TMI Blog2023 (5) TMI 161X X X X Extracts X X X X X X X X Extracts X X X X ..... est also qualifies for exemption u/s 80P(2)(a)(i) as held by the Co-ordinate Bench of Pune Tribunal in the case of Nashik Road Nagari Sahkari Patsanstha Limited [ 2021 (12) TMI 1259 - ITAT PUNE ] Decided in favour of assessee. - I.T.A.No.325/PUN./2023 - - - Dated:- 2-5-2023 - Shri Satbeer Singh Godara, Judicial Member And Dr. Dipak P. Ripote, Accountant Member For the Assessee : Shri Pramod S Shingte For the Revenue : Shri Sardar Singh Meena ORDER PER SATBEER SINGH GODARA, J.M. : This assessee s appeal for assessment year 2018-2019, arises against the Pr.CIT, Pune-4, Pune s Din and Order No ITBA/REV/F/REV5/2022-23/1050510946(1)/13746, dated 08.03.2023, involving proceedings u/s. 143(3) of the Income Tax Act, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... formed under the Maharashtra Co-operative Societies Act, 1960. It is engaged in the business of accepting deposits from members and providing credit facilities to its members. The original Return of Income for the assessment year 2017-18 was filed on 18.10.2017 disclosing total income of Rs.3,11,740/-. Subsequently, the assessee revised the return of income declaring Rs.Nil income after claiming deduction of Rs.6,32,86,382/- under the provisions of section 80P of the Income Tax Act, 1961 ( the Act ). Against the said return of income, the assessment was completed by the Assessing Officer accepting the returned income vide order dated 19.11.2019 passed u/s 143(3) of the Act. 4. Subsequently, on examination of the assessment order, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aim of exemption after due application of mind on the issue in appeal and, therefore, the Explanation 2 to section 263 cannot be invoked. However, the ld. PCIT on due consideration of explanation filed by the appellant held that the failure of the Assessing Officer to examine the issue rendered the assessment erroneous and prejudicial to the interests of the revenue. Accordingly, ld. PCIT set aside the assessment order with a direction to examine the assessee s claim of deduction u/s 80P(2)(a)(i) as well as interest of Rs.19,88,77,712/- u/s 80P(2)(d) after affording reasonable opportunity of being heard to the appellant. 6. Being aggrieved, the appellant is in appeal before us in the present appeal. 7. The ld. AR submits that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the validity of assumption of jurisdiction u/s 263 by the ld. PCIT. The Parliament had conferred the power of revision on the Commissioner of Income Tax u/s 263 of the Act in case the assessment order passed is erroneous and prejudicial to the interests of revenue. In order to invoke the power of revision, the above two conditions are required to be satisfied cumulatively. References in this regard can be made to the decision of the Hon ble Supreme Court in the case of Malabar Industrial Co. Ltd. vs. CIT, 243 ITR 83 (SC) and in the case of CIT vs. Max India Ltd., 295 ITR 282 (SC). The error in the assessment order should be one that it is not debatable or plausible view. In a case where the Assessing Officer examined the claim, took one ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for exemption u/s. 80P(2)(a)(i) of the Act. The Hon ble Punjab Haryana High Court in the case of CIT vs. Punjab State Cooperative Federation of Housing Building Societies Ltd. 11 taxmann.com 448, the Hon ble Gujarat High Court in the case of State Bank of India Vs. CIT 389 ITR 578 (Guj.), the Hon ble Delhi High Court in the case of Mantola Co-operative Thrift Credit Society Ltd. Vs. CIT 50 taxmann.com 278, the Hon ble Punjab Haryana High Court in the case of CIT Vs. Punjab State Cooperative Agricultural Development Bank Ltd. 389 ITR 68 and the Hon ble Kolkata High Court in the case of CIT Vs. Southern Eastern Employees Cooperative Credit Society Ltd. 390 ITR 524 took a view that the income arising on the surplus invested in short ter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revision passed by the ld. PCIT u/s 263 of the Act cannot be sustained in the eyes of law. Hence, the grounds of appeal raised by the assessee stand allowed. 5. Learned CIT-DR could also not dispute that the hon ble jurisdictional high court s latest decision [2023] 149 taxmann.com 94 (Bom.) Mumbai Postal Employees Co.Op Credit Society Ltd., vs. ITO has already rejected the Revenue s identical stand in initiating sec.148 proceedings for the purpose of assessing similar interest income derived from co-operative banks and other institutions. 6. We adopt the foregoing detailed discussion mutatis mutandis to accept the assessee s arguments. Learned PCIT s revision directions in issue stand reversed. The Assessing Officer s corresponding ..... X X X X Extracts X X X X X X X X Extracts X X X X
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