Section 80P(2)(a)(iii) of the Income Tax Act
Income-tax Act, 2025: s.149
Section 80P(2)(a)(iii) falls under section 80P of the Income-tax Act, 1961, which corresponds to section 149 (Deduction in respect of income of co-operative societies) of the Income-tax Act, 2025.
Read section 149 of the 2025 Act
Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.
The decision most relied on for Section 80P(2)(a)(iii) is Gramin Sewa Sahakari Samiti Maryadit v. Income Tax Officer (138 Taxmann.com 476), cited in 24 of the 73 judgments on BharatTax that turn on this section.
Leading authorities on Section 80P(2)(a)(iii)
Interest earned by a cooperative society from deposits with cooperative banks and nationalized banks is eligible for deduction under Section 80P(2)(a) of the Income Tax Act. Such interest is considered attributable to the business of the cooperative society, especially when deposits are statutorily required.
Interest earned by a cooperative society on fixed deposits with a bank or co-operative society is eligible for deduction under Section 80P(2)(a)(iii) if it is directly linked to and attributable to the society's primary activity of marketing agricultural produce grown by its members.
Interest earned by co-operative societies on fixed deposits with banks and other co-operative societies is includible in their total income, unless it falls within the specific exemptions provided by Section 80P(2) of the Income Tax Act.