TMI Blog2023 (4) TMI 796X X X X Extracts X X X X X X X X Extracts X X X X ..... of this Tribunal in the case of Tulsiani Chambers Premises Co-operative Society Ltd [ 2022 (5) TMI 548 - ITAT MUMBAI] which are reproduced hereinabove, we hold that assessee society would be entitled for deduction u/s.80P(2)(d) of the Act in respect of interest received from co-operative banks. Accordingly, the ground raised by the assessee on this issue is allowed. - ITA No.3285/Mum/2022 And ITA No.3269/Mum/2022 - - - Dated:- 24-2-2023 - Shri M.Balaganesh, Accountant Member And Shri Sandeep Singh Karhail, Judicial Member For the Assessee : Shri Ashok Rao For the Revenue : Shri Rajeev Kumar Singh ORDER PER M. BALAGANESH (A.M): These appeals in ITA No.3285/Mum/2022 3269/Mum/2022 for A.Y.2020-21 2021-22 arises out of the order by the ld. Commissioner of Income Tax (Appeals)-National Faceless Appeal Centre in appeal No. NFAC/2019-20/10176411 NFAC/2020-21/10176414 dated 20/12/2022 14/12/2022 respectively (ld. CIT(A) in short) against the order of assessment passed u/s.143(1) of the Income Tax Act, 1961 (hereinafter referred to as Act) dated 24/12/2021 30/09/2022 respectively by the ld. DCIT/ACIT, CPC-Bangalore (hereinafter referred to as ld. AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under:- 2. We heard the rival submissions and perused the material on record. The sole matrix of the disputed issue emphasized by the Ld.AR in respect of granting of deduction u/s 80P(2)(d) of the Act to the Cooperative Society. The Ld. AR submitted that the interest income derived by a co-operative society from its deposits with the co-operative bank would be entitled for deduction U/sec80P(2)(d) of the Act. Further the co-operative bank pursuant to insertion of sub section (4) to sec80P of the Act would no more be entitled for claim of deduction U/sec80P of the Act but the co-operative bank continues to be a co-operative society registered under the Co-operative Societies Act. The Ld.AR has demonstrated the facts of earning of interest on fixed deposits and utilization.The Ld.AR has supported the submissions relying on the judicial decisions as under: 1. Petit Towers CHS Vs. ITO, ITA No. 549/Mum/2021. 2. Solitaire CHS Ltd Vs. PCIT, ITA No. 3155/Mum/2019 3. Land End CHS Ltd Vs. ITO, ITA No. 3566/Mum/2014 4. Sea Green CHS Ltd Vs. ITO, ITA No. 1343/Mum/2017 5. Merwanjee Cama Park CHS Ltd Vs. ITO ITA No. 6139/Mum/2014 6. Kaliandas Udoy Bhavan Premi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i in the case of M/s Solitaire CHS Ltd, Vs. Pr.CIT-26, Mumbai ITA No.3155/Mum/2019, dated 29.11.2019, wherein the Tribunal had observed as under : 6. We have heard the authorised representatives for both the parties, perused the orders of the lower authorities and the material available on record, as well as the judicial pronouncements relied upon by them. Our indulgence in the present appeal has been sought, for adjudicating, as to whether the claim of the assessee for deduction under section 80P(2)(d) in respect of interest income earned from the investments/deposits made with the co-operative banks is in order, or not. In our considered view, the issue involved in the present appeal revolves around the adjudication of the scope and gamut of sub-section (4) of Sec. 80P as had been made available on the statute, vide the Finance Act 2006, with effect from 01.04.2007. On a perusal of the order passed by 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 amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ricultural credit society or a primary co- operative agricultural and rural development bank. However, at the same time, we are unable to subscribe to his view that the aforesaid amendment would jeopardize the claim of deduction of a co-operative society under Sec. 80P(2)(d) in respect of its interest income on investments/deposits parked with a co-operative bank. In our considered view, as long as it is proved that the interest income is being derived by a co-operative society from its investments made with any other co-operative society, the claim of deduction under the aforesaid statutory provision, viz. Sec. 80P(2)(d) would be duly available. We find that the term cooperative society‟ had been defined under Sec. 2(19) of the Act, as under:- (19) Co-operative society means a cooperative society registered under the Cooperative 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 co-operative banks pursuant to the insertion of subsection (4) to Sec. 80P would no more be entitled for claim of deduction under Sec. 80P of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case was in context of Sec. 80P(2)(a)(i), and not on the entitlement of a co-operative society towards deduction under Sec. 80P(2)(d) on the interest income on the investments/deposits parked with a co-operative bank. Although, in all fairness, we may herein observe that the Hon'ble High Court of Karnataka in the case of Pr. CIT Vs. Totagars co-operative Sale Society (2017) 395 ITR 611 (Karn), had concluded that a co-operative society would not be entitled to claim of deduction under Sec. 80P(2)(d). At the same time, we find, that 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 Hon‟ble High Court of Gujarat in the case of State Bank Of India Vs. CIT (2016) 389 ITR 578 (Guj), had observed, that the interest income earned by a co-operative society on its investments held with a cooperative bank would be eligible for claim of deduction under Sec.80P(2)(d) of the Act. We find that as held by the Hon'ble High Court of Bombay in the case of K. Subramanian and Anr. Vs. Siemens India Ltd. and Anr (1985) 156 ITR 11 (Bom), where there is a conflict between the decis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rroneous in so far it was prejudicial to the interest of the revenue. 10. Accordingly, on the basis of our aforesaid observations, we herein not finding favor with the view taken by the Pr. CIT that the order passed by the A.O u/s 143(3), dated 31.08.2017 was erroneous in so far it was prejudicial to the interest of the revenue within the meaning of Sec. 263 of the Act set-aside the same and restore the order passed by the A.O u/s 143(3) of the Act, dated 31.08.2017. 9. Considering the facts, circumstances and the ratio of the judicial decisions. We find the Honble Tribunal has passed the order in the context of the revision order U/sec263 of the Act and relied on the catena of Honble High court and Tribunal decisions were the co- operative society receives/earns interest on deposits with the co-operative bank is eligible for claim of deduction under section 80(2)(d) of the Act. The Ld.AR emphatically substantiated the submissions with the facts, evidences and judicial decisions filed before the lower authorities and find merits in the arguments of the Ld.AR. Accordingly, we set aside the order of the CIT(A) and direct the Assessing officer to allow the claim of deduction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r cooperative banks or cooperative societies which are carrying on banking business but not registered with RBI, they would be entitled for deduction u/s.80P(2)(a)(i) of the Act and would not be hit by the provisions of Section 80P(4) of the Act. The Hon ble Supreme Court had taken cognizance of the CBDT Circular dated 28/12/2006 containing the explanatory notes on provisions contained in the Finance Act 2006 and the CBDT clarification dated 09/05/2008 while laying down the aforesaid proposition. The fact of co-operative societies investing in co-operative banks were never disturbed by this decision. Hence, we hold that the reliance placed by the ld. DR on the aforesaid decision of the Hon ble Supreme Court would not advance the case of the Revenue as they are factually distinguishable. Accordingly, by placing reliance on the co-ordinate Bench decision of this Tribunal in the case of Tulsiani Chambers Premises Co-operative Society Ltd vs ITO in ITA Nos.2459-2462/Mum/2021 dated 18/04/2022 which are reproduced hereinabove, we hold that assessee society would be entitled for deduction u/s.80P(2)(d) of the Act in respect of interest received from co-operative banks. Accordingly, the gr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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