 (Karn) and that of the Hon ble High Court of Gujarat in the case of State Bank Of India Vs. CIT (2016) 389 ITR 578 (Guj), wherein it was observed that the interest income earned by a co-operative society on its investments held with a co-operative bank would be eligible for claim of deduction under Sec.80P(2)(d) of the Act. 10. Be that as it may, in our considered view, as the A.O while framing the assessment had taken a possible view, and allowed the assessee‟s claim for deduction under Sec. 80P(2)(d) on the interest income earned on its investments/deposits with co-operative banks, therefore, the Pr. CIT was in error in exercising his revisional jurisdiction u/s 263 of the Act for dislodging the same. Accordingly, finding no justification on the part of the Pr. CIT, who in exercise of his powers under Sec. 263 of the Act, had dislodged the view that was taken by the A.O as regards the eligibility of the assessee towards claim of deduction under Sec. 8 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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