Interest Income Earned By A Co-Operative Society Eligible For Deduction: ITAT

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) held that interest income earned by a co-operative society on its investments held with co-operative banks would be eligible for claim of deduction under section 80P(2)(d) of the Income Tax Act.

The two-member bench of Kuldip Singh (Judicial Member) and S Rifaur Rahman (Accountant Member) found that the CIT(A) erred in upholding the assessee's denial of deduction under Section 80P(2)(d).

The appellant/assessee, a cooperative society, has claimed disallowance or deduction under Section 80P (2)(d) for the interest of Rs. 6,96,725/- paid on funds parked with Saraswat Co-Operative Bank, Sham Vithal Rao Co-Operative Bank, and district central cooperative bank.

However, the Assessing Officer has disallowed the deduction claimed by the assessee. The assessee brought the matter before the CIT(A) by filing an appeal, which was confirmed by the appeal's dismissal.

The tribunal held that the assessee society, which has earned an amount of Rs. 6,96,725 from its investment of surplus funds with cooperative banks, is entitled to a deduction under Section 80P(2)(d).

The ITAT directed the AO to allow deductions under Section 80P(2)(d) to the assessee.

Case Title: Amore Commercial Premises Co-Op Society Ltd. Versus Central Processing Centre

Citation: ITA No.2873/M/2022

Date: 17.01.2023

Counsel For Appellant: Sashi Bekal

Counsel For Respondent: Ashish Kumar Deharia

Click Here To Read The Order