SHRI BALAJI KHAJGI TEACHER CO OP CREDIT SOCIETY LIMITED,JALNA V. ITO WARD 1 JALNA, JALNA

ITA 287/PUN/2025

AI Insights

The case involves Shri Balaji Khajgi Teacher Co-operative Credit Society Limited, which appealed against the order of the CIT Appeal confirming the disallowance of deduction under section 80P(2) amounting to Rs 6,83,700 for interest received from banks on Fixed Deposits for the Assessment Year 2018-19. The primary contention was whether the interest income from deposits with Co-operative Banks and Nationalized Banks qualifies for deduction under section 80P(2)(a)(i) of the Income-tax Act. The Tribunal referenced previous decisions favoring the assessee's position regarding Co-operative Banks and sought further clarification on the necessity and compliance of maintaining deposits with Nationalized Banks.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 36207 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-03-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2018-2019
• Other Referred Cases: Ugar Sugar works Kamgar and Dr. Shirgaokar Shaikshanik Trust Nokar Co-operative Credit Society/ITA 84/PUN/2018
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: AVIYOGI AMBADKAR
• Assessee Lawyers: GIRISH LADDA; VARIOUS DECISIONS OF THIS
• Keywords: Co-operative Credit Society
• Section: 250; 80P; 20

Judgement Text

"आयकर अपीलीय अधिकरण \"एस एम सी\" न्यायपीठ पुणे में । IN THE INCOME TAX APPELLATE TRIBUNAL \"SMC\" BENCH, PUNE BEFORE Dr. MANISH BORAD, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.287/PUN/2025 धििाारण वषा / Assessment Year: 2018-2019 Shri Balaji Khajgi Teacher Co-operative Credit Society Limited, Behind Panchayat Samiti, Bhokardan, Dist-Jalna-431114 Maharashtra PAN-AABAS9758D Vs ITO, Ward-1, Jalna Appellant Respondent Assessee by : Shri Girish Ladda Revenue by : Shri Aviyogi Ambadkar, Additional CIT Date of hearing : 13.03.2025 Date of pronouncement : 25.03.2025 आदेश/ORDER PER DR. MANISH BORAD, ACCOUNTANT MEMBER : This appeal at the instance of the assessee is directed against the order of Ld. CIT Appeal (NFAC) u/s 250 of the Income-tax Act, 1961 dated 30.09.2024 for the A.Y. 2018-19 which is arising out of Order passed u/s.143(3) of the Act dated 23.02.2021. 2. Assessee has raised following grounds of appeal:- 1) On the facts of the case and in law, the CIT(A) has erred in confirming the disallowance of deduction u/s 80P (2) Rs 6,83,700 in respect of interest received from banks on Fixed Deposits. The addition may please be deleted as the issue is covered in favor of the assessee by various judgements of Hon PUNE ITAT. 2) The Id. AO and CIT(A) erred in not the following the binding decisions of Jurisdictional PUNE ITAT holding that cooperative societies are eligible for deduction u/s 80P(2)(a)(i) in respect of interest received from all banks including nationalized or scheduled banks. Hence, it is prayed that addition of Rs 6,83,700 may please be deleted. 3) The Appellant prays for just and equitable relief. 4) The Appellant seeks leave to add, alter, amend or drop any of the grounds taken above. 2 ITA No.287/PUN/2025 3. Sole grievance of the assessee is that it is eligible for deduction u/s 80P(2) of the Act at Rs. 6,83,700/- in respect of interest received from Bank on fixed deposits. Reference was also made to the Paper Book containing 20 pages and also including decision of this Tribunal in ITA 1148/PUN/2018, dated 04.11.2022. On the other hand Ld. DR supported the order of both the lower authorities. 4. I have heard rival contentions and perused the record placed before us. The assessee is a co-operative credit society and the return of income filed for the A.Y. 2018-2019 on 15.10.2018 declaring income of Rs. 1,52,130/- was selected for scrutiny and the deduction claim u/s 80P was restricted to the extent of Rs. 6,83,700/- on account of the interest of Rs. 4,00,753/- earned from deposits with SBI Branch Bhokardan and interest of Rs. 2,82,947/- received from the Jalna Trust Co- operative Bank. 5.(a) So far as the interest income earned from deposits from Co-operative Banks we find that the issue stands squarely covered in favour of the assessee by various decisions of this Tribunal. We would like to refer to the decision of this Tribunal in case of the Ugar Sugar works Kamgar and Dr. Shirgaokar Shaikshanik Trust Nokar Co-operative Credit Society/ITA 84/PUN/2018, dated 27.05.2022 where it has been held that since co-operative Banks are basically co-operative societies, the interest earned from such co-operative banks is also eligible for deduction u/s 80P(2)(d) of the Act. Respectively following the same I hold that the assessee is to be granted deduction u/s 80P(2)(d) of the Act for interest earned from Co-operative Banks at Rs. 2,82,947/- 3 ITA No.287/PUN/2025 5.(b) So far remaining amount of deduction u/s 80P of the Act at Rs. 4,00,753/- for Interest earned from Nationalized Banks SBI it has been claimed by the assessee that the assessee has to maintain the deposits with Nationalized Banks in terms of the rules and regulations of the societies Act and also to maintain the liquidity ratio. As the necessary details placed before me were not placed before the lower authorities, I restore this issue to the file of Ld. JAO for the limited purpose of examining the claim of the assessee as discussed above and if Ld. JAO is satisfied that deposits held with SBI are for the purpose of maintaining the liquidity ratio and to follow the guidelines maintained in the society registration Act applicable to the assessee and to carry out the activity, then Ld. JAO decide in accordance with law. Accordingly grounds of assessee are partially allowed for statistical purposes as per terms indicated above. 6. In the result, appeal of the assessee is partly allowed for statistical purposes. Order pronounced on this 25th day of March, 2025. Sd/- (MANISH BORAD) ACCOUNTANT MEMBER पुणे/ Pune; दििांक / Dated: 25th March, 2025. Neeta आिेश की प्रधिधलधप अग्रेधषि / Copy of the Order forwarded to: 1. अपीलार्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The Pr. CIT concerned. 4. धवभागीय प्रधिधिधि, आयकर अपीलीय अधिकरण, \"SMC\" बेंच, पुणे / DR, ITAT, \"SMC\" Bench, Pune. 4 ITA No.287/PUN/2025 5. गार्ा फाइल / Guard File. आिेशािुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अधिकरण, पुणे / ITAT, Pune. "