M/S MAHARASHTRA J P A H P E C C S LTD,PUNE V. ITO WARD 7(1), PUNE

ITA 1021/PUN/2025

AI Insights

The case revolves around the denial of a deduction under section 80P(2)(d) of the Income-tax Act, 1961, by the Income Tax Officer, Ward-7(1), Pune, to M/s. Maharashtra J P A H P E C C S Ltd. The deduction was for interest income amounting to Rs.17,51,124 earned from deposits with Pune District Central Cooperative Bank Ltd. The lower authorities contended that PDCC is not a Cooperative Society, thus not eligible for the deduction. However, the Tribunal, referencing several precedents, concluded that interest income from Cooperative Banks is eligible for deduction under section 80P(2)(d), as these banks are essentially Cooperative Societies that have obtained banking licenses.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 652935 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2020-2021
• Other Referred Cases: Satara Z.P. Class Four Employess Co.op Credit Society Ltd. Vs. ITO, The Ugar Sugar Works Kamgar & Dr. Shirgaokar Shaikshanik Trust Nokar Co-op Credit Society vs. ITO, Kolhapur District Central Co-op. Bank Kanista Sevakanchi Sahakar Pat Sanstha Ltd., Vs. ITO, Annapurna Nagari Sahkari Pathsanstha Maryadit Yawal Vs. ITO, Kolhapur District Central Co-op. Bank Kanista Sevakanchi Sahakar Pat Sanstha Ltd., Vs. ITO
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DAYANAND JAWALIKAR
• Assessee Lawyers: VISHANK CHAUDHARI
• Keywords: Set aside; Additional evidence

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “SMC”, PUNE BEFORE DR.MANISH BORAD, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.1021/PUN/2025 Assessment Year : 2020-21 M/s. Maharashtra J P A H P E C C S Ltd. Pune Military Water Supply Compound, Near St Mary School, Pune 411 001, Maharashtra PAN : AABTM7153P Vs. Income Tax Officer, Ward-7(1), Pune Appellant Respondent आदेश / ORDER PER DR. MANISH BORAD, ACCOUNTANT MEMBER : This appeal filed by the assessee pertaining to the assessment year 2020-21 is directed against the order dated 24.03.2025 giving effect to the order of CIT(A) passed u/s.250 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) which inturn is arising out of the Assessment Order dated. 26.09.2022 passed u/s.143(3) r.w.s.144B of the Act. 2. In the instant appeal, assessee has raised following grounds of appeal : “1. On the facts and in the circumstances of the case and in law Ld. A.O. erred in rejected Claim interest on deposits held in co-operative Bank under section 80P(2)(d) of Rs.17,51,124/- being Pune District Central Co- op Ltd, Pune is scheduled bank and not cooperative Bank which is bad in law because PDCC Bank is registered under the Maharashtra Cooperative Society Act, with the Divisional Joint Registrar Co-op Society Pune division having signed its registration certificate.Hence order passed in consequence to that may kindly be quashed.” Assessee by : Shri Vishank Chaudhari Revenue by : Shri Dayanand Jawalikar Date of hearing : 10.06.2025 Date of pronouncement : 16.06.2025 ITA No.1021/PUN/2025 M/s. Maharashtra J P A H P E C C S Ltd. 2 3. At the outset, Ld. Counsel for the assessee submitted that ld.CIT(A) erred in not allowing the claim of deduction u/s.80P(2)(d) of the Act for the interest income of Rs.17,51,124/- earned by the assessee from investments made with Pune District Central Cooperative Bank Ltd. (PDCC). He submitted that the issue stands squarely covered by plethora of decisions of this Tribunal placing reliance on the following decisions and ld. Departmental Representative did not controvert this contention. 1. Satara Z.P. Class Four Employess Co.op Credit Society Ltd. Vs. ITO in ITA No.2374/PUN/2024, dated 07.01.2025 2. The Ugar Sugar Works Kamgar & Dr. Shirgaokar Shaikshanik Trust Nokar Co-op Credit Society vs. ITO in ITA No.84/PAN/2018, dated 18.11.2021 3. Kolhapur District Central Co-op. Bank Kanista Sevakanchi Sahakar Pat Sanstha Ltd., Vs. ITO in ITA No.1365/PUN/2023, dated 01.01.2024 4. We have heard the rival contentions and perused the record placed before us. It is an admitted fact that impugned addition is regarding denial of deduction u/s.80P(2)(d) of the Act for the interest income earned from Cooperative Bank namely PDCC at Rs.17,51,124/-. Lower authorities have denied the deduction as PDCC is not a Cooperative Society. Before us, assessee has furnished paper book and referring to page 12 of the paper book our attention has been drawn to Certificate of Registration as per which Registrar of Cooperative Societies, Bombay Presidency has certified that PDCC Ltd, has been registered u/s.9 of the Act, 1992 and assessee is basically a Cooperative Bank registered under Maharashtra Cooperative Societies Act, 1960. 5. This issue is no longer res integra by virtue of catena of decisions taking consistent view that interest income earned from deposits with Cooperative Banks is eligible for deduction ITA No.1021/PUN/2025 M/s. Maharashtra J P A H P E C C S Ltd. 3 u/s.80P(2)(d) of the Act. Recently, this Bench in the case of Annapurna Nagari Sahkari Pathsanstha Maryadit Yawal Vs. ITO in ITA No.313/PUN/2025, order dated 07.05.2025 has allowed the deduction claimed by the assessee u/s.80P(2)(d) of the Act observing as under : “5. We have heard the rival submissions and perused the record placed before us. There is no dispute to the fact that assessee has earned interest income of Rs.1,02,95,103/- from deposits/investments with Cooperative Banks. This fact has been accepted by the Assessing Officer in the assessment order also. Admittedly, assessee has not filed the requisite details before ld.CIT(A). We however considering the fact that the issue regarding allowability of deduction u/s.80P(2)(d) of the Act for the interest earned from Cooperative Banks is no longer res integra as the very same issue has been decided by this Tribunal in catena of decisions and in assesse’s own case for A.Y. 2020-21 holding that the assessee is eligible for deduction u/s.80P(2)(d) of the Act as the Cooperative Banks are basically Cooperative Societies. For the sake of brevity, the finding given in ITA No.2471/PUN/2024 is reproduced below : “7. We have heard both the sides and perused the record placed before us. In the instant case, the Assessing Officer disallowed the interest income of Rs.1,63,98,998/- earned out of the Fixed deposits/Investments made with Cooperative Banks treating the same as Income from Other Source. Ld.CIT(A) dismissed the appeal in limine without discussing anything on merits of the issues and on the ground that the assessee has not provided plausible explanation for admission of additional evidences. 8. Section 80P(2)(d) of the Act provides that the sum received in respect of any income by way of interest or dividend derived by Cooperative Society from its investment with any other Cooperative Society, the whole of such income is eligible for deduction u/s.80P of the Act. we find that this issue is no more res integra as the Coordinate Benches of this Tribunal has been consistently holding that the interest income earned out of the FDs/Investments kept with Cooperative Banks is allowable u/s.80P(2)(d) of the Act. We find that this Tribunal in case of Kolhapur District Central Co-op. Bank Kanista Sevakanchi Sahakar Pat Sanstha Ltd., Vs. ITO in ITA No.1365/PUN/2023, dated 01.01.2024 dealing with similar issue after placing reliance on another decision of this Tribunal in the case of The Ugar Sugar Works Kamgar & Dr. Shirgaokar Shaikshanik Trust Nokar Co-op Credit Society vs. ITO in ITA ITA No.1021/PUN/2025 M/s. Maharashtra J P A H P E C C S Ltd. 4 No.84/PAN/2018, dated 27.05.2022 has held that the interest earned from deposits with Cooperative Banks are also eligible for deduction u/s.80P(2)(d) of the Act as Cooperative Banks are basically Cooperative Societies only but have turned into Bank on getting necessary banking license. 9. Respectfully following the above referred decisions taking consistent view along with considering the facts of the case, where the assessee made investment with the Cooperative Banks we hold that the assessee is eligible for deduction u/s.80P(2)(d) of the Act for the interest income earned from Cooperative Banks at Rs.1,63,98,998/-. Findings of the ld. CIT(A) is set-aside and the Assessing Officer is directed to allow the claim made by the assessee. Effective grounds of appeal raised by the assessee are allowed.” 6. Respectfully following the same, we hold that deduction of Rs.1,02,95,103/- u/s.80P(2)(d) of the Act claimed by the assessee on the interest earned from deposits/Investments with Cooperative Banks deserves to be allowed. Relevant finding of ld.CIT(A) on merits is set aside and grounds of appeal No.5 to 8 raised by the assessee are allowed.” 6. Respectfully following the same, we hold that deduction claimed by the assessee on the interest income earned from deposits/Investments with PDCC u/s.80P(2)(d) of the Act at Rs.17,51,124/- deserves to be allowed. Impugned finding of ld.CIT(A) is set aside and effective Grounds of appeal raised by the assessee are allowed. 7. In the result, appeal of the assessee is allowed. Order pronounced on this 16th day of June, 2025. Sd/- (MANISH BORAD) ACCOUNTANT MEMBER पुणे / Pune; \u0001दनांक / Dated : 16th June, 2025. Satish ITA No.1021/PUN/2025 M/s. Maharashtra J P A H P E C C S Ltd. 5 आदेश क\u0002 \u0003ितिलिप अ ेिषत / Copy of the Order forwarded to : 1. अपीलाथ / The Appellant. 2. \u000eयथ / The Respondent. 3. The Pr. CIT concerned. 4. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण, “SMC” ब\u0014च, पुणे / DR, ITAT, “SMC” Bench, Pune. 5. गाड\u0004 फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune "