Subordinate Engineers Association, Kolhapur V. Income Tax Officer, Ward-2(2), Kolhapur, Kolhapur

ITA 261/PUN/2023

AI Insights

The case involves the Subordinate Engineers Association MSEB Co.op. Credit Society Ltd., which appealed against the order of the CIT(A) denying them a deduction under section 80P(2)(a)(i) of the Income-tax Act, 1961. The deduction was claimed on interest income earned from deposits with Oriental Bank Ltd., Kolhapur. The Assessing Officer and the CIT(A) had both denied the deduction, leading to the appeal before the Tribunal. The Tribunal, referencing previous decisions and the lack of a direct judgment from the jurisdictional High Court, decided in favor of the assessee, allowing the deduction.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 124105 (ITAT-PUNE)
• Duration Of Justice: 2 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-05-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 11-05-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 07-03-2023
• Other Referred Cases: Sureshdada Jain Nagari Sahakari Patsanstha Maryadit Vs. The Pr.CIT, Shri Laxmi Narayan Nagari Sahakari Pat Sanstha Maryadit Vs. ITO, Tumkur Merchants Souharda Credit Cooperative Ltd. Vs. ITO, Mantola Cooperative Thrift Credit Society Ltd. Vs. CIT, Totgar's Cooperative Sale Society Ltd.
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 80P

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, PUNE BEFORE SHRI R.S. SYAL, VICE PRESIDENT आयकर अपील सं. /ITA No.261/PUN/2023 नधा रण वष / Assessment Year : 2017-18 Subordinate Engineers Association MSEB Co.op. Credit Society Ltd., C.S.No.227/1, Plot No5, E-Ward, Tarabai Park, Near Kran Bunglow, Kolhapur – 416 003 Maharashtra PAN : AACAM3801A Vs. ITO, Ward-2(2), Kolhapur Appellant Respondent आदेश / ORDER PER R.S. SYAL, VP: This appeal by the assessee arises out of the order dated 16-01-2023 passed by the CIT(A) in National Faceless Appeal Centre, Delhi u/s.250 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) in relation to the assessment year 2017-18. 2. Succinctly, the facts of the case are that the assessee is a credit cooperative society engaged in the business of providing banking or credit facilities to its members. The assessee filed Assessee by : None Revenue by : Ms. Neha Deshpande Date of hearing 12-05-2023 Date of pronouncement 16-05-2023 ITA No.261/PUN/2023 Subordinate Engineers Association MSEB Co.op. Credit Society Ltd., 2 return claiming deduction u/s.80P(2)(a)(i) of the Act in relation to interest income earned from a nationalized bank, namely, Oriental Bank Ltd., Kolhapur amounting to Rs.5,16,876/-. The Assessing Officer denied the benefit of deduction u/s.80P, which came to be countenanced in the first appeal. Aggrieved thereby, the assessee has come up in appeal before the Tribunal. 3. I have heard the ld. DR and gone through the relevant material on record. There is no appearance from the side of the assessee despite notice. The sole issue agitated in the extant appeal on the allowability of deduction u/s.8P(2)(a)(i) is no more res integra. I find the Pune Tribunal in Sureshdada Jain Nagari Sahakari Patsanstha Maryadit Vs. The Pr.CIT (ITA No.713/PUN/2016) has decided the question of availability of deduction u/s 80P on interest income by noticing that the Pune Bench in an earlier case of Shri Laxmi Narayan Nagari Sahakari Pat Sanstha Maryadit Vs. ITO (ITA No.604/PN/2014) has allowed similar deduction. In the said case, the Tribunal discussed the contrary views expressed by the Hon’ble Karnataka High Court in Tumkur Merchants Souharda Credit Cooperative Ltd. Vs. ITO (2015) 230 Taxman 309 (Kar.) allowing deduction u/s. 80P on interest income and that of the Hon’ble Delhi High Court in ITA No.261/PUN/2023 Subordinate Engineers Association MSEB Co.op. Credit Society Ltd., 3 Mantola Cooperative Thrift Credit Society Ltd. Vs. CIT (2014) 110 DTR 89 (Delhi) not allowing deduction u/s.80P on interest income earned from banks. Both the Hon’ble High Courts took into consideration the ratio laid down in the case of Totgar’s Cooperative Sale Society Ltd. (supra). No direct judgment from the Hon’ble jurisdictional High Court on the point having been pointed out, the Tribunal in Shri Laxmi Narayan Nagari Sahakari Pat Sanstha Maryadit (supra) preferred to go with the view in favour of the assessee by the Hon’ble Karnataka High Court in the case of Tumkur Merchants Souharda Credit Cooperative Ltd. (supra). The position continues to remain the same before this Tribunal also. Respectfully following the precedent, the impugned order is overturned and the interest income earned from the deposits kept with nationalised bank amounting to Rs.5,16,876/- is allowed as deduction u/s.80P(2)(a)(i) of the Act. 4. In the result, the appeal is allowed. Order pronounced in the Open Court on 16 th May, 2023. Sd/- (R.S.SYAL) VICE PRESIDENT पुणे Pune; िदनांक Dated : 16 th May, 2023 सतीश ITA No.261/PUN/2023 Subordinate Engineers Association MSEB Co.op. Credit Society Ltd., 4 आदेश की ितिलिप अ ेिषत/Copy of the Order is forwarded to : 1. अपीलाथ / The Appellant; 2. थ / The Respondent 3. 4. 5. The Pr.CIT concerned DR, ITAT, ‘SMC’ Bench, Pune गाड फाईल / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune Date 1. Draft dictated on 12-05-2023 Sr.PS 2. Draft placed before author 16-05-2023 Sr.PS 3. Draft proposed & placed before the second member JM 4. Draft discussed/approved by Second Member. JM 5. Approved Draft comes to the Sr.PS/PS Sr.PS 6. Kept for pronouncement on Sr.PS 7. Date of uploading order Sr.PS 8. File sent to the Bench Clerk Sr.PS 9. Date on which file goes to the Head Clerk 10. Date on which file goes to the A.R. 11. Date of dispatch of Order. *