M/S HINGULAMBIKA CO- OPERATIVE THRIFT & CREDIT SOCIETY LIMITED,PUNE vs. PRINCIPAL COMMISSIONER OF INCOME TAX, PUNE-4, PUNE

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ITA 524/PUN/2023Status: DisposedITAT Pune01 June 2023AY 2017-184 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that Section 80P(4) does not affect the eligibility of a cooperative society for deduction under Section 80P(2)(d) on interest income earned from investments/deposits with a cooperative bank.

What were the facts?

The assessee claimed deduction under Section 80P on interest income earned from deposits with Cooperative Banks, which was allowed by the AO. The Pr. CIT invoked Section 263, considering the assessment order erroneous and prejudicial to revenue.

What were the issues?

Whether interest income earned by a cooperative society from deposits with a cooperative bank is eligible for deduction under Section 80P despite the provisions of Section 80P(4).

Which sections of the Income-tax Act were involved?

Section 80P,Section 263

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCH, ‘A’ PUNE

Before: SHRI R.S. SYAL & SHRI PARTHA SARATHI CHAUDHURY

For Appellant: Shri Khushal V. Sheth &, Shri Deven A. Sheth
For Respondent: Shri Keyur Patel, CIT-DR

आदेश / ORDER

PER R.S. SYAL, VP :

1.

This appeal by the assessee is directed against the order dated 28-03-2022 passed by the Pr.CIT in National Faceless Appeal Centre (NFAC) u/s.263 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) in relation to the assessment year 2017-18.

2.

The appeal is time barred by 340 days. The assessee has filed an affidavit explaining the reasons for delay. We are satisfied with the reasons so stated. The delay in filing the appeal is, therefore, condoned and the appeal is admitted for disposal on merits.

3.

Succinctly, the facts of the case are that the assesse filed its return claiming deduction u/s.80P in respect of interest income earned from the deposits kept with Cooperative Banks, which was allowed by the AO. The ld. PCIT invoked the jurisdiction u/s 263 of the Act and disputed the allowability of the claim of deduction either u/s.80P(2)(a)(i) or u/s.80P(2)(d).

Aggrieved thereby, the assessee has come up in appeal before the Tribunal.

4.

We have heard the rival submissions and gone through the relevant material on record. The ld. PCIT has held the assessment order to be erroneous and prejudicial to the interest of the Revenue only on the ground that the claim of deduction u/s.80P on the interest income was not in order. In this regard, it is observed that though co-operative banks, other than primary agricultural credit society or a primary co-operative agricultural and rural development bank, are not eligible for deduction pursuant to insertion of section 80P(4) w.e.f. 1.4.2007, but this provision does not dent the otherwise eligibility u/s 80P(2)(d) of the Act of a co-operative society on interest income on investments/deposits parked with a co-operative bank, which is a registered co-operative society as per section 2(19) of the Act, defining co-operative society to mean a co-operative society registered under the Co-operative Societies Act, 1912 or under any law for the time being in force. Similar view has been taken by the Pune Benches of the Tribunal in several cases Vs. ACIT (ITA No.203/PUN/2019, order dated 16-11-2022).

5.

In view of the foregoing discussion, we hold that the impugned order cannot be sustained. The same is, therefore, overturned.

6.

In the result, the appeal is allowed.

Order pronounced in the Open Court on 01st June, 2023.

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