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Income Tax Appellate Tribunal, “A” BENCH, PUNE
Before: SHRI R.S.SYAL & SHRI PARTHA SARATHI CHAUDHURY, JM
आदेश / ORDER
PER PARTHA SARATHI CHAUDHURY, JM :
This appeal preferred by the assessee emanates from the order of Ld. CIT(Appeals)-7, Pune dated 11.07.2016 for the assessment year 2008-09 as per following grounds of appeal on record:
“1. In the facts and circumstances of the case and in law, the learned C.I.T.[A] has grossly erred in denying deduction u/s.80P[2][a][i] of the I.T. Act 1961 to the appellant in respect of interest income of Rs.71,56,584.00 earned from fixed deposits kept by it with nationalized banks and has further erred in taxing the said income u/s.56 of the I.T. Act 1961.The aforesaid addition being patently illegal, bad in law, arbitrary, perverse and devoid of merits the same may please be deleted
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and it may please be held that the aforesaid interest income is exempt u/s.80P[2][a][i] of the I. T. Act 1961. 2. In the facts and circumstances of the case and in law, the learned C.I.T.[A] has grossly erred in denying deduction u/s.80P[2][a][i] of the I. T. Act 1961 to the appellant in respect of Dividend income and interest on NRF amounting to Rs.3,028.00. The aforesaid addition being patently illegal, bad in law, arbitrary, perverse and devoid of merits the same may please be deleted and it may please be held that the aforesaid interest income is exempt u/s.80P[2][a][i] of the I.T. Act 1961. 3. The appellant craves the permission to add, amend, modify, alter, revise, substitute, delete any or all grounds of appeal, if deemed necessary at the time of hearing of appeal.”
At the time of hearing, the Ld. AR of the assessee submitted that he is
not pressing ground No.2. We, therefore, taking the submissions of the Ld.
AR of the assessee on record, dismiss ground No.2 in the grounds of appeal
as ‘not pressed”.
Ground No.3 is general in nature and hence, requires no adjudication.
With regard to ground No.1, it relates to denial of deduction
u/s.80[2][a][i] of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’)
to the assessee in respect of interest income of Rs.71,56,584.00 earned from
fixed deposits kept by it with nationalized banks. The facts in this case are
that the assessee is co-operative society engaged in the business of providing
credit facilities to its members. It is claimed that the necessary registration
and license has been obtained by the assessee from the concerned
Government authorities. The assessee has e-filed return of income on
24.08.2010 declaring total income of Rs. Nil and the total income was
assessed u/s.143(3) of the Act to Rs.54,12,970/- by the Assessing Officer.
With regard to this issue, the Ld. AR of the assessee at the time of
hearing submitted that ground No.1 is already decided in favour of the
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assessee by the decision of the Co-ordinate Bench of the Tribunal, Pune in
ITA No.589/PUN/2016 for the assessment year 2012-13 in the case of ITO
Vs. Sureshdada Jain Nagri Sahakari Patsanstha, therein, in Para 2 of the
order, the issue is as under:
“2. The only grievance projected by the Revenue in its appeal is against the allowing of deduction u/s.80P of the Income Tax Act, 1961 (hereinafter also called as ‘the Act’) in respect of interest earned by the assessee society from State Bank of India which was denied by the Assessing Officer.”
Thereafter, the Tribunal has held as follows:
“4.We have heard both the sides and perused the relevant material on record. It is observed that the ld. CIT(A) allowed the claim of deduction u/s.80P by following the order passed by the Tribunal in the case of Shivneri Nagari Sahakari Patsanstha Ltd. (supra). The ld. AR placed on record a copy of the another order of the Pune Bench dated 19-08-2015 in the case of Shri Laxmi Narayan Nagari Sahakari Pat Sanstha Maryadit Vs. ITO (ITA No.604/PN/2014) (to which one of us, namely, the ld. JM is party) in which similar deduction has been allowed. The Pune Bench of the Tribunal in the case of Shri Laxmi Narayan Nagari Sahakari Pat Sanstha Maryadit (supra) has discussed the contrary views expressed by the Hon’ble Karnataka High Court in Tumkur Merchants Souharda Credit Cooperative Ltd. Vs. ITO (2015) 230 taxmann 309 (Kar.) allowing the deduction u/s. 80P on interest income and the Hon’ble Delhi High Court in Mantola Cooperative Thrift Credit Society Ltd. Vs. CIT (2014) 110 DTR 89 (Delhi) not allowing deduction u/s.80P on interest income, earned from banks under similar circumstances. Both the Hon’ble High Courts have taken into consideration the ratio laid down in the case of Totgar’s Cooperative Sale Society Ltd. 322 ITR 283 (SC). There being no direct judgment from the Hon’ble jurisdictional High Court on the point, the Tribunal in Shri Laxmi Narayan Nagari Sahakari Pat Sanstha Maryadit (supra) preferred to go with the view taken in favour of the assessee by the Hon’ble Karnataka High Court in the case of Tumkur Merchants Souharda Credit Cooperative Ltd. (supra). In the absence of their being any change in the legal position prevailing on this issue after the passing of the order by the Pune Bench of the Tribunal in Shri Laxmi Narayan Nagari Sahakari Pat Sanstha Maryadit (supra) and host of other orders reiterating the similar view, respectfully following the precedent, we uphold the impugned order in allowing deduction u/s.80P on the interest income”
Respectfully, following the aforesaid decision of the Co-ordinate Bench
of the Tribunal, Pune, we set aside the order of the Ld. CIT(Appeals) and allow
ground No.1 of the grounds of appeal of the assessee.
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In the combined result, appeal of the assessee is partly allowed. 6.
Order pronounced on 25th day of January, 2019.
Sd/- Sd/- R.S.SYAL PARTHA SARATHI CHAUDHURY VICE PRESIDENT JUDICIAL MEMBER पुणे / Pune; �दनांक / Dated : 25th January, 2019. SB आदेश क� ��त�ल�प अ�े�षत / Copy of the Order forwarded to :
अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The CIT (Appeals)-7, Pune. 4. The CIT-6, Pune. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, “ए” ब�च, 5. पुणे / DR, ITAT, “A” Bench, Pune. गाड� फ़ाइल / Guard File. 6.
// True Copy // आदेशानुसार / BY ORDER,
�नजी स�चव / Private Secretary आयकर अपील�य अ�धकरण, पुणे / ITAT, Pune.
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Date 1 Draft dictated on 24.01.2019 Sr.PS/PS 2 Draft placed before author 25.01.2019 Sr.PS/PS 3 Draft proposed and placed JM/AM before the second Member 4 Draft discussed/approved by AM/JM second Member 5 Approved draft comes to the Sr.PS/PS Sr. PS/PS 6 Kept for pronouncement on Sr.PS/PS 7 Date of uploading of order Sr.PS/PS 8 File sent to Bench Clerk Sr.PS/PS 9 Date on which the file goes to the Head Clerk 10 Date on which file goes to the A.R 11 Date of dispatch of order