BELLARE C A BANK LTD. ,BELLARE vs. INCOME TAX OFFICER, WARD-1, , PUTTUR

ITA 272/BANG/2024Status: DisposedITAT Bangalore30 July 2024AY 2017-1814 pages
AI SummaryRemanded

What did the Tribunal hold?

The ITAT held that interest income from investments in banks, even if made under compulsion, is not attributable to the main business of providing credit facilities and thus not deductible under Section 80P(2)(a)(i). The issue of deduction under Section 80P(2)(d) for interest from co-operative banks was remitted to the AO for verification.

What were the facts?

The assessee, a primary agricultural co-operative society, claimed deduction under Section 80P on its income. The AO denied the deduction, treating investment income as 'income from other sources' and disallowed provision for NPA. The CIT(A) allowed partial deduction under Section 80P(2)(a)(i) and Section 57.

What were the issues?

Whether interest income from investments in banks is deductible under Section 80P(2)(a)(i) and whether interest income from co-operative banks is deductible under Section 80P(2)(d).

Which sections of the Income-tax Act were involved?

Section 80P,Section 57,Section 56

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Income Tax Appellate Tribunal, B BENCH : BANGALORE

Before: SHRI LAXMI PRASAD SAHU & SHRI KESHAV DUBEY

For Appellant: Smt. Sheetal Borkar, Advocate
For Respondent: Shri Subramanian S., Jt.CIT(DR)(ITAT), Bengaluru
Hearing: 12.07.2024Pronounced: 30.07.2024

Per Laxmi Prasad Sahu, Accountant Member This appeal is filed by the assessee against the order dated 20.12.2023 of the CIT(Appeals), National Faceless Appeal Centre, Delhi [NFAC], for the AY 2017-18 on the following revised grounds dated 21.5.2024 :- “1. The learned CIT (A) appeal erred in passing the orders in the manner he did.

2.

The learned CIT(A) appeal erred restricting the deduction under 80P(2)(a)(i) to the extent of Rs.11,99,658/- as against Rs.48,97,193/- without appreciating the submission of the appellant.

3.

The learned CIT(A) erred in restricting the deduction under 57 to the extent of Rs.24,59,246/- as against Rs.66,16,858

The order continues below.

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