“eligible business”

DeductionsSection 80IASection 80IA975 judgments

The decision most relied on for eligible business is Totgars Co-operative Sale Society Ltd. v. ITO (322 ITR 283), cited in 1,283 judgments on BharatTax.

Leading authorities on eligible business

Totgars Co-operative Sale Society Ltd. v. ITO

322 ITR 283 · 2010 · Supreme Court

1,283

citing judgments

The interest income earned by a cooperative society from investing its surplus funds in fixed deposits with banks is not "derived from" its eligible business activities and is taxable as "income from other sources" under Section 56, thus not qualifying for deduction under Section 80P.

State Bank Of India v. CIT

389 ITR 578 · 2016 · High Court

817

citing judgments

Income arising from a cooperative society's surplus funds invested in short-term deposits and securities is not attributable to the society's core activities and, therefore, is not eligible for exemption under Section 80P(2)(a)(i) of the Income-tax Act.

Liberty India v. CIT

317 ITR 218 · 2009 · Supreme Court

571

citing judgments

The Supreme Court clarified that for profits and gains to be eligible for deductions under sections like 10B, 80IA, or 80IB, the income must be "derived from" or have a direct nexus to the eligible business activity. Income from incidental sources like the sale of scrips/licenses or interest on employee loans is generally not considered as derived from the eligible business for such deductions.

CIT v. Smifs Securities Ltd.

348 ITR 302 · 2012 · Supreme Court

540

citing judgments

Goodwill, whether arising from an amalgamation or a slump sale, is an intangible asset eligible for depreciation under Section 32(1) of the Income-tax Act. While the assessee must prove the existence and valuation of such goodwill, it is recognized as a depreciable asset.

Citizen Co-operative Society Ltd. v. ACIT

397 ITR 1 · 2017 · Supreme Court

499

citing judgments

A co-operative credit society engaged in banking business with the general public, accepting deposits from non-members and advancing loans to non-members, is treated as a co-operative bank. Such a society falls under the exclusionary clause of Section 80P(4) and is not eligible for deduction under Section 80P(2)(a)(i).

Totgar's Co-operative Sale Society Ltd. v. ITO

188 Taxmann 282 · 2010 · Supreme Court

486

citing judgments

Interest income earned by a co-operative society from investments, particularly with co-operative banks, is not eligible for deduction under Section 80P as it is not attributable to the core business activities of the society and constitutes "other income", not "profits and gains of business".

Pandian Chemicals Ltd. v. CIT

262 ITR 278 · 2003 · Supreme Court

353

citing judgments

Income eligible for deduction under Section 80IA or 80IC must have a direct nexus with the eligible business activity of the industrial undertaking. Income merely incidental to the business, even if part of the assessee's overall business, is not considered "derived from" the eligible undertaking.

CIT v. Sterling Foods

237 ITR 579 · 1999 · Supreme Court

311

citing judgments

Income eligible for profit-linked deductions under sections like 80-IC or 10B must have a direct nexus to the eligible business activity or be derived from the industrial undertaking itself, and not merely attributable to it or arising from a post-manufacturing event.

Judgments citing eligible business

Aditya Birla Nuvo Ltd (Since Amalgamated With Grasim Industries Limited), Mumbai vs. DCIT CC-1(4) Earlier With ACIT(Ltu) 1, Mumbai

In the result, theappeals filed by the assessee and revenue are partly

ITA 563/MUM/2018[2013-14]Status: DisposedITAT Mumbai17 Nov 2025AY 2013-14

Bench: The Hon’Bleunder Section 255(4) Of The Act. The Points Of Difference Were Thereafter Referred To The Hon’Blefor Resolution. The Hon’Blehas Now Rendered His Detailed Opinion & The Appeals Have Been Placed Before Us To Pass The Consequential

Section 255(4)Section 80

issue in substantial detail. He evaluated the statutory framework of section 80 IA(8) which requires that when goods or services of an eligible business are transferred to any other business carried on by the assessee, the consideration recorded in the accounts must correspond to the market value of such ... that the market value of goods and services sold, will be the price that such goods or services would fetch if sold by the eligible business in the open market subject to statutory and regulatory restrictions. Therefore, while determining the market value of electricity sold

Jt.CIT (OSD)-CC- 1(4), Mumbai vs. Aditya Birla Nuvo Ltd (Since Amalgamated With Grasim Industries Limited), Mumbai

The appeals are disposed of

ITA 1885/MUM/2018[2013-14]Status: DisposedITAT Mumbai17 Nov 2025AY 2013-14

Bench: SHRI AMIT SHUKLA (Judicial Member), SMT RENU JAUHRI (Accountant Member)

Section 255(4)Section 80

Kulandaivel Thaalamuthu, Namakkal vs. ACIT, Circle-1, Namakkal

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 1752/CHNY/2025[2016-17]Status: DisposedITAT Chennai14 Nov 2025AY 2016-17

Bench: Shri George George K & Shri S.R. Raghunathaआयकर अपील सं./Ita No.: 1752/Chny/2025 िनधा"रण वष"/Assessment Year: 2016-17 Shri Kulandaivel Thaalamuthu, The Assistant Commissioner 286/2, 1St Street, Vs. Of Income Tax, S.G. Complex, Circle 1, Thuraiyur Road, Namakkal. Namakkal – 637 001. Pan: Abnpt 2841G (अपीलाथ"/Appellant) (""यथ"/Respondent) अपीलाथ" क" ओर से/Appellant By : Shri N. Arjun Raj, Advocate ""यथ" क" ओर से/Respondent By : Ms. Gouthami Manivasagam, Jcit

For Appellant: Shri N. Arjun Raj, AdvocateFor Respondent: Ms. Gouthami Manivasagam, JCIT

Section 142(1)Section 143(2)Section 143(3)Section 154Section 250Section 44A

satisfied then the presumptive taxation is to be calculated as per section 44AE(2) of the Act. Section 44AD(6) Explanation (b) defines the ‘eligible business’ as any business except the business of plying, hiring or leasing of goods carriage vehicles referred in section 44AE of the Act. 12. Therefore ... goods carriage vehicles and is not owning more than 10 :- 8 -: goods carriage vehicles. Hence, prima facie, assessee’s business income from such eligible business is to be computed as per provisions of section 44AE of the Act. If assessee wants to claim income below what has been prescribed under

Incometax Officer, Ward-1(1), Tiptur vs. Sriudayaravi Credit Co-Op, Tiptur

In the result, appeals of the Revenue are dismissed

ITA 2095/BANG/2024[2018-19]Status: DisposedITAT Bangalore14 Nov 2025AY 2018-19

Bench: Shri.Laxmi Prasad Sahu & Shri. Keshav Dubey

For Appellant: Smt. Harsha J, AdvocateFor Respondent: Shri. Subramanian S, JCIT(DR)(ITAT), Bangalore

Section 2(24)(viia)Section 80PSection 80P(2)(a)Section 80P(4)

member, it would not be eligible for deduction u/s.80P(2)(a) of the Act. In appellant's case, the activity is not of an eligible business but an investment, further it is carried on with rank outsider institutions and banks who are not even nominal members of the appellant. Thus

DCIT-CC-8(4), Mumbai vs. Savita Oil Technologies Limited, Mumbai

In the result, appeal of the Revenue is dismissed

ITA 4292/MUM/2025[2018-19]Status: DisposedITAT Mumbai10 Nov 2025AY 2018-19

Bench: Shri Saktijit Dey, Hon'Ble & Shri Girish Agrawalassessment Year: 2018-19 Dcit-Cc-8(4), Savita Oil Technologies Limited Mumbai 66-67 Nariman Bhavan, Vs. Nariman Point, Mumbai 400021, Pan: Aaacs7934A (Appellant) (Respondent) Present For: Assessee : Shri Yogesh Thar & Shri Chaitanya Joshi, Cas Revenue : Shri Rajesh Kumar Yadav, Cit Dr Date Of Hearing : 13.08.2025 Date Of Pronouncement : 10.11.2025 O R D E R Per Girish Agrawal: This Appeal Filed By The Revenue Is Against The Order Of Cit (A) 50, Mumbai, Vide Order No. Itba/Apl/S/250/2025-26/1075632908(1), Dated 15.04.2025 Passed Against The Assessment Order By Acit,Cc- 8(4), Mumbai, U/S.143(3) Of The Income-Tax Act, 1961 (Hereinafter Referred To As The “Act”), Dated 24.08.2021 For Ay 2018-19. 2. Grounds Taken By The Revenue Are Reproduced As Under: “1. Whether On The Facts & In The Circumstances Of The Case, The Hon'Ble Cit(A) Was Justified In Law In Allowing Deduction Under Section 80-Ia(4) Of The Income- Tax Act, 1961, Without Adjusting The Losses Incurred By The Eligible Undertaking Prior To The Initial Assessment Year, Contrary To The Provisions Of Section 80-Ia(S)? 2. Whether The Hon'Ble Cit(A) Was Correct In Law In Relying Upon Cbdt Circular No. 1/2016 & The Decision Of The Hon'Ble Madras High Court In The Case Of Vcllayudhaswamy Spinning Mills Pvt. Ltd. (340 Itr 477) When There Exist Contrary Binding Judicial Precedents Mandating That Losses Of Earlier Years, Even

For Appellant: Shri Yogesh Thar and Shri Chaitanya Joshi, CAsFor Respondent: Shri Rajesh Kumar Yadav, CIT DR

Section 143(3)Section 37Section 80Section 80GSection 80I

overlooking the statutory requirement to compute profits as per the deeming fiction contained in section 80-IA(5) from the year of commencement of eligible business? 5. Whether on the facts and in the circumstances of the case and in law, the Ld. ClT (A) erred in holding that ... initial assessment year already absorbed against the profits of other business cannot be notionally brought forward and set off against the profit of the eligible business as no such mandate is provided in section 80-1A(5). The CIT(A) relying of the ratio of above decision has allowed

Secretary, Co-Operative Cane Development Union Limited, Bijnor vs. ITO Range 3(2), Bijnor

ITA 3408/DEL/2024[2020-21]Status: DisposedITAT Delhi04 Nov 2025AY 2020-21

Bench: Sh. Satbeer Singh Godara & Sh. Naveen Chandra

For Appellant: Ms. Gurneet Kaur, AdvFor Respondent: Sh. Manish Gupta, Sr. DR

Section 143(3)Section 80PSection 80P(2)

present instance received from parking of surplus funds in fixed deposits with scheduled/nationalized banks could not be held as “derived” from an eligible business activity under section 80P(2); and, therefore, the same deserves to be assessed as income from “other” sources only. 4. Mr. Gupta also quotes

Secretary Co-Operative Cane Development Union Limited, Bijnor vs. ITO Range 3(2), Bijnor

ITA 3407/DEL/2024[2017-18]Status: DisposedITAT Delhi04 Nov 2025AY 2017-18

Bench: Sh. Satbeer Singh Godara & Sh. Naveen Chandra

For Appellant: Ms. Gurneet Kaur, AdvFor Respondent: Sh. Manish Gupta, Sr. DR

Section 143(3)Section 80PSection 80P(2)

Dy..C.I.T., Bangalore vs. M/S State Bank of Mysore, Bangalore

ITA 684/BANG/2015[2011-12]Status: DisposedITAT Mumbai03 Nov 2025AY 2011-12

Bench: Justice (Retd.) C V Bhadang & Ms Padmavathy S, Am

For Appellant: Shri Ketan Ved & Ninad PatadeFor Respondent: Shri P.C. Chhotaray, Spl. Counsel

Section 2Section 250Section 36(1)(vii)Section 36(1)(viia)Section 36(1)(viii)Section 41(1)

viii) [A] Gross Total Income (Schedule 13 & 14 of Profit & 45,34,25,43,685 Loss Account) [B] Interest received in respect of eligible business under 1849,50,60,118 section 36 (1) (viii) [C] Eligible business profits for computing deduction u/s 217,05,51,659 36(1)(viii ... disallowed the said claim on the ground that the assessee has not maintained separate set of books in respect of the eligible business and the manner in which the eligible profits was computed i.e. using turnover as allocation key is against the provisions of the Act. The CIT(A) upheld

State Bank of Mysore, Bangalore vs. JCIT, Bangalore

ITA 661/BANG/2015[2011-12]Status: DisposedITAT Mumbai03 Nov 2025AY 2011-12

Bench: Justice (Retd.) C V Bhadang & Ms Padmavathy S, Am

For Appellant: Shri Ketan Ved & Ninad PatadeFor Respondent: Shri P.C. Chhotaray, Spl. Counsel

Section 2Section 250Section 36(1)(vii)Section 36(1)(viia)Section 36(1)(viii)Section 41(1)

Bilari Cooperative Cane Union, Bilari, Moradabad vs. Income Tax Ward 2(1), Moradabad

Appeal is allowed

ITA 2127/DEL/2025[2020-21]Status: DisposedITAT Delhi03 Nov 2025AY 2020-21

Bench: Shri Satbeer Singh Godara & Shri Naveen Chandraassessment Year: 2020-21 Vs. Income Tax Officer, Bilari Cooperative Cane Union, Bilari, Near Bus Ward-2(1), Stand, Moradabad, Moradabad Uttar Pradesh Pan: Aaaab2993E (Appellant) (Respondent) Assessee By Gurneet Kaur, Adv. Department By Sh. Manish Gupta, Sr. Dr

Section 143(3)Section 80PSection 80P(2)

present instance derived from bargaining of surplus funds in fixed deposits with scheduled/nationalized banks could not be held as “derived” from an eligible business activity under section 80P(2); and, therefore, the same deserves to be assessed as income from “other sources” only. 4. Mr. Gupta also quotes

Assistant Commissioner of Income Tax, Circle-5(1), Hyderabad vs. Mytrah Vayu (Gujarat) Private Limited, Hyderabad

In the result, appeal filed by the Revenue is dismissed

ITA 690/AHD/2025[2014-15]Status: DisposedITAT Ahmedabad28 Oct 2025AY 2014-15

Bench: SMT. ANNAPURNA GUPTA (Accountant Member), Ms. SUCHITRA KAMBLE (Judicial Member)

For Appellant: Shri Prathvi Raj Meena, CIT.DRFor Respondent: Shri Ravi Bharadwaj V & Shri

Section 250Section 56(2)Section 56(2)(vii)

Form 3CEB under the head SDT in the nature of any business transacted which has resulted in more than ordinary profits to an eligible business to which 80IA or Section 10AA of the Act is applicable. He, accordingly, rejected the contention of the assessee that the impugned transaction ... Where it appears to the Assessing Officer that, owing to the close connection between the assessee carrying on the eligible business to which this section applies and any other person, or for any other reason, the course of business between them is so arranged that the business transacted between them

Assistant Commissioner of Income Tax, Tirupur vs. Sri Shanmugavel Mills Private Limited, Tirupur

In the result, appeal filed by the Revenue is dismissed

ITA 1048/CHNY/2025[2017]Status: DisposedITAT Chennai24 Oct 2025

Bench: Shri Aby T. Varkey & Shri Amitabh Shukla

For Appellant: Mr.Suraj Nahar, CAFor Respondent: Mr.Saddik Ahmed, Sr.AR

Section 143(3)Section 80ISection 92C

seen that if the assessing officer disputes the consideration for supply of any goods by the assessee as recorded in the accounts of the eligible business on the ground that it does not correspond to the market value of such goods as on the date of the transfer, then ... purpose of deduction under section 80-IA, the profits and gains of such eligible business shall be computed by adopting arm's length pricing. In other words, if the assessing officer rejects the price as not corresponding to the market value of such good, then he has to compute

DCIT, Circle - 19(1), Delhi vs. Punjab National Bank (Earlier Known As Oriental Bank of Commerce), Delhi

Appeal is dismissed in above terms

ITA 3161/DEL/2024[2017-18]Status: DisposedITAT Delhi24 Oct 2025AY 2017-18

Bench: Shri Satbeer Singh Godara & Shri Avdhesh Kumar Mishraassessment Year: 2017-18 Dcit, Vs. Punjab National Bank (Earlier Circle-19(1), Know As Oriental Bank Of Delhi Commerce), Harsha Bhawan, E Block, Connaught Place, Delhi Pan: Aaaco0191M (Appellant) (Respondent) Assessee By Sh. K.V.S.R. Krishana, Ca Department By Sh. Dayainder Singh Sidhu, Cit(Dr)

Section 143(3)Section 14ASection 36(1)Section 36(2)(v)

primary co-operative agricultural and rural development bank; (v) a housing finance company; and (vi) any other financial corporation including a public company; (b) "eligible business" means,- (i) in respect of the specified entity referred to in sub-clause (1) or sub- clause (ii) or sub-clause

Jayanti S Kundhadiya, Assistant Commissioner of Income Tax, Central Circle-2(1), Pune vs. Patil Construction and Infrastructure Limited, Mumbai

In the result, all the three appeals filed by the Revenue are allowed for statistical purposes

ITA 231/PUN/2025[2015-16]Status: DisposedITAT Pune23 Oct 2025AY 2015-16

Bench: Shri R. K. Panda & Ms Astha Chandra

For Appellant: S/Shri Rajiv KhandelwalFor Respondent: Shri Amit Bobde, CIT

Section 143(2)Section 80

response to the above filed certain documents which include copy of Form No.10CCB and chart showing working of computation of profit derived from eligible business u/s 80-IA of the Act. The assessee also submitted copies of ledger account and extracts of some bills in support of income received ... argued that the assessee has filed certain documents which include Form 10CCB and chart showing working of computation of profit derived from eligible business u/s 80IA. The assessee had also submitted copies of ledger account and extracts of some bills in support of income received. It was argued that

Jayanti S Kundhadiya, Assistant Commissioner of Income Tax, Central Circle-2(1), Pune vs. Patil Construction and Infrastructure Limited, Mumbai

In the result, all the three appeals filed by the Revenue are allowed for statistical purposes

ITA 230/PUN/2025[2014-15]Status: DisposedITAT Pune23 Oct 2025AY 2014-15

Bench: Shri R. K. Panda & Ms Astha Chandra

For Appellant: S/Shri Rajiv KhandelwalFor Respondent: Shri Amit Bobde, CIT

Section 143(2)Section 80

Assistant Commissioner of Income Tax Central Circle 2(1), Pune vs. Patil Construction and Infrastructure Limited, Mumbai

In the result, all the three appeals filed by the Revenue are allowed for statistical purposes

ITA 229/PUN/2025[2013-14]Status: DisposedITAT Pune23 Oct 2025AY 2013-14

Bench: Shri R. K. Panda & Ms Astha Chandra

For Appellant: S/Shri Rajiv KhandelwalFor Respondent: Shri Amit Bobde, CIT

Section 143(2)Section 80

Tata Communications Ltd., Mumbai vs. DCIT-1(3)(1), Mumbai

In the result, the appeal filed by the assessee is allowed

ITA 1978/MUM/2024[1999-2000]Status: DisposedITAT Mumbai22 Oct 2025AY 1999-2000

Bench: Shri Saktijit Dey & Shri Arun Khodpia

For Appellant: Shri J. D. MistriFor Respondent: Shri Ritesh Misra

Section 80I

telecommunication services, whether basic or cellular, including radio paging, domestic satellite service or network of trunking and EDI services were also treated as eligible business for claiming deduction. He submitted, sub section (4C) of section 80IA of the Act applicable to the assessment year under dispute sets out the conditions ... cellular, other services including radio paging, domestic satellite service or network of trunking and electronic data interchange services were also included within the eligible business. Sub section (4C) to section 80IA of the Act sets out the conditions for eligibility of an undertaking providing telecommunication services whether basic or cellular

Radiant Textiles Private Limited, Patiala vs. ACIT, Circle, Patiala

In the result, the appeal stands dismissed

ITA 444/CHANDI/2025[2019-20]Status: DisposedITAT Chandigarh14 Oct 2025AY 2019-20

Bench: Hon’Ble Shri Rajpal Yadav & Hon’Ble Shri Manoj Kumar Aggarwal, Am आयकर अपील सं./ Ita No.444/Chandi/2025 (िनधा"रण वष" / Assessment Year: 2019-20) M/S Radiant Textiles Pvt. Ltd. Acit Circle Patiala बनाम/ Village Chounth, Patiala Road Aaykar Bhawan Vs. Samana-147101 Patiala 147001 "ायीलेखासं./जीआइआरसं./Pan/Gir No. Aadcr-1175-R (अपीलाथ"/Appellant) (""थ" / Respondent) : अपीलाथ"कीओरसे/ Appellant By : Shri Parikshit Aggarwal (Ca) – Ld. Ar ""थ"कीओरसे/Respondent By : Smt. Kusum Bansal (Cit) – Ld. Dr सुनवाईकीतारीख/Date Of Hearing : 10-09-2025 घोषणाकीतारीख /Date Of Pronouncement : 14/10/2025 आदेश / O R D E R Manoj Kumar Aggarwal () 1. Aforesaid Appeal By Assessee For Assessment Year (Ay) 2019-20 Arises Out Of An Order Of Learned Commissioner Of Income Tax (Appeals), National Faceless Appeal Centre (Nfac), Delhi [Cit(A)] Dated 13-02-2025 In The Matter Of A Rectification Order Passed By Ld. Assessing Officer [Ao] U/S. 154 Of The Act On 28-11-2023. The Only Grievance Of The Assessee Is Application Of Correct Rates Of Taxes.

For Appellant: Shri Parikshit Aggarwal (CA) – Ld. ARFor Respondent: Smt. Kusum Bansal (CIT) – Ld. DR

Section 145ASection 154

from the schemes framed by Central Government or from s. 75 of the Customs Act, 1962, hence, incentives profits are notprofits derived from the eligible business under s. 80 IB. They belong to the category of ancillary profits of such undertakings. we are satisfied that the remission of duty

DCIT 4(3)(1), Mumbai vs. Jm Financial Services Pvt. Ltd., Mumbai

In the result, the appeals filed by the revenue are allowed and the appeals filed by the assessee are allowed for statistical purpose

ITA 6362/MUM/2018[2013-14]Status: DisposedITAT Mumbai14 Oct 2025AY 2013-14

Bench: SHRI NARENDRA KUMAR BILLAIYA (Accountant Member), SHRI PAWAN SINGH (Judicial Member)

Section 255Section 43Section 43(5)Section 73Section 73(4)

disadvantage of an assessee so as to give it a different meaning and thereby denying the assessee the set off of otherwise eligible business loss from one segment as against the other segment, especially when the activity done by the assessee is a composite activity and profit and loss

Jm Financial Services Ltd., Mumbai vs. DCIT - Circle -4(3)(1), Mumbai

In the result, the appeals filed by the revenue are allowed and the appeals filed by the assessee are allowed for statistical purpose

ITA 6114/MUM/2018[2013-14]Status: DisposedITAT Mumbai14 Oct 2025AY 2013-14

Bench: SHRI NARENDRA KUMAR BILLAIYA (Accountant Member), SHRI PAWAN SINGH (Judicial Member)

Section 255Section 43Section 43(5)Section 73Section 73(4)