SURATHKAL VYAVASAYA SEVA SAHAKARI BANK NIYAMITHA,MANGALORE vs. INCOME TAX OFFICER, WARD-1(1),, MANGALORE

ITA 2299/BANG/2025Status: DisposedITAT Bangalore11 May 2026AY 2020-2111 pages
AI SummaryRemanded

What were the facts?

The assessee, a co-operative society, claimed deduction under Section 80P(2) of the Income Tax Act. The Assessing Officer (AO) disallowed part of the deduction, citing the Apex Court's decision in Citizen Co-operative Society Ltd. and the assessee's dealings with members and non-members, including nominal members.

What did the Tribunal hold?

The Tribunal held that the Citizen Co-operative Society Ltd. judgment was not applicable as the assessee was registered under the Karnataka Co-operative Societies Act, not the Mutually Aided Co-operative Societies Act. It also considered the nature of interest income from investments in co-operative banks and mandatory deposits with BESCOM.

What were the issues?

The primary issue was the eligibility of the co-operative society for deduction under Section 80P(2) in light of the Citizen Co-operative Society Ltd. judgment and the AO's findings on dealings with members and non-members, as well as the taxability of interest income from investments and mandatory deposits.

Which sections of the Income-tax Act were involved?

Section 80P(2)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH : BANGALORE

Before: SHRI PRASHANT MAHARISHI & SHRI SOUNDARARAJAN K.

For Respondent: Shri Subramanian .S, JCIT-DR

PER SOUNDARARAJAN K., JUDICIAL MEMBER

These are the appeals filed by the assessee challenging the separate orders of the NFAC, Delhi all dated 14/08/2025 in respect of the A.Ys. 2017-18, 2018-19 and 2020-21. The appeal related to the assessment year 2017-18 is taken as a lead case since the issues are common in all the three years and therefore the facts of the assessment year 2017-18 is given as ITA Nos. 2297 to 2299/Bang/2025 follows. The decision arrived in appeal ITA No.2297/Bang/2025 would mutatis mutandis apply to the other assessment years.

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