P B CO STY LTD SWD,SAWANTWADI vs. INCOME TAX OFFICER, KUDAL

The only grievance of the assessee is that ld.CIT(A) erred in confirming the action of the Assessing Officer denying claim of deduction u/s.80P(2)(d) of the Act for the interest earned on investments made with Cooperative Banks.

When the appeal was called for none appeared on behalf of the assessee despite due service of hearing. With the assistance of ld. Departmental Representative and considering the fact that the issue raised in the instant appeal has already been decided by this Tribunal in catena of decisions holding in favour of the assessee, I proceed to adjudicate the appeal.

I have heard the ld. Departmental Representative and perused the record placed before me. I find that during the year under consideration assessee society has earned interest income of Rs.27,19,740/- from the investments held with Cooperative Banks. This Tribunal is consistently holding that Cooperative Banks are basically Cooperative Societies and therefore the interest income earned from investments with Cooperative Banks is also eligible for deduction u/s.80P(2)(d) of the Act. Lower authorities have denied the deduction as the above Cooperative banks are P B CO STY LTD SWD

This issue is no longer res integra by virtue of catena of decisions taking consistent view that interest income earned from deposits with Cooperative Banks is eligible for deduction u/s.80P(2)(d) of the Act. Recently, this Bench in the case of Annapurna Nagari Sahkari Pathsanstha Maryadit Yawal Vs. ITO in ITA No.313/PUN/2025, order dated 07.05.2025 has allowed the deduction claimed by the assessee u/s.80P(2)(d) of the Act observing as under :

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. 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. 9. 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.”

Respectfully following the same, we hold that deduction of Rs.1,02,95,103/- u/s.80P(2)(d) of the Act claimed by the assessee on the interest earned from deposits/Investments with P B CO STY LTD SWD

Respectfully following the same, I hold that deduction claimed by the assessee on the interest income at Rs.12,19,740/- earned from deposits/Investments with Cooperative Banks deserves to be allowed u/s.80P(2)(d) of the Act. Impugned finding of ld.CIT(A) is set aside and effective Grounds of appeal raised by the assessee are allowed.

In the result, appeal of the assessee is allowed.

अपीलाथ / The Appellant. 2. यथ / The Respondent. 3. The Pr. CIT concerned. 4. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण, “SMC” बच, पुणे / DR, ITAT, “SMC” Bench, Pune.

गाड फ़ाइल / Guard File. आदेशानुसार / BY ORDER,