THE MAHILA VIKAS CO OP THRIFT AND CREDIT SOCIETY LTD,SURAT V. ACIT CIRCLE 3(3), SURAT

ITA 984/SRT/2024

AI Insights

The case involves The Mahila Vikas Co-operative Thrift and Credit Society Limited appealing against the decision of the National Faceless Appeal Centre/Commissioner of Income Tax (Appeals), which disallowed a deduction of Rs. 97,066 under section 80P(2)(d) of the Income Tax Act, 1961. The deduction was related to interest and dividend income earned from Surat District Co-Operative Bank. The Tribunal's decision was influenced by precedents from the jurisdictional High Court and previous decisions of the Tribunal, which affirmed that cooperative banks are considered cooperative societies and thus eligible for such deductions.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 472217 (ITAT-SURAT)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-12-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Other Referred Cases: Ashwin Kumar Arban Co Operative Society Limited in Tax Appeal No. 538 of 2024, 221 of 2022 and 419 of 2023, Surat Vankar Sahakari Sangh Ltd. vs. ACIT (2016) 72 taxmann.com169 (Guj), Totagars Co-operative Sale Society, Vishal Co-operative Housing Services Society Limited vs. ITO, in ITA No.886/SRT/2023, dated 22.02.2024 (Surat \\u2013 Trib.), Althan Bhatar Co-operative Credit Society Ltd. Vs ACIT in ITA No. 143/Srt/2024
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MUKESH JAIN
• Assessee Lawyers: AKASH BAKASHWALA
• Keywords: Co-operative Credit Society
• Section: 143(3); 72

Judgement Text

" आयकर अपीलीय अिधकरण, सूरत Ɋायपीठ, सूरत IN THE INCOME TAX APPELLATE TRIBUNAL, SMC BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND SHRI BIJAYANANDA PRUSETH, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.984/SRT/2024 (AY. 2017-18) (physical hearing) The Mahila Vikas Co-operative Thrift and Credit Society Limited 101-102, 1st Floor, Saurabh Complex, Hans Society, Baroda Pristage, Varachha Road, Surat -395006 [PAN : AAAAT 3370 P] बनाम Vs ACIT Circle 3(3), Aayakar Bhawan, Majura Gate, Surat-395001 अपीलाथŎ/Appellant ŮȑथŎ /Respondent िनधाŊįरती की ओर से /Assessee by Shri Akash Bakashwala CA राजˢ की ओर से /Revenue by Shri Mukesh Jain – Sr-DR अपील पंजीकरण/Appeal instituted on 23.09.2024 सुनवाई की तारीख/Date of hearing 26.12.2024 उद ्घोषणा की तारीख/Date of pronouncement 26.12.2024 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 National Faceless Appeal Centre, Delhi/Commissioner of Income tax (Appeals) [for short to as “NFAC/Ld.CIT(A)] both dated 25/07/2024 for assessment years (AY) 2017-18, which in turn arose out of separate assessment orders passed by Assessing Officer under section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) 29.11.2019. Sole ground of appeal raised by the assessee relates to the deduction under section 80P(2)(d) of Rs. 97,066/-. 2. Rival submission of both the parties have been heard and record perused. The Ld. Authorized Representative (Ld.AR) for the assessee submits that “grounds The Mahila Vikas Co-operative Thrift and Credit Society Limited ITA No. 984/Srt/2024(AY 2017-18) 2 of appeal” raised by assessee is covered by the decision of Hon’ble jurisdictional High Court in Ashwin Kumar Arban Co Operative Society Limited in Tax Appeal No. 538 of 2024, 221 of 2022 and 419 of 2023, as well as by series of decisions of this Tribunal, wherein it has been consistently held that co-operative societies are eligible for deduction of interest and dividend earned from other co-operative society and co-operative banks. It is also held in a series of such decisions that co-operative banks are primarily co-operative societies. During the year under consideration, assessee has earned interest and dividend income from Surat District Co-Operative Bank of Rs. 51,977/- as interest on savings deposits, Rs. 41,324/- as interest from fixed deposits and dividend income of Rs.3765/-from Surat District Co-Operative Bank. Thus, aggregating to Rs. 97,066/-. The Ld. AR of the assessee submits that such figures are recorded in para-4 of assessment order, otherwise such details are available on page No. 21 of paper book. The Ld. AR of the assessee submits that lower authorities disallowed such deduction on the ground that cooperative bank cannot be considered as cooperative society. However, Hon’ble jurisdictional High Court in the case of Surat Vankar Sahakari Sangh Ltd. vs. ACIT (2016) 72 taxmann.com169 (Guj) holding that that co-operative is eligible for deduction under section 80P(2)(d) of the Act in respect of gross interest received from co-operative bank without adjusting interest paid to said bank. The Ld. AR of the assessee submits that he has already placed on record copy of computation of total income with its bifurcation of all components of income including the figure of interest income earned from Surat District Co- operative bank and dividend income. The Mahila Vikas Co-operative Thrift and Credit Society Limited ITA No. 984/Srt/2024(AY 2017-18) 3 3. On the other hand, Ld. Senior Departmental Representative (Ld. Sr-DR) for the Revenue relied upon the orders of lower authorities submits that as the interest earned from assessee’s business operation and from its activities thus, not eligible for deduction under section 80P(2)(d) of the Act. 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-4 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 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 Mahila Vikas Co-operative Thrift and Credit Society Limited ITA No. 984/Srt/2024(AY 2017-18) 4 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 decision, which is followed in a series of decisions by this Bench and respectfully following the said decisions, we direct the Assessing Officer to allow deduction of Rs. 97,066/- on account of interest and dividend earned from Surat District Co-Operative Bank as claimed under section 80P(2)(d) of the Act. In the result, the grounds of appeal raised by the assessee is allowed. 7. In the result, appeal of assessee is allowed. Order pronounced in the open court on 26/12/2024. Sd/- Sd/- (BIJAYANANDA PRUSETH) (PAWAN SINGH) लेखा सद˟/Accountant Member Ɋाियक सद˟/Judicial Member सूरत / Surat Dated: 26/12/2024 Self * 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 By order/आदेश से, // True Copy // सहायक पंजीकार आयकर अपीलीय अिधकरण, सूरत "