Sukhakarta Nagari Sahakari Patsanstha Maryadit, Pune, Pune V. Income Tax Officer, Ward-7(3), Pune, Pune

ITA 347/PUN/2023

AI Insights

The case involves Sukhakarta Nagari Sahakari Patsanstha Maryadit, a cooperative credit society, which appealed against the denial of deduction on interest income earned from Maharashtra Gramin Bank for the assessment years 2017-18 and 2018-19. The Assessing Officer had denied the deduction citing that the interest income was not eligible under section 80P(2)(d) as it was not earned from a cooperative society. The Commissioner of Income Tax (Appeals) upheld this decision. However, the Tribunal, referencing a precedent set by the Pune Bench in Rena Sahakari Sakhar Karkhana Ltd. Vs. Pr.CIT, reversed the lower authorities' decisions, allowing the deduction.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 124190 (ITAT-PUNE)
• Duration Of Justice: 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-04-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 19-04-2023
• Assessment Year: 2017-2018
• Appeal Filed On: 27-03-2023
• Other Referred Cases: Rena Sahakari Sakhar Karkhana Ltd. Vs. Pr.CIT (ITA No.1249/PUN/2018)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 80P; 2(19)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, PUNE BEFORE SHRI R.S. SYAL, VICE PRESIDENT आयकर अपील सं. /ITA Nos.347 & 348/PUN/2023 नधा रण वष / Assessment Years : 2017-18 & 2018-19 Sukhakarta Nagari Sahakari Patsanstha Maryadit, Flat No.4, Plot No.41/4, Nilesh Angan, Ganesh Nagar, Wadgaon Sheri, Nagar Road, Pune – 411 014, Maharashtra PAN : AAABS2501G Vs. ITO, Ward-7(3), Pune Appellant Respondent आदेश / ORDER PER R.S. SYAL, VP: These two appeals by the assessee relate to the assessment years 2017-18 and 2018-19. 2. The only issue raised in both the appeals is against the denial of deduction u/s.80P of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) on interest income earned from Maharashtra Gramin Bank. 3. Tersely, the facts of the case for the first assessment year are that the assessee is a cooperative credit society which filed return Assessee by None Revenue by Shri Ganesh B. Budruk Date of hearing 20-04-2023 Date of pronouncement 21-04-2023 ITA No.347 & 348/PUN/2023 Sukhakarta Nagari Sahakari Patsanstha Maryadit 2 declaring total income at Nil. The Assessing Officer (AO), during the course of assessment proceedings, found that the assessee had earned interest of Rs.3,79,582/- from Maharashtra Gramin Bank on which deduction was claimed u/s 80P of the Act. Invoking provisions of section 80P(2)(d), he held that the deduction was allowable on interest income only if it was earned from a cooperative society and not otherwise. The ld. CIT(A) upheld the contention of the AO, against which the assessee has come up in appeal before the Tribunal. 4. 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. I am, therefore, proceeding to dispose of the appeal ex parte qua the assessee. 5. It is seen that the question is of granting deduction u/s 80P of the Act on interest income earned from Maharashtra Gramin Bank. The extant issue is no more res integra in view of the catena of decisions delivered by the Pune Benches. The Pune Bench in Rena Sahakari Sakhar Karkhana Ltd. Vs. Pr.CIT (ITA No.1249/PUN/2018) has held, vide its order dated 07-01-2022, that ITA No.347 & 348/PUN/2023 Sukhakarta Nagari Sahakari Patsanstha Maryadit 3 though co-operative banks, other than primary agricultural credit society or a primary co-operative agricultural and rural development bank, are not eligible for deduction pursuant to insertion of section 80P(4) w.e.f. 1.4.2007, but this provision does not dent the otherwise eligibility u/s 80P(2)(d) of the Act of a co-operative society on interest income on investments/deposits parked with a co-operative bank, which is a registered co-operative society as per section 2(19) of the Act, defining co-operative society to mean a co-operative society registered under the Co-operative Societies Act, 1912 or under any law for the time being in force. The payer of interest is also a Co-operative society registered under the Cooperative Societies Act. Respectfully following the decision of the Division Bench, I overturn the impugned order and direct to grant deduction u/s.80P(2)(d) of the Act on the amount of interest earned from Maharashtra Gramin Bank. 6. The facts for the A.Y. 2018-19 are mutatis mutandis similar. For this year, the AO denied deduction u/s.80P in respect of interest income of Rs.2,59,128/- received from Maharashtra Gramin Bank, which came to be countenanced in the first appeal. ITA No.347 & 348/PUN/2023 Sukhakarta Nagari Sahakari Patsanstha Maryadit 4 7. After hearing the ld DR and perusing the material on record, it is seen that the facts and circumstances of this appeal are similar to those of the immediately preceding assessment year, which has been disposed of herein above. Following the view taken in such earlier year, I reverse the impugned order and direct the AO to grant the deduction on such interest income. 8. In the result, both the appeals are allowed. Order pronounced in the Open Court on 21 st April, 2023. Sd/- ( R.S.SYAL) VICE PRESIDENT पुणे Pune; िदनांक Dated : 21 st April, 2023 सतीश 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 ITA No.347 & 348/PUN/2023 Sukhakarta Nagari Sahakari Patsanstha Maryadit 5 Date 1. Draft dictated on 20-04-2023 Sr.PS 2. Draft placed before author 21-04-2023 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. *