THE MAHARASHTRA STATE COOPERATIVE TEXTILE FEDERATION LTD ,MUMBAI V. INCOME TAX OFFICER 17 2 3 , MUMBAI

ITA 740/MUM/2025

AI Insights

The case involves The Maharashtra State Co-operative Textile Federation Limited, which appealed against the orders of the CIT(A)/NFAC, Delhi, concerning the disallowance of deductions claimed under section 80P(2)(d) of the Income Tax Act for the assessment years 2015-16, 2017-18, 2018-19, and 2020-21. The primary issue was whether the interest income received from cooperative banks qualifies for deduction under the specified section. The Income Tax Officer had disallowed these deductions, viewing cooperative banks as not falling under the purview of cooperative societies. However, the tribunal, referencing a series of decisions including a specific case involving MTNL Mumbai Employees Cooperative Credit Society, overturned this view, allowing the appeals.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 37385 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2018-2019
• Other Referred Cases: ITO Vs MTNL Mumbai Employees Cooperative Credit Society in ITA No. 51222,6125 & 5127/Mum/2024 dated 02.12.2024
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH MESHRAM
• Assessee Lawyers: MANDAR VAIDYA
• 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 ITAs No. 738, 739, 740 & 741/MUM/2025 Assessment Years : 2015-16, 2017-18, 2018-19 & 2020-21 The Maharashtra State Co-operative Textile Federation Limited., 18 Vakils House, Shri Shivsagar, Ramgulam Road, Ballard Estate, Mumbai - 400001. PAN No. AAAAM0130E ……………. Appellant Versus ITO – 17(2)(4), 113, 1st Floor, Kautilya Bhavan, C-41 to C-43, G-Block, Bandra Kurla Complex, Bandra (East), Mumbai-400051. ……………. Respondent Assessee by : Shri Mandar Vaidya - CA/ AR Revenue by : Shri Rajesh Meshram, Sr. DR Date of Hearing – 27/03/2025 Date of Order – 27/03/2025 Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER; 1. These four appeals by the assessee are directed against the separate orders passed by the CIT(A)/ NFAC, Delhi of even date 24.12.2024 passed under section 250 of the Income Tax Act, 1961 (“the Act”) for the Assessment Years (A.Y.) 2015-16, 2017-18, 2018-19 and 2020-21. In all the captioned appeals, the assessee has raised the similar grounds of appeal relate to disallowance of deduction under section 80P(2)(d) of the Act, the facts in all four years are similar except variation of figure of disallowance under section 2 ITAs No. 738, 739, 740 & 741/Mum/2025 The Maharashtra State Co-operative Textile Federation Limited., 80P(2)(d) of the Act. The facts in A.Y. 2015-16 (ITA No.738/Mum/2025) is taken up as lead case. ITA No.738/Mum/2025 (A.Y. 2015-16) 2. Though the assessee has raised several grounds of appeal, however in our considered view, the substantial grounds of appeal relate to deduction under section 80P(2)(d) of Rs.4606594/- 3. The rival submissions of both the parties have been heard and record perused. The learned authorised representative (ld. AR) of the assessee submitted that while filing return of income, the assessee in its computation of total income claimed deduction of Rs.46,06,594/- under section 80P(2)(d) of the Act, which consist of interest of Rs. 1,18,697/- received from the Maharashtra State Cooperative Bank and Rs. 44,88,043/-, received from Saraswat Cooperative Bank. The AO disallowed such deduction by taking view that co-operative banks are not fall under the purview of co-operative society as discussed by him in para 4.12 of his order. The ld. AR of the assessee submits that in a series of decision by this bench, it has been consistently held that co-operative banks are primarily a co-operative society and the interest received from such co-operative bank are eligible for deduction under section 80P(2)(d) to support its submission. The ld. AR relied upon the decision of Mumbai Tribunal in ITO Vs MTNL Mumbai Employees Cooperative Credit Society in ITA No. 51222,6125 & 5127/Mum/2024 dated 02.12.2024 4. On the other hand, learned senior departmental representative (Sr. DR) for the Revenue supported the order of lower authorities. 3 ITAs No. 738, 739, 740 & 741/Mum/2025 The Maharashtra State Co-operative Textile Federation Limited., 5. 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 for deduction under section 80P(2)(d). similar view was taken by Mumbai bench in ITO Vs MTNL Mumbai Employees Cooperative Credit Society (supra). 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. 6. In the result, the grounds of appeal raised by the assessee for A.Y. 2015-16 in ITA No.738/Mum/2025 are allowed. 7. Considering the fact that we have already allowed the appeal for A.Y. 2015- 16, the remaining appeals for A.Ys. 2017-18, 2018-19 and 2020-21 are also allowed on similar directions. 8. To sum up, all the four appeals of the assessee are allowed. Order pronounced in the open Court on 27/03/2025 at the time of hearing. Sd/- GIRISH AGRAWAL ACCOUNTANT MEMBER Sd/- PAWAN SINGH JUDICIAL MEMBER MUMBAI, DATED: 27/03/2025 Prabhat 4 ITAs No. 738, 739, 740 & 741/Mum/2025 The Maharashtra State Co-operative Textile Federation Limited., 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 "