ANNAPURNA NAGARI SAHKARI PATHSANSTHA MARYADIT,JALGAON vs. ITO, WARD 1(4), JALGAON, JALGAON
Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE
Before: SHRI R. K. PANDA & Ms. ASTHA CHANDRAAssessment year : 2018-19
PER R.K. PANDA, VP:
This appeal filed by the assessee is directed against the order dated
16.01.2025 of the Ld. CIT(A) / NFAC, Delhi relating to assessment year 2018-19. 2. Facts of the case, in brief, are that the assessee is an AOP engaged in the business of running credit co-operative societies by providing credit facilities to its members. It filed its return of income on 13.10.2018 declaring total income of Nil.
The case was selected for limited scrutiny under CASS. Accordingly statutory notices u/s 143(2) and 142(1) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) were issued and served on the assessee in response to which the assessee filed the requisite details from time to time. During the course of assessment proceedings the Assessing Officer noted that the assessee has shown to 2
have received interest amount of Rs.1,27,28,099/- from bank investment, the details of which are as under:
The Assessing Officer, therefore, asked the assessee to explain the allowability of deduction u/s 80P(2)(d) of the Act. Rejecting the various explanations given by the assessee and relying on various decisions the Assessing Officer disallowed the claim of deduction u/s 80P(2)(d) of the Act by recording as under:
3
4. In appeal, the Ld. CIT(A) / NFAC upheld the action of the Assessing
Officer.
4
5. Aggrieved with such order of the Ld. CIT(A) / NFAC, the assessee is in appeal before the Tribunal by raising the following grounds:
1]
The learned CIT(A) erred in confirming the disallowance of deduction u/s 80P of Rs.1,27,28,099/- without appreciating that the disallowance made was not justified at all and accordingly, the said disallowance is required to be deleted.
2]
The learned CIT(A) erred in not appreciating the fact that the learned A.O.
was not justified in disallowing the deduction of Rs.1,27,28,099/-, claimed u/s 80P in respect of the interest income earned by the assessee from investment in other co-operative banks and hence, the claim made by the assessee should have been allowed.
3]
The learned CIT(A) failed to appreciate that the assessee has invested funds in the course of its business of providing credit facilities to its members and accordingly, the deduction u/s 80P(2)(a)(i) was allowable to the assessee in respect of the above referred interest income earned by it.
4]
The learned CIT(A) further erred in not appreciating that the interest income of Rs.1,27,28,099/- was earned from the deposits / investments with co-operative banks and hence, the said amount was eligible for deduction u/s 80P(2)(d) of the Act.
5]
The appellant craves leave to add, alter, amend or delete any of the above grounds of appeal.
The Ld. Counsel for the assessee at the outset referred to the decision of the Co-ordinate Bench of the Tribunal in assessee’s own case for assessment year 2020-21 vide ITA No.2471/PUN/2024 order dated 24.03.2025 and submitted that identical issue has been decided by the Tribunal in favour of the assessee and the claim of deduction u/s 80P(2)(d) of the Act has been allowed. He submitted that following the above decision, the Tribunal again in assessee’s own case for assessment year 2013-14 vide ITA No.313/PUN/2025 order dated 07.05.2025 has allowed the claim of deduction u/s 80P(2)(d) of the Act. He accordingly submitted
5
that the issue being covered in favour of the assessee, the grounds raised by the assessee should be allowed.
The Ld. DR on the other hand heavily relied on the orders of the Assessing Officer and the Ld. CIT(A) / NFAC.
We have heard the rival arguments made by both the sides, perused the orders of the Assessing Officer and the Ld. CIT(A) / NFAC and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find the Assessing Officer in the instant case disallowed the interest income of Rs.1,27,28,099/- earned by the assessee out of fixed deposits / investments made with other co-operative banks, the reasons of which have already been reproduced in the preceding paragraphs. We find in appeal the Ld. CIT(A) / NFAC sustained the addition made by the Assessing Officer.
We find an identical issue has already been decided by the Co-ordinate Bench of the Tribunal in assessee’s own case for assessment year 2020-21 vide ITA No.2471/PUN/2024 order dated 24.03.2025. The Tribunal while allowing the claim of deduction u/s 80P(2)(d) of the Act has observed as under: “7. We have heard both the sides and perused the record placed before us. In the instant case, the Assessing Officer disallowed the interest income of Rs.1,63,98,998/- earned out of the Fixed deposits/Investments made with Cooperative Banks treating the same as Income from Other Source. Ld.CIT(A) dismissed the appeal in limine without discussing anything on merits of the issues and on the ground that the assessee has not provided plausible explanation for admission of additional evidences.
6
8. Section 80P(2)(d) of the Act provides that the sum received in respect of any income by way of interest or dividend derived by Cooperative Society from its investment with any other Cooperative Society, the whole of such income is eligible for deduction u/s.80P of the Act. we find that this issue is no more res integra as the Coordinate Benches of this Tribunal has been consistently holding that the interest income earned out of the FDs/Investments kept with Cooperative
Banks is allowable u/s.80P(2)(d) of the Act. We find that this Tribunal in case of Kolhapur District Central Co-op. Bank Kanista Sevakanchi Sahakar Pat Sanstha
Ltd., Vs. ITO in ITA No.1365/PUN/2023, dated 01.01.2024 dealing with similar issue after placing reliance on another decision of this Tribunal in the case of The Ugar Sugar Works Kamgar & Dr. Shirgaokar Shaikshanik Trust Nokar Co-op
Credit Society vs. ITO in ITA No.84/PAN/2018, dated 27.05.2022 has held that the interest earned from deposits with Cooperative Banks are also eligible for deduction u/s.80P(2)(d) of the Act as Cooperative Banks are basically
Cooperative Societies only but have turned into Bank on getting necessary banking license.
Respectfully following the above referred decisions taking consistent view along with considering the facts of the case, where the assessee made investment with the Cooperative Banks we hold that the assessee is eligible for deduction u/s.80P(2)(d) of the Act for the interest income earned from Cooperative Banks at Rs.1,63,98,998/-. Findings of the ld. CIT(A) is set-aside and the Assessing Officer is directed to allow the claim made by the assessee. Effective grounds of appeal raised by the assessee are allowed.”
We find following the above decision the Tribunal again in assessee’s own case for assessment year 2013-14 vide ITA No.313/PUN/2025 order dated 07.05.2025 has allowed the claim of deduction u/s 80P(2)(d) of the Act in respect of the interest earned from the fixed deposits / investments with the other co- operative banks.
Respectfully following the above decisions of the Co-ordinate Bench of the Tribunal in assessee’s own case for the two years mentioned above and in absence of any contrary material brought to our notice by the Ld. DR, we, set aside the order of the Ld. CIT(A) / NFAC and direct the Assessing Officer to allow the 7 claim of deduction u/s 80P(2)(d) of the Act on the interest earned from the investments made with the other co-operative banks. The grounds raised by the assessee are accordingly allowed.
In the result, the appeal filed by the assessee is allowed.
Order pronounced in the open Court on 10th October, 2025. (ASTHA CHANDRA)
VICE PRESIDENT
पुणे Pune; दिन ांक Dated : 10th October, 2025
GCVSR
आदेश की प्रतितिति अग्रेतिि/Copy of the Order is forwarded to:
अपीलार्थी / The Appellant; 2. प्रत्यर्थी / The Respondent
4. The concerned Pr.CIT, Pune DR, ITAT, ‘A’ Bench, Pune 5. गार्ड फाईल / Guard file.
आदेशानुसार/ BY ORDER,
////
Senior Private Secretary
आयकर अपीलीय अधिकरण ,पुणे
/ ITAT, Pune
8
S.No.
Details
Date
Initials
Designation
1
Draft dictated on 09.10.2025
Sr. PS/PS
2
Draft placed before author
10.10.2025
Sr. PS/PS
3
Draft proposed & placed before the Second Member
JM/AM
4
Draft discussed/approved by Second
Member
AM/AM
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