SHAH NIVAS COOP HSG SOCIETY LTD,MUMBAI V. ITO WARD 25(1)(1), MUMBAI

ITA 2770/MUM/2025

AI Insights

The case involves Shah Nivas Co. Op. Hsg. Society Ltd., the appellant, contesting the decision of the Learned Additional/Joint Commissioner of Income-tax (Appeals), Kolkata-2, which denied them a deduction under section 80P(2)(d) for interest income from Saraswat Cooperative Bank, Cosmo Cooperative Bank, and Mumbai District Central Cooperative Bank. The primary legal contention was whether these banks qualify as cooperative societies under the relevant provisions of the Income-tax Act, 1961. The Tribunal's decision was influenced by precedents and interpretations from various High Courts and other ITAT benches, which supported the appellant's position.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 668729 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2021-2022
• Other Referred Cases: Chandubhai Waghela vs NFAC, PCIT vs Ashwin Kumar Urban Cooperative Society Ltd., Uppinangady Catholic Multipurpose Co-operative Society Ltd. Vs ITO, CIT Vs. Godavari Saraf
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAM KRISHN KEDIA
• Assessee Lawyers: ASHOK MEHTA
• Keywords: Principle of natural justice

Judgement Text

" |आयकर अपीलीय न्यायाधिकरण न्यायपीठ, म ुंबई| IN THE INCOME-TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI BEFORE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER आयकर अपील सुं./ITA No. 2770/MUM/2025 (नििाारण वर्ा / Assessment Year :2021-22) Shah Nivas Co. Op. Hsg. Society Ltd. 65, Abhishek, S. V. Road, Irla Bridge, Mumbai, Maharashtra-400058 v/s. बिाम ITO Ward 25(1)(1) Kautilya Bhavan, Bandra Kurla Complex, Mumbai- 400051 स्थायी लेखा सं./जीआइआर सं./PAN/GIR No: AADTS9314E Appellant/अपीलार्थी .. Respondent/प्रनिवादी निर्ााररती की ओर से /Assessee by: Shri Ashok Mehta राजस्व की ओर से /Revenue by: Shri Ram Krishn Kedia स िवाई की िारीख / Date of Hearing 17.06.2025 घोर्णा की िारीख/Date of Pronouncement 24.06.2025 आदेश / O R D E R PER SANDEEP GOSAIN [J.M.]:- This appeal is filed by the assessee against the order of the Learned Additional/Joint Commissioner of Income-tax (Appeals), Kolkata-2 [hereinafter referred to as “CIT(A)”] dated 31.03.2025 passed u/s. 250 of the Income-tax Act, 1961 [hereinafter referred to as “Act”] for Assessment Year [A.Y.] 2021-22. 2. The assessee has raised the following grounds of appeal: P a g e | 2 ITA No. 2770/Mum/2025 A.Y. 2021-22 Shah Nivas Co. Op. HSG. Society Ltd. “1. The Learned Assessing Officer at CPC Bangalore and Learned CIT Appeals erred in assessing the income at Rs 25,31,290/- instead of Rs 11,64,030/- as represented by the assessee. 2. The Learned Assessing Officer at CPC Bangalore and Learned CIT Appeals erred in confirming an addition on debatable issue based on surmises and conjectures and recording wrong facts. 3. The Learned CIT Appeals erred in not granting video conferencing in spite of specific request made by the assessee stating it as \"conditional\" in violation of the Hon'ble Gujarat High Court in the case of Chandubhai Waghela vs NFAC (Gujarat High Court Special Civil Application No 8552 of 2022) and not following Rule 12(3) of the Faceless Appeal Scheme 2021 issued by the, Central Board of Direct Taxes (CBDT). 4. The Learned Assessing Officer at CPC Bangalore and Learned CIT Appeals erred in not granting deduction u/s 80P(2)(d) of Rs 13,67,260/-without any application of mind and without considering documents, records and case- laws made available before him. 5. A) The Learned CIT Appeals errored in disallowing the deductions made u/s 80P(2)(d) of Rs 13,67,260/- stating that the interest received from. Saraswat Co-operative Bank Ltd, Cosmos Co-op Bank Ltd and Mumbai District Central Co-operative Bank are not co-operative societies in spite of confirmation letters obtained from respective banks. B) The Learned CIT Appeal has stated as under: \"Can a law of State or Centre allow the registration of co-operative society, if last words of its name are \"Co-operative society Private Limited\"?\" The Learned CIT Appeals erred and failed to notice that all cooperative societies are required to end their name with Limited or Unlimited as per section 6(5) of Maharashtra State Co-operative Society Act 1960. C) The Learned CIT Appeal erred and failed to notice that Section 8 of Companies Act has no application to the facts of the case. D) The Learned CIT Appeal erred and failed to notice that section 56(f) of the Banking Regulation Act of 1949, that any violation of the said Banking regulation Act of 1949 by the Bank, would not effect the claim of the assessee a co-operative society under section 80P(2)(d). E) The Learned CIT Appeals erred in incorrectly applying the caselaw'in the case of Uppinangady Catholic Multipurpose Co-operative Society Ltd. Vs ITO dated 07.06.2023 without providing the copy to the assessee nor considering the fact that the said co-operative society were involved in providing credit facilities to its members. F) The Learned CIT Appeals erred in not considering the direct judgments of High Court of Gujarat and the Jurisdictional ITAT Mumbai in violation of the Legal principals laid down by the Hon'ble Bombay High court in the case of CIT Vs. Godavari Saraf 113 ITR 589 (Bombay) and is therefore in contempt of the High Court. 6. Without prejudice to the above grounds of appeal, the assessee pleads for reimbursement of cost of Rs 10,000 in addition to legal fees for forcing the assessee to file an appeal by ignoring CBDT circulars and laid down legal principals of grounds of natural justice.” P a g e | 3 ITA No. 2770/Mum/2025 A.Y. 2021-22 Shah Nivas Co. Op. HSG. Society Ltd. 3. The only issue raised in the present appeal is with regard to the non- granting of deduction u/s 80P(2)(d) of the Act of Rs. 13,67,260/- on account of interest received from Saraswat Cooperative Bank, Cosmo Cooperative Bank and Mumbai District Central Cooperative Bank by holding that these are not cooperative societies. 4. After having heard both the parties, I find that this issue is covered by the decisions of the coordinate benches of ITAT and also by the decision of the Hon’ble Gujarat High Court in the case of PCIT v/s Ashwin Kumar Urban Cooperative Society Ltd. 2024 (11) TMI 974 (Guj. HC), wherein it has been held that the deduction u/s 80P(2)(d) of the Act is available to the cooperative society on the income earned as interest on the investment made with the cooperative banks, which in term are cooperative society itself. This issue has further been decided by the decisions of the coordinate benches in the following cases: i. New Ideal CHSL vs. ITO Ward 19(2)(4) in ITA No. 2681/Mum/2019 ii. Petit Towers CHSL vs. ITO 19(2)(5) in ITA No. 549/Mum/2021 iii. Jal Ratan Deep CHSL vs. ITO 13(1)(1) in ITA Nos. 2347/Mum/2022 & others iv. Yudhishtir CHSL vs. JAO, Ward 42(1)(4) in ITA No. 1784/Mum/2025 v. ITO-17(2)(1) vs. Mittal Court Premises CHSL in ITA Nos. 1535 to 1537/Mum/2022 vi. Palm Court M Premises CHSL vs. PCIT-30 ITA No. 561/Mum/2021 vii. Jaimuni Sahkari Pathpedi Maryadit vs. AU, ITD ITA Nos. 332/Mum/2025 & others viii. Uppinangady Catholoc Multipurpose CHSL vs. ITO Ward ITA No. 292/Bang/2023 5. Therefore, taking into consideration the decisions of the coordinate benches and also of the Hon’ble Gujarat High Court, we allow the ground raised P a g e | 4 ITA No. 2770/Mum/2025 A.Y. 2021-22 Shah Nivas Co. Op. HSG. Society Ltd. by the assessee and direct the AO to allow the deduction u/s 80P(2)(d) of the Act to the assessee on account of interest received from the banks mentioned above. 6. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 24.06.2025. Sd/- Sd/- SANDEEP GOSAIN (न्यानयक सदस्य/JUDICIAL MEMBER) Place: म ुंबई/Mumbai दिन ुंक /Date 24.06.2025 अननक ेत स ुंह र जपूत/ स्टेनो आदेश की प्रनतनलनि अग्रेनित/Copy of the Order forwarded to : 1. अपीलार्थी / The Appellant 2. प्रत्यर्थी / The Respondent. 3. आयकर आयुक्त / CIT 4. विभागीय प्रविविवि, आयकर अपीलीय अविकरण DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. सत्यानित प्रनत //True Copy// आदेशािुसार/ BY ORDER, सहायक िंजीकार (Asstt. Registrar) आयकर अिीलीय अनर्करण/ ITAT, Bench, Mumbai. "