PRATAP HERITAGE CO OPERATIVE HOUSING SOCIETY LTD ,MUMBAI V. ITO 42(1)(4), MUMBAI

ITA 676/MUM/2025

AI Insights

The case involves Pratap Heritage Co-Operative Housing Society Ltd., which appealed against the order of the CIT(A), NFAC, Delhi, which was passed under section 250 of the Income Tax Act, 1961. The primary issue was the denial of a deduction of Rs. 9,41,015 under section 80P(2)(d) by the Assessing Officer, which was upheld by the CIT(A). The deduction pertained to interest income from cooperative banks. The Tribunal examined whether the income from these banks qualifies for deduction under the specified section, considering various precedents and the nature of cooperative banks.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 470730 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2020-2021
• Other Referred Cases: PCIT vs. Totagars Co-operative Sale Society, Pathare Prabhu Co-operative Housing Society Ltd. vs. ITO
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH MESHRAM
• Assessee Lawyers: SHARAD SETH
• Section: 250; 2

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER ITA No. 676/MUM/2025 Assessment Year : 2020-21 Pratap Heritage Co-Operative Housing Society Ltd., Society Office, Pratap Heritage CHS Ltd., L.T. Road, Borivalli West, Mumbai - 400092. PAN No. AAABP0909M ……………. Appellant Versus ITO – 42(1)(4), Kautilya Bhavan, Bandra Kurla Complex, Bandra (East), Mumbai-400051. ……………. Respondent Assessee by : Shri Sharad Seth-CA/ AR Revenue by : Shri Rajesh Meshram, Sr. DR Date of Hearing – 24/03/2025 Date of Order – 25/03/2025 Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER; 1. The appeal by the assessee is directed against the order passed by the CIT(A), NFAC, Delhi dated 27.12.2024 passed under section 250 2 ITA No. 676/Mum/2025 Pratap Heritage Co-operative Housing Society Ltd. of the Income Tax Act, 1961 (“the Act”) for the assessment year 2020-21. The assessee has raised the following grounds of appeal: “1. The order dt.27h December,2024 of The Learned Commissioner of Income Tax (Appeals) (hereinafter referred to as \"Ld. CIT (A)\") passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as \"Act\" for sake of brevity) is bad in law and on facts. 2. GROUNDS RELATING ALLOWANCE OF DECUTION OF RS. 9,41,015/- U/S. 8OP(2)(d): 2.1 In the facts and circumstances of the case and especially in law, the Ld. CIT(A) has erred in not allowing deduction u/s 80P(2)(d) amounting to Rs. 9,41,015/-, being interest income from Co- operative Banks contending that the income received by the appellant is from cooperative banks and not co-operative societies. 2.2 The Ld. CIT(A) erred in in not appreciating the fact that The Shamrao Vithal Co-op. Bank Ltd. (SVC Bank) and Saraswat Co. Operative Bank are registered under The Multi-State Co-operative Societies Act, 2002 and the Maharashtra State Co. Operative Bank is registered under the Maharashtra Co. Operative Societies Act, 1960. 2.3 The Ld. CIT(A) erred in relying on Supreme Court decision having different facts and not considering jurisdictional judgments having same issue and facts as that of appellant.” 2. The rival submissions of both the parties have been heard and record perused. The learned authorised representative (ld.AR) of the assessee submitted that assessee is a co-operative housing society. While filing return of income, the assessee in its computation of total income claimed deduction of Rs.9,41,015/- under section 80P(2)(d) of the Act. The assessee received interest on fixed deposit with (i) The Saraswat Co-operative Bank of Rs.834,576/- (ii) The Shamrao Vithal Co-operative Bank of Rs.42,655/- (iii) The Maharashtra State Co-operative Bank of Rs.63,784/-. The Assessing Officer (AO) while 3 ITA No. 676/Mum/2025 Pratap Heritage Co-operative Housing Society Ltd. passing assessment order disallowed such deduction under section 80P(2)(d), which was upheld by ld CIT(A). The learned AR of the assessee submitted that in series of decision by Mumbai Tribunal, it has been held that co-operative banks are primarily a co-operative society. Thus, interest or dividend received from such Co-operative Banks are eligible for deduction under section 80P(2)(d). The figure of interest is not disputed by lower authorities. In fact, the grounds of appeal raised by assessee is covered in favour of the assessee. To support his contentions, the learned AR of the assessee also relied upon the decision of Karnataka High Court in PCIT vs. Totagars Co- operative Sale Society, (2017) 392 ITR 74 (Karnataka), decision of Mumbai Tribunal in the case of Pathare Prabhu Co-operative Housing Society Ltd. vs. ITO, in ITA No.1346/Mum./2023 dated 27.07.2023. 3. On the other hand, learned senior departmental representative (Sr.DR) for the Revenue supported the order of lower authorities. 4. We have considered the submissions of both the parties and have gone through the orders of lower authorities. We have also deliberated on various case laws relied upon by the learned AR of the assessee. We find that grounds of appeal raised by the assessee is in fact covered by a series of decision by this Bench as well as other Co-ordinate Benches of Tribunal wherein it has been consistently held that Co-operative Banks are primarily co-operative society and the interest or dividend earned from such Co-operative Bank are eligible 4 ITA No. 676/Mum/2025 Pratap Heritage Co-operative Housing Society Ltd. for deduction under section 80P(2)(d). No contrary facts or law is brought to our notice to take other view. Thus, the grounds of appeal raised by the assessee are allowed. 5. In the result, the grounds of appeal raised by the assessee are allowed. Order pronounced in the open Court on 25/03/2025. Sd/- GIRISH AGRAWAL ACCOUNTANT MEMBER Sd/- PAWAN SINGH JUDICIAL MEMBER MUMBAI, DATED: 25/03/2025 Prabhat Copy of the order forwarded to: (1) The Assessee; (2) The Revenue; (3) The PCIT / CIT (Judicial); (4) The DR, ITAT, Mumbai; and (5) Guard file. By Order Assistant Registrar ITAT, Mumbai "