ASHTAVINAYAK NAGRI SAHKARI PAT SANSTHA MARYADIT,AMRAVATI vs. INCOME TAX OFFICER-WARD 1, AMRAVATI

Whether the Ld-CIT appeals is correct in law and on facts in not following the order of Hon'ble Income Tax Appellate Tribunal Nagpur in Appellants own case for subsequent year i.e. A.Y. 2014-15 as well as the judgements of Coordinate Pune Bench relied on by appellant wherein the deduction u/s. 80P(2)(a) on interest income received from nationalised banks arefully allowed circumstances of the case. identical facts on and circumstances of the case.

Whether the action of the Ld-CIT appeals is not contrary to the settled principles of consistency as laid down by Honorable Supreme court in the case of Radhasaomi Satsang

Whether the Ld-CIT appeals is correct in law and on facts in sustaining the disallowance of the deduction of Rs. 6, 49, (487 / (- u)) / s 80P(2)(a) in respect of the interest income received from nationalised banks inspite of being observed that the appellant is a credit co-operative society fully engaged in the business of providing credit facilities to its members and the interest income earned from nationalised banks were part of its business activity and were inextricably linked to its banking/credit operations.

The Ld CIT-appeals erred in placing reliance on the judgement of the Honorable supreme court in the Totgars co-operative sales society Vs ITO without appreciating that the facts of appellants case are materially distinguishable from the facts before the Hon'ble Supreme Court and deduction of interest income from nationalised bank is also by the ITAT, CIT-appeals and ITO in the preceding and succeeding years in assessee's own case.

Whether the Ld CIT-appeals is correct in law and on facts without bringing any adverse material on record to establish that the appellant is not entitled to deduction u/s. 80P of the income tax act.

The appellant craves to leave to add, amend, alter, modify or delete any of the grounds of appeal at or before the time of hearing.

The only issue for consideration is disallowance u/s 80P(2) of the Act for the interest income earned from institutes other than Co-operative

I have heard rival contentions and perused the record placed before me. I observe that the assessee is a credit co-operative society and declared ‘NIL’ income in the return for A.Y. 2013-14 E-filed on 30.09.2013. During the year assessee has earned interest income of Rs. 6,49,487/- earned on short term deposits with the banks other than the co-operative banks and the same have been assessed as income from other sources by Ld. Assessing Officer (AO). Assessee failed to get any relief from Ld. CIT(A). Before this Tribunal assessee has referred to judicial precedents and taking note of the same I find that the case of the assessee is squarely covered by the decision of this Tribunal in the case of Ashtavinayak Nagrik Sahakari Pat Sanstha Maryadit Vs. ITO (ITA No. 50/NAG/2023, dated 06.04.2024) where it has been held that in case of Credit Co- operative Societies the interest income earned out of investments held with banks including co-operative banks, for commercial and business expediency and also to adhere to the liquidity norms, are also eligible for deduction u/s 80P(2)(a)(i) of the Act. In absence of any binding judicial precedent referred by Ld. Sr. Departmental Representative (DR), the claim of the assessee u/s 80P(2) at Rs. 6,49,487/- is hereby allowed. Effective grounds of appeal raised by the assessee are allowed.

In the result, the appeal of the assessee is allowed.