PUNE ZILLA SHIKSHAN MANDAL SEVAK SAHAKARIPATSANSTHA MARYADIT,PUNE vs. ACIT, CIRCLE-3, PUNE, PUNE

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “B”, PUNE BEFORE SHRI R. K. PANDA, VICE PRESIDENT AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA Nos.1534, 1535 & 1536/PUN/2026 िनधा�रण वष� / Assessment Years : 2017-18, 2018-19 & 2020-21 Pune Zilla Shikshan Mandal Vs. ACIT, Circle-3, Pune. Sevak Sahakari Patsanstha Maryadit, 48/1A, Earandwana, Ex Service Man Colony, Paudraod, Pune- 411038. PAN : AAAJP0302N Appellant Respondent Assessee by : Shri Pramod S. Shingte Revenue by Ms. Bhavya I. V. : Date of hearing 22.07.2026 : Date of pronouncement : 06.10.2026 आदेश / ORDER PER VINAY BHAMORE, JM: These appeals filed by the assessee are directed against the separate orders dated 29.01.2026 passed by Ld. CIT(A)/NFAC for the assessment years 2017-18, 2018-19 and 2020-21 respectively. 2. Since the facts and issues are identical and the above captioned three appeals were heard together, therefore, we proceed to dispose of the same by this common order.

2 ITA Nos.1534, 1535 & 1536/PUN/2026 ITA No.1534/PUN/2026, A.Y. 2017-18 : 3. The appellant has raised the following grounds of appeal :- “1. On the facts and in the circumstances of the case and in law learned CIT(A) erred in rejecting deduction under section 80P(2)(a)(i) for a sum of Rs. 83,75,071/- being part of the book profit of appellant society without appreciating the fact that earning of interest/dividend is an integral part of society's business and appellant prays for allowing such deduction. 2. On the facts and in the circumstances of the case and in law the learned CIT(A) erred in treating a sum of Rs. 51,45,069/- being interest received on investment with other Co-Operative Bank as ineligible amount for calming deduction under section 80P(2)(a)(i) without appreciating the fact that earning of interest is an integral part of societies' business and appeal and prays for allowing such deduction. 3. On the facts and in the circumstances of the case and in law the learned CIT(A) erred in treating a sum of Rs. 32,30,002/- being dividend income, as ineligible amount for calming deduction under section 80P(2)(d) without appreciating the fact that earning such dividend is an integral part of societies' business and appeal and prays for allowing such deduction. 4. On the facts and in the circumstances of the case and in law the learned CIT(A) erred in treating the interest/dividend received from investment as income from other sources by rejecting appellant's contention that said interest/dividend income is integral part of business activity and your appellant prays for cancellation of Assessing officer's action. 5. Without prejudice to above ground on the facts and circumstances of the case and in the law Learned Assessing Officer erred in not allowing the deduction under section 80P(2)(d) of Rs. 83,75,071/- on interest/dividend income received. Your appellants pray for allowing of the same. Your appellant prays for deletion of entire addition. Your appellant craves for to add, alter amend, modify, delete any or all grounds of appeal before or during the course of hearing in the interest of principle of natural justice.”

3 ITA Nos.1534, 1535 & 1536/PUN/2026 4. Facts of the case, in brief, are that the assessee is a credit co- operative society engaged in the activity of providing credit facilities to its members and also accepting deposits from them and also engaged in printing business and has furnished its return of income on 01.11.2017 by declaring taxable income of Rs.35,59,700/- after claiming deduction of Rs.83,75,071/- u/s 80P(2)(d) of the IT Act. The case was selected for scrutiny under CASS and notices u/s 143(2) & 142(1) respectively were issued to the assessee. During the course of assessment proceedings, Assessing Officer found that the assessee credit co-operative society has earned interest income of Rs.51,45,069/- on bank FDR and also earned dividend income on shares of Rs.32,30,002/- both from the Pune District Central Coop. Bank Ltd. and claimed total deduction of Rs.83,75,071/- u/s 80P(2)(d) of the IT Act. The Assessing Officer by placing reliance on the judgement passed by Hon’ble High Court of Karnataka in the case of PCIT vs. Totagar’s Cooperative Sales Society Ltd. (2017) 83 taxmann.com 140 (Karnataka) and also referring section 80P(4) of the IT Act proposed to disallow the deduction of Rs.83,75,071/- u/s 80P(2)(d) of the IT Act claimed by the assessee. The assessee credit co-

4 ITA Nos.1534, 1535 & 1536/PUN/2026 operative society submitted before the Assessing Officer that for assessment year 2016-17 similar deduction claimed by the assessee u/s 80P(2)(d) of the IT Act was allowed, however the Assessing Officer vide order dated 21.12.2019 completed the assessment proceedings u/s 143(3) of the IT Act by determining the income of the assessee at Rs.1,19,34,771/- as against the income of Rs.35,59,700/- returned by the assessee. The above assessed income includes addition of Rs.83,75,071/- (Rs.51,45,069/- FDR Interest + Rs.32,30,002/- Dividend Income from cooperative society) being disallowance u/s 80P(2)(d) of the IT Act. 5. Being aggrieved with the above action of the Assessing Officer, the assessee credit co-operative society preferred an appeal before Ld. CIT(A)/NFAC. Not being satisfied with the reply and submissions of the assessee, Ld. CIT(A)/NFAC dismissed the appeal and confirmed the disallowance of deduction u/s 80P(2)(d) of the IT Act. 6. It is the above order against which the assessee is in appeal before this Tribunal. 7. We have heard Ld. counsels from both the sides and perused the material available on record. In this regard, we find that the

5 ITA Nos.1534, 1535 & 1536/PUN/2026 assessee credit co-operative society has earned interest on FDR and also earned dividend income from Pune District Central Co- operative Bank Ltd and claimed deduction u/s 80P(2)(d) of the IT Act which was disallowed by the Assessing Officer. In this regard, we find that coordinate benches of this Tribunal in various decisions including the cases of Armed Forces Ex-Officers Multi Services Co-Operative Soc. has already held that credit co- operative society are entitled to claim deduction u/s 80P(2(d) of the IT Act with regard to interest income earned from its investments with other co-operative banks which are also cooperative societies. In this regard, we find support from decision passed by the Jurisdictional Tribunal in the case of Armed Forces Ex-Officers Multi Services Co-Operative Soc. in ITA No.2343/PUN/2024 order dated 28-02-2025 wherein the Tribunal allowed the deduction u/s 80P(2)(d) of the IT Act by observing as under :- “6. The Ld. AR submitted that the assessee has rightly claimed the deduction u/s. section 80P(2)(d) of the Act in respect of interest income earned during the relevant A.Y. from co-operative banks, such banks being cooperative societies. He further submitted that the claim of the assessee was accepted in the original assessment framed u/s. 143(3) of the Act on 16.03.2015, a copy of the said assessment order was placed on record. The Ld. PCIT, therefore erred in exercising his revisional powers u/s. 263 of the Act and directing the Ld. AO to reconsider the deduction claimed by the assessee u/s.80P of the Act.

6 ITA Nos.1534, 1535 & 1536/PUN/2026 6.1 The Ld. AR submitted that the impugned issue has been decided in favour of the assessee by the various decisions of the co-ordinate bench of the Tribunal and relied on the following judicial precedents in support thereof: (i) Kolhapur District Central Co-op. Bank KanistaSevakanchiSahakarPatsanstha Lad, vs. ITO, ITΑ Νο. 1365/PUN/2023 (A.Y 2018-19) (ii) Rena SahakariSakhar Karkhana Ltd vs. PCIT-2 Aurangabad ITA No. 1249/PUN 2018 (Α.Υ 2013-14) (iii) Hilla Heights as Co-operative vs. ADIT ITA No.2850/MUM/2022 (Α.Υ 2020-21) (iv) Amore Commercial Premises Co-op. Society Ltd. vs. CPC, ITA Nos. 2873 & 2874/M/2022 (Α.Υ. 2020-21) (v) Pune JilhaGramsevakvs. Income Tax Officer, Ward12(1), Pune dated 19 March, 2024 (AY 2018-19) 6.2 The Ld. AR further submitted that impugned issue has been decided by the Pune bench of the Tribunal in assessee’s own case for A.Y.2013-14 in ITA No. 787/PUN/2024 vide order dated 27.09.2024. 7. The Ld. DR, on the other hand, supported the order of the Ld. AO/CIT(A). 8. We heard the Ld. Representative of the parties and perused the material available on record as well as various judicial precedents cited by the Ld. AR in support of its claim of deduction u/s. 80P of the Act. The facts are not in dispute. During the relevant AY, the assessee has earned interest income from four co-operative banks, namely (i) The Cosmos Co-operative Bank Ltd. (ii) Pune District Central Co- Operative Bank (iii) The ShamraoVitthal Co-operative Bank and (iv) Saraswat Co-operative Bank Ltd and claimed deduction u/s.80P(2)(d) of the Act in respect thereof. We find that the impugned issue is no more res-integra in the light of the various decisions of the co- ordinate bench of the Tribunal (supra) relied upon by the Ld. AR. We further observe that the impugned issue is also covered in favour of the assessee by the decision of the Tribunal dated 27.09.2024in ITA No.787/PUN/2024in assessee’s own case for AY 2013-14. The relevant observations and findings of the Tribunal in the said decision are reproduced below: “8.We have heard the ld. Counsels from both the sides and perused the material available on record including the case laws furnished by assessee in the paper book. We find that the ld. CIT(A)/NFAC has confirmed the disallowance made by the Assessing Officer u/s 80P(2)(d) of the IT Act on the basis of judgement of Hon'ble High Court of Karnataka in the case of

7 ITA Nos.1534, 1535 & 1536/PUN/2026 PCIT, Hubballi vs. Totagars Cooperative Sale Society, 395 ITR 611 order dated 16.06.2017, not being business income of the assessee cooperative society. We find that this issue is squarely covered by various decisions of the Jurisdictional Co-ordinate Benches of this Tribunal, wherein, it has been held that the interest income earned by a co-operative society from any other co-operative society on its investments is eligible for deduction u/s 80P(2)(d) of the IT Act. It is worthwhile to mention here that though the co-operative banks pursuant to the insertion of sub- section (4) to section 80P would no more entitle for claim of deduction u/s 80P of the IT Act but as a co-operative bank continues to be a co-operative societies registered under the Co-operative Societies Act in any State, the interest income derived by a cooperative society from its investments held with a co-operative bank would be entitled for claim of deduction u/s 80P(2)(d) of the IT Act. In this regard, we find support from the following decisions passed by the Co-ordinate Benches of this Tribunal :- (i) Kolhapur District Central Co-op. Bank KanistaSevakanchiSahakarPatsanstha Lad, vs. ITO, ITΑ Νο. 1365/PUN/2023. A.Y 2018-19, dated 01.01.2024. (ii) Rena SahakariSakharKarkhana Lid vs. PCI-2 Aurangabad ITA No. 1249/PUN 2018 Α.Υ 2013-14, order dated 07.01.2022 (iii) Hilla Heights as Co-operative ADIT ITA No.2850/MUM/2022 Α.Υ 2020-21, dated 03 04 2023. (iv) Amore Commercial Premises Co-op. Society Ltd. vs. CPC, ITA Nos. 2873 & 2874/M/2022 Α.Υ. 2020-21, dated 17.01.2023 (v) Dhanshree Multistate Cooperative Society Ltd, ITA No.463/PUN/2024 order dated 13-06-2024. (vi) Karmveer Bhaurao Patil Nagri Sahkari Patsanstha Maryadit ITA No. 1045/PUN 2023 order dated 21-02- 2024. 9. Therefore, respectfully following the above decisions, we find that the interest income earned by the assessee co-operative society on its investments made with other co-operative banks being a co-operative society entitles for deduction u/s 80P(2)(d) of the IT Act. We therefore allow ground no.1 raised by the assessee and direct the Assessing Officer to allow the deduction of Rs.1,65,02,105/- u/s 80P(2)(d) of the IT Act.”

8 ITA Nos.1534, 1535 & 1536/PUN/2026 9. Respectfully following the decisions (supra) and in the absence of any contrary material brought on record by the Revenue to enable us to take a different view, we set aside the order of the Ld.CIT(A). Accordingly, the grounds raised by the assessee are allowed. 10. In the result, the appeal of the assessee is allowed.” 8. Respectively following the above decision passed in the case of Armed Forces Ex-Officers Multi Services Co-Operative Soc. (supra) wherein section 80P(4) & case of Totgar’s Sale Society Ltd. (supra) has been referred & distinguished, we are of the considered opinion that the assessee credit coop society is entitled for deduction u/s 80P(2)(d) of the IT Act. The language of section 80P(2)(d) is unambiguous which also provides deduction of dividend income earned by a credit cooperative societies from other cooperative societies & in the instant case in hand dividend income of Rs.32,30,002/- is earned by the assessee credit cooperative society from its compulsory/ mandatory investment in shares of other cooperative society which is PDCCB Ltd. which is undisputedly a cooperative society hence dividend income earned by the assessee credit cooperative society is also deductible u/s 80P2(d) of the IT Act. 9. Considering the totality of the facts of the case & in view of above discussion, we deem it appropriate to set-aside the order

9 ITA Nos.1534, 1535 & 1536/PUN/2026 passed by Ld. CIT(A)/NFAC and direct the Assessing Officer to allow deduction of Rs.83,75,071/- (Rs.51,45,069/- FDR Interest + Rs.32,30,002/- Dividend Income from cooperative society) claimed by the assessee u/s 80P(2)(d) of the IT Act with regard to interest and dividend income earned from its investments from other co-operative banks which are also cooperative societies. Accordingly, the grounds raised by the assessee credit co-operative society are allowed. 10. In the result, the appeal filed by the assessee in ITA No.1534/PUN/2026 for A.Y. 2017-18 is allowed. ITA Nos.1535 & 1536/PUN/2026, A.Ys. 2018-19 & 2020-21 : 11. Since the facts and issues involved in the remaining two appeals of the assessee in ITA Nos.1535 & 1536/PUN/2026, for A.Ys. 2018-19 & 2020-21 are identical to the appeal of the assessee in ITA No.1534/PUN/2026 for A.Y. 2017-18 therefore, our decision in ITA No.1534/PUN/2026 for A.Y. 2017-18 shall apply mutatis mutandis to the remaining two appeals of the assessee in ITA Nos.1535 & 1536/PUN/2026, for A.Ys. 2018-19 & 2020-21. Accordingly, the remaining two appeals of the

10 ITA Nos.1534, 1535 & 1536/PUN/2026 assessee in ITA Nos.1535 & 1536/PUN/2026, for A.Ys. 2018-19 & 2020-21 are also allowed. 12. In the result, the appeals filed by the assessee in ITA Nos.1535 & 1536/PUN/2026, for A.Ys. 2018-19 & 2020-21 are allowed. 13. To sum up, all the above captioned three appeals filed by the assessee are allowed, as indicated above. Order pronounced on this 06th day of October, 2026. Sd/- Sd/- (R. K. PANDA) (VINAY BHAMORE) VICE PRESIDENT JUDICIAL MEMBER पुणे / Pune; �दनांक / Dated : 06th October, 2026. Sujeet/DOC Sujeet Kumar Digitally signed by Sujeet Kumar Sharma Sharma Date: 2026.10.08 10:37:10 आदेश क� �ितिलिप अ�ेिषत / Copy of the Order forwarded to : +05'30' अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The Pr. CIT concerned. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, “B” ब�च, 4. पुणे / DR, ITAT, “B” Bench, Pune. गाड� फ़ाइल / Guard File. 5. आदेशानुसार / BY ORDER, // True Copy // Assistant Registrar आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune.