9911796707
TMI Blog2023 (10) TMI 88X X X X Extracts X X X X X X X X Extracts X X X X ..... come Tax Officer, Ward 3(5), Pune [for short 'AO']. 2. Briefly stated the facts of the case are that; 2.1 By an assessment order passed u/s 143(3) of the Act, the Ld. AO without variation had accepted the return of income filed by the assessee society declaring NIL income after a claim for deduction u/s 80P(2)(a)(i) for sum of Rs.50,24,411/- & deduction u/s 80P(2)(d) for sum of Rs.14,19,057/-. 2.2 The interest & dividend on investment claimed as deduction u/s 80P(2)(d) of the Act and allowed by the Ld. AO is held as erroneous and prejudicial to the interest of Revenue by the Ld. PCIT in his revisionary jurisdiction for the solitary reasons that interest & dividend on investment was earned from Pune District Central Co-op. Bank [for short ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r any of the above grounds of appeal." 3. We have heard rival contentions of both the parties and subject to the provisions of rule 18 of ITAT, Rules perused the material placed on record, case laws relied upon and duly considered the facts of the case in the light of settled legal position which are forewarned to learned representatives of both side. 4. At the outset we note that, the institution of present appeal is time barred by 444 days. We find merits in the submission made by the appellant in establishing sufficiency of reasons beyond delay caused in filing the present appeal. In view of Hon'ble Apex Court's decision in 'Collector Land Acquisition Vs MST Katiji and Others' reported at 167 ITR 5 (SC) and the decision of Hon'ble Bomb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... examine the taxability of interest earned on the investments made with the cooperative banks, as the same constitutes business income, rendered the assessment order erroneous. Accordingly, the Ld. PCIT issued a show cause notice dated 08.03.2022 u/s 263 calling upon the appellant society to explain as to why the assessment order dated 19.11.2019 should not be treated as erroneous and prejudicial to the interests of the revenue. In response to the show cause notice, the appellant filed a detailed submission stating that the interest income earned by the cooperative bank on the investments made with the other cooperative bank is eligible for deduction under the provisions of section 80P(2)(a)(i) as well as under the provisions of section 80P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... examined by the Co-ordinate Bench of this Tribunal in the case of M/s. Jan Kalyan Nagri Sahakari Pat. Limited Sanstha in ITA No.825/PUN/2019 for A.Y. 2014- 15 order dated 26.08.2022. The Ld. AR submits that the issue is covered in favour of the appellant. In support of this proposition, Ld. AR relied on the following judicial precedents :- (i) Nashik Road Nagari Sahkari Patsanstha Limited vs. ITO (ITA No.1700/PUN/2017 dated 27.12.2021). (ii) Rena Sahakari Sakhar Karkhana Ltd. vs. Pr.CIT (ITA No.1249/PUN/2018 dated 07.01.2022). (iii) Shri Chandraprabhu Urban Co-operative Credit Society Ltd. vs. ITO (ITA No.61 & 62/PAN/2018 dated 10.05.2022). 8. Thus, it was contended that when the issue was stands covered and decided in favour of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd that admittedly the interest income was earned from the cooperative banks, the cooperative bank is also a specie of cooperative society, therefore, the interest income earned by the cooperative society from the cooperative banks qualifies for deduction u/s 80(P)(2)(d) of the Act. Such interest 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 (supra) wherein the Tribunal held as under:- "9. We heard the rival submissions and perused the material on record. Admittedly, the appellant is a Cooperative society formed under the provisions of Maharashtra Cooperative Societies Act, 1960 with the objective of accepting deposits and lendin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or exemption u/s. 80P(2)(a)(i) of the Act. However, the Hon'ble Karnataka High Court in the case of Tumkur Merchants Souharda Credit Cooperative Ltd. Vs. ITO (2015) 230 taxmann 309 (Kar.) and the Hon'ble Telangana and Hon'ble Andhra Pradesh High Court in the case of Vaveru Co-operative Rural Bank Ltd. v CIT [(2017) 396 ITR took a view that such interest income is attributable to the activities of the society and, therefore, eligible for exemption u/s.80P(2)(a)(i) of the Act. The Coordinate Bench of Pune Benches in the case of M/s. Ratnatray Gramin Bigar Sheti Sah. Pat Sanstha Maryadit Vs. ITO (ITA Nos.559/560/PUN/2018, dated 11-12- 2018) has taken view in favour of the assessee following the judgment of Hon'ble Karnataka High Court in the c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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