BHANDUP INDUSTRIAL ESTATE CO-OP SOC. LTD.,MUMBAI vs. ITO WARD 29 (1)(2), MUMBAI

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ITA 1367/MUM/2020Status: DisposedITAT Mumbai27 October 2021AY 2015-163 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the assessee, being a co-operative society, is entitled to deduction under Section 80P(2)(d) for interest earned from a co-operative bank. The Tribunal also allowed the deduction claimed under Section 80P(2)(c).

What were the facts?

The assessee, a co-operative society, claimed deductions under Section 80P(2)(d) for interest received from a co-operative bank and under Section 80P(2)(c). The Assessing Officer disallowed these claims, and the CIT(A) confirmed the disallowance.

What were the issues?

Whether interest income earned by a co-operative society from a co-operative bank is eligible for deduction under Section 80P(2)(d), and whether the assessee is eligible for deduction under Section 80P(2)(c).

Which sections of the Income-tax Act were involved?

Section 80P(2)(d),Section 80P(2)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI

Before: SRI MAHAVIR SINGH

For Appellant: Shri Aditya Ramchandran,AR

आयकर अपीलीय अिधकरण “SMC” �यायपीठ मुंबई म�। आयकर अपीलीय अिधकरण �यायपीठ मुंबई म�। आयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरण �यायपीठ मुंबई म�। �यायपीठ मुंबई म�। IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI �ी महावीर �सह, उपा�य� के सम� । BEFORE SRI MAHAVIR SINGH, VICE PRESIDENT Aayakr ApIla saM Aayakr ApIla saM./ Aayakr ApIla saM Aayakr ApIla saM (inaQa-arNa baYa- / Assessment Year 2015-16) Bhandup Industrial Estate Co-op The Income Tax Officer Ward-29(1)(2) Soc.Ltd. C-10, 1st Floor, Room No.103 4094, Bhandup Industrial Estate BKC, Mumbai-400 051 Co-op Soc.Ltd. Vs. LBS Marg, Pannalal Compound, Bhandhup(W) Mumbai-400 078 (ApI ApI ApIlaaqaI ApI laaqaI laaqaI- / Appellant) laaqaI (p`%yaqaaI p`%yaqaaI p`%yaqaaI- / Respondent) p`%yaqaaI .. �थायी लेखा सं./PAN No. AAAAB1446J अपीलाथ� क� ओर से / Appellant by : Shri Aditya Ramchandran,AR ��यथ� क� ओर से / Respondent by : Shri Vaibhav Jain, DR 27.10.2021 सुनवाई क� तारीख / Date of hearing: घोषणा क� तारीख / Date of pronouncement : 27 .10.2021 AadoSa AadoSa / O R D E R AadoSa AadoSa महावीर �सह, उपा�य� के �ारा / PER MAHAVIR SINGH, VP:

This appeal of the assessee is arising out of order of the Commissioner of Income Tax (Appeals)]-40, Mumbai [in short CIT(A)], in appeal No. CIT(A),Mumbai-40/10203/2017-18 vide dated 05.11.2017. The Assessment was framed by the Income Tax Officer, Ward-29(1)(2) Mumbai (in short ITO/ AO) for the A.Y. 2015-16 vide order dated 05.11.2017 under section 143(3) of the Income-tax Act, 1961 (hereinafter ‘the Act’).

2.

The only issue in this appeal of assessee is against the order of Ld.CIT(A) confirming the action of the AO in disallowing deduction u/s. 80P(2)(d) of the Act on interest received from co-operative bank amounting to Bhandup Industrial Estate Co-op Soc.Ltd. AY 15-16 Rs.15,64,523/- and deduction u/s. 80P(2)(c) of the Act amounting to Rs. 50,000/-. For this, assessee has raised following two grounds:-

“1.On the facts and circumstances of the case and in law, the learned C1T(A) -40, Mumbai erred in confirming the action of the Ld. Assessing Officer in disallowing deduction u/s 80P(2)(d) amounting to Rs 15,64,523/-.

2.On the facts and circumstances of the case and in law, the learned CIT(A) - 40, Mumbai erred in confirming the action of the Ld. Assessing Officer in disallowing deduction u/s 80P(2)(c) amounting to Rs 50.000/-.”

3.

Brief facts are that the assessee is a co-operative society registered under Maharashtra Co-operative Societies Act, 1962. The Society is engaged in accepting deposits and providing credit facility to the members of the society and earned income mainly from interest on loan provided to its members and partly deposits in co-operative banks, which are claimed as exempt u/s. 80P(2)(d) of the Act. The AO treated entire income as taxable and disallowed the claim of deduction u/s. 80P(2)(d) and 80P(2)(c). Aggrieved assessee preferred appeal before CIT(A). The Ld.CIT(A) also confirmed the action. Aggrieved assessee came in appeal before the Tribunal. I have heard rival contentions and gone through facts and circumstances of the case. I noted that assesse has earned income from saving bank account and fixed deposit bank account maintained and investment in co-operative bank amounting to Rs. 15,64,523/- and claimed deduction u/s. 80P(2)(d). The assesee is a co- operative society i.e Bhandup Industrial Estate Co—op Society Ltd. and has invested the funds in co-operative bank, these

Bhandup Industrial Estate Co-op Soc.Ltd. AY 15-16 facts are undisputed. Once, the funds are deposited in co- operative bank, assessee being a co-operative society is entitled for deduction u/s. 80P(2)(d) of the Act and accordingly, I allow the claim of the assessee, the AO is directed accordingly.

4.

As regards to the claim u/s. 80P(2)(c), the assessee being a co-operative society exactly falling under section 80P(2)(c) is eligible for the claim for an amount of Rs.50,000/-. I allowed the claim of the assessee.

5.

In the Result, the appeal of assessee is allowed.

Order pronounced in the open court on 27.10.2021.

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