SISODARA VIBHAG VIVIDH KARYAKARI SAHAKARI MANDLI LTD.,NAVSARI V. ITO, WARD-5, NAVSARI

ITA 1256/SRT/2024

AI Insights

The case involves Sisodara Vibhag Vividh Karyakari Sahakari Mandli Ltd., the appellant, contesting the additions made to their income by the Income Tax Officer, Ward-5, Navsari, the respondent. The additions pertained to interest and dividend income received from Valsad District Central Co-Op. Bank Ltd., which the appellant argued were eligible for deduction under section 80P(2)(d) of the Income Tax Act, 1961. The Tribunal considered previous decisions and the specific provisions of the Act, ultimately deciding in favor of the appellant by allowing the deductions claimed.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 106848 (ITAT-SURAT)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Other Referred Cases: Gujarat State Co-Op. Fruits & Vegetable Marketing Federation Ltd. vs. ITO, Althan Bhatar Co-Operative Credit Society Ltd. vs. ACIT, Uttar Gujarat Uma Co-op Credit Society Ltd, Bardoli Vibhag Gram Vikas Co-operative Credit Society Ltd, Surat Vankar Sahakari Sangh Ltd. vs. ACIT, Vishal Co-operative Housing Services Society Limited vs. ITO, PCIT vs. Totagars Co-operative Sale Society
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MUKESH JAIN
• Assessee Lawyers: SUJESH C. SURATWALA
• Keywords: Co-operative Credit Society
• Section: 143(3)

Judgement Text

"आयकर अपीलीय अिधकरण, सुरत Ɋायपीठ, सुरत IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND SHRI BIJAYANANDA PRUSETH, ACCOUNTANT MEMBER आ.अ.सं./ITA No.1256/SRT/2024 (AY 2013-14) (Hybrid Hearing) Sisodara Vibhag Vividh Karyakari Sahakari Mandli Ltd. AT & PO Ganesh Sisodara Dist., Navsari-396445 [PAN No. AAAAS 6841 C] Vs Income Tax Officer, Ward-5, Navsari, Near Char Pool Police Gate, Navsari-396445 अपीलाथŎ/Appellant ŮȑथŎ /Respondent िनधाŊįरती की ओर से /Assessee by Shri Sujesh C. Suratwala, CA राजˢ की ओर से /Revenue by Shri Mukesh Jain, Sr-DR सुनवाई की तारीख/Date of hearing 20.02.2025 उद ्घोषणा की तारीख/Date of pronouncement 20.02.2025 Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by assessee is directed against the order of Commissioner of Income-tax (Appeals)/Addl/JCIT(A)-4, Chennai [for short, “Ld. CIT(A)”] dated 25.11.2024 for the assessment year 2013-14 which in turn arises out assessment order passed by Assessing Office under section 143(3) r.w.s.1 47 of Income Tax Act, 1961 (‘the Act’) on 19.12.2018. The assessee has raised the following grounds of appeal: “1. In Finance Act 2006, the insertion of Section 80P(2)(4) to the Act as explained by the then Honorable Finance Minister in her budget speech is to withdrawal of exemption given to the co-op. Bank and not to levy the tax on interest and dividend earned by the primary co-op. credit society. Hence learned AO as well as CIT(A)/NFAC interpreted the law completely against the purpose of insertion of section 80P(4) which is unjustified to the assessee and required to be deleted. 2. On facts and circumstances of the case as also law on subject, the learned AO as well as CIT(A)/NFAC has erred in making addition of income of Rs.9,49,939/- which was eligible for deduction u./s ITA No.1256/SRT/2024 (A.Y 13-14) Sisodara Vibhag Vividh Karyakari Sahakari Mandli Ltd. 2 80P(2)(d) of the act, which is unjustified, bad in law. Hence, requires to be deleted. 3.On facts and circumstances of the case as also law on subject, the learned AO as well as CIT(A)/NFAC has erred in making addition of income of Rs.1,29,864/- received toward dividend from Valsad District Central Co-op Bank Ltd., which was eligible for deduction u/s 80P(2)(d) of the Act, which is unjustified, bad in law. Hence, requires to be deleted. 4. On facts and circumstances of the case as also law on subject, the learned AO as well as CIT(A)/NFAC has erred in making addition of income of Rs.8,20,075/- received towards interest from Valsad District Central Co-op Bank Ltd., which was eligible for deduction u/s 80P(2)(d) of the Act, which is unjustified, bad in law. Hence, required to be deleted. 5. On facts and circumstances of the case as also law on the subject, the learned AO as well as CIT(A)/NFAC has made an the addition made on the basis of various judgment made by Apex Court but the CIT(A)/NFAC has grossly ignored the judgment given by Honorable ITAT Ahmedabad and Honorable ITAT Surat in the case of Uttar Gujarat Uma Co-op Credit Society Ltd and Bardoli Vibhag Gram Vikas Co-operative Credit Society Ltd respectively hence making addition of interest and dividend earned from co-op. Bank is void ab initio required to be deleted. 6. The appellant craves leave to add, alter deletes, amend or rescind any of the above grounds of appeal.” 2. At the outset of hearing, Ld. Authorized Representative (Ld.AR) for the assessee submits that grounds of appeal raised by him is covered by a series of decisions of this Bench including in case of Gujarat State Co-Op. Fruits & Vegetable Marketing Federation Ltd. vs. ITO in ITA Nos.895-896/SRT/2024 dated 17.12.2024, wherein other decision in case of Althan Bhatar Co- Operative Credit Society Ltd. vs. ACIT in ITA No.143/Srt/2024 dated 30.05.2024 was followed. The Ld. AR for the assessee submits that during the year under consideration, assessee received interest income and ITA No.1256/SRT/2024 (A.Y 13-14) Sisodara Vibhag Vividh Karyakari Sahakari Mandli Ltd. 3 dividend from other Co-operative Bank i.e., Valsad District Central Co-Op. Bank Ltd., the Valsad District Central Co-Op. Bank Ltd. is a primary Co- operative society. The Ld. AR of the assessee submits that no relief is claimed in the present appeal of assessee. 3. On the other hand, Ld. Senior-Departmental-Representative (Ld. Sr-DR) for the Revenue supported the order of lower authorities. 4. We have considered the rival submission of both parties and have gone through the orders of the authorities below carefully. We find that appeal relates to dividend income of Rs.1,29,864/- and interest income of Rs. 8,20,075/- received from Valsad District Central Co-Op. Bank Ltd. we find that on similar grounds of appeal, combination of this Bench in the case of Gujarat State Co-Op. Fruits & Vegetable Marketing Federation Ltd. (supra) by following the earlier decision in the case of Althan Bhatar Co-Operative Credit Society Ltd. (supra) this bench on similar contention of the parties passed the following order: 4.We have considered the rival submissions of both the parties and have gone through order of lower authorities carefully. We have also deliberated the case law relied upon by both the parties. We find that Ld. AR of the assessee has made a limited prayer about deduction under section 80P(2)(d) of the Act which has been clearly recorded by Assessing Officer in page-2 of assessment order i.e., interest and the dividend earned from co-operative bank. We find that ground of appeal raised by assessee is squarely covered by a series of decisions of this co- ordinate Bench of this Tribunal even after considering the decisions of Hon’ble Karnataka High Court in the case of Totagars Co-operative Sale Society (supra) relied by Ld. Sr-DR for the Revenue. 5.We find that in Althan Bhatar Co-operative Credit Society Ltd. Vs ACIT in ITA No. 143/Srt/2024, this combination on similar contention of the parties passed the following order; 7.We have considered the rival submissions of both the parties and perused the orders of the lower authorities carefully. The dispute relates to deduction claimed under section 80P(2)(d) of the Act with ITA No.1256/SRT/2024 (A.Y 13-14) Sisodara Vibhag Vividh Karyakari Sahakari Mandli Ltd. 4 regard to interest earned on fixed deposit with Surat District Co- operative Bank. We find that issue related with the deduction under section 80(P)(2)(d) is squarely covered by the series of decisions of jurisdictional High Court in Surat Vankar Sahakari Sangh Ltd. vs. ACIT ( supra) as well as by decisions of this Tribunal in favour of assessee including in the case of Vishal Co-operative Housing Services Society Limited vs. ITO, in ITA No.886/SRT/2023, dated 22.02.2024 (Surat – Trib.), wherein it was held that Co-operative Banks are primarily the Co-operative Society and the interest earned on deposit with Co- operative banks are eligible for deduction under section 80P(2)(d) of the Act. Similar, view was taken in assesses own case for AY 2014-15 in ITA No.151/SRT/2019, dated 31.03.2022. Having gone through the order of Co-ordinate Bench (supra), we see no reason to take a different view from the view taken by the Co-ordinate Bench (supra). 6. Considering the aforesaid consisting decision, which is followed in a series of decisions by this co-ordinate Bench of this Tribunal and respectfully following the said decisions, we direct the Assessing Officer to delete the deduction under section 80P(2)(d) of the Act. So far as reliance on the decision of Hon’ble Karnataka High Court in case of PCIT vs. Totagars Co-operative Sale Society (supra) is concerned, we find that the decision of Jurisdictional High Court in Surat Vankar Sahkari Sangh (supra) has binding precedent on this bench.” 7. In the result, the grounds of appeal raised by the assessee is allowed.” 5. Considering the consistent decisions of this bench on similar issues and respectfully following the same, we direct the the Assessing Officer to delete the disallowance of deduction under section 80P(2)(d) of the Act with regard to interest income and dividend income received from Valsad District Central Co-Op. Bank Ltd. This ground of assessee’s appeal is allowed. 6. In the result, appeal of the assessee is allowed. Order pronounced in the open court on 20/02/2025 at the time of hearing of appeal. Sd/- Sd/- (BIJAYANANDA PRUSETH) (PAWAN SINGH) [लेखा सद˟/ACCOUNTANT MEMBER] [Ɋाियक सद˟ JUDICIAL MEMBER] सूरत / Surat Dated: 20/02/2025 Dkp Outsourcing Sr.P.S* ITA No.1256/SRT/2024 (A.Y 13-14) Sisodara Vibhag Vividh Karyakari Sahakari Mandli Ltd. 5 आदेश की Ůितिलिप अŤेिषत/ Copy of the order forwarded to :  अपीलाथŎ/ The Appellant  ŮȑथŎ/ The Respondent  आयकर आयुƅ/ CIT  िवभागीय Ůितिनिध, आयकर अपीलीय आिधकरण, सूरत/ DR, ITAT, SURAT  गाडŊ फाईल/ Guard File // True Copy // By order/आदेश से, सहायक पंजीकार आयकर अपीलीय अिधकरण, सूरत "