MOORTHEDARARA SEVA SAHAKARI SANGHA NIYAMITHA,DAKSHINA KANNADA vs. INCOME TAX OFFICER, WARD-1, PUTTUR

ITA 2277/BANG/2024Status: DisposedITAT Bangalore30 April 2025AY 2017-18Bench: SHRI WASEEM AHMED (Accountant Member), SHRI SOUNDARARAJAN K. (Judicial Member)1 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal, relying on the Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd., held that the presence of 'C' class (nominal) members does not violate the mutuality concept, thus entitling the assessee to deduction under Section 80P(2)(a)(i). It also confirmed entitlement to deduction under Section 80P(2)(d). The CIT(A)'s order denying Section 80P(2)(a)(i) was set aside, and the remission to the AO was deemed unnecessary.

What were the facts?

The assessee, a co-operative society, claimed deduction under Section 80P. The AO denied deductions under Section 80P(2)(a)(i) for interest income from members due to 'C' class (nominal) members, and under Section 80P(2)(d) for interest from co-operative banks. The CIT(A) allowed deduction under Section 80P(2)(d) but denied Section 80P(2)(a)(i) on mutuality grounds, remitting the matter to the AO for calculation.

What were the issues?

Whether the existence of nominal/C-class members in a co-operative society violates the mutuality concept, thereby disallowing deduction under Section 80P(2)(a)(i), and the assessee's entitlement to deduction under Section 80P(2)(d).

Which sections of the Income-tax Act were involved?

Section 80P,Section 80P(2)(a)(i),Section 80P(2)(d),Section 143(2),Section 142(1),Section 250

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Cases cited in this judgment(3)Show list

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Income Tax Appellate Tribunal, SMC-‘B’ BENCH : BANGALORE

Before: SHRI WASEEM AHMED & SHRI SOUNDARARAJAN K.

For Appellant: Shri Srikrishna Kantila, CA, Shri Ganesh R Gale, Standing

PER SOUNDARARAJAN K., JUDICIAL MEMBER

These are the four appeals filed by the assessee challenging the separate orders of the NFAC, Delhi all dated 27/09/2024 in respect of the A.Ys. 2015-16 to 2018-19. 2. All these appeals are related to the same assessee and the issue involved in all the appeals are similar. We decided to take up all the appeals together and pass a common order for the sake of convenience. Since the ITA Nos. 2275 to 2278/Bang/2024

grounds raised by the assessee in all the appeals are identical, grounds of appeal raised for the A.Y. 2015-16 in ITA No. 2275/Bang/2024 is reprod

The order continues below.

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