THE VASAI MACHHIMAR SARVODAYA SAHAKARI SANSTHA MARYADIT ,MUMBAI vs. ITO, WD 4(4), MUMBAI

In this appeal the appellant has claimed that the bank interest received from the Cooperative Banks on surplus funds as exempt under section 80P(2)(d) of the I.T. Act.

The Ld. AO and Ld. CIT(A) did not agree with the contentions of the appellant and deduction under section 80P(2)(d) of the Act was denied.

Aggrieved by the orders of the lower authorities, the appellant has escalated the issue to the ITAT.

During the hearing proceedings before the ITAT, Ld. AR of the appellant has stated that the income received by the appellant from the Cooperative Banks is eligible for deduction under section 80P(2)(d) of the Act. It was argued that the interest on surplus funds deposited with the banks bears character of “income from other sources” and not “business income”

Ld. DR relied on the assessment order and Ld. CIT(A) order.

After hearing submissions of both the parties and perusal of the detail paper book containing written submissions as well as various cases-law relied upon by the appellant, it is decided that the appellant is entitled for deduction under section 80P(2)(d) of the Act. Reliance is placed on the following decisions of Coordinate Benches and Hon'ble Supreme Court for the proposition that the appellant is entitled for deduction under section 80P(2)(d) of the Act :- • Maviyali Service Cooperative Bank Ltd. & Ors. Vs. CIT (Civil Appeal No. 7343-7350 of 2019) • Pathare Prabhu Cooperative Housing Society Ltd. Vs. ITO (ITA No. 1346 and 1347 of 2023)

As Hon'ble Supreme Court finally decided the issue of deduction in the case of Maviyali Service Cooperative Bank Ltd. (supra) in favour of the appellant, respectfully following the decision of Hon'ble Apex and other decisions of Coordinate Benches as mentioned above, it is held that the appellant is eligible for deduction under section 80P(2)(d) of the Act.

The appellant of appellant is allowed.