ITA 2884/BANG/2025

Parties Involved

Facts Summary

The assessee, a Co-operative Credit Society registered under the Karnataka Co-operative Societies Act, 1959, filed an appeal against the order passed by the Commissioner of Income Tax (Appeals) for the assessment year 2016-17. The assessee claimed that the interest income earned from investments in Co-operative Banks and statutory deposits should be eligible for deduction under section 80P(2)(a)(i) of the Income Tax Act, 1961. The Assessing Officer and the Commissioner of Income Tax (Appeals) disagreed, treating the interest income as income from other sources. The assessee argued that the interest income was directly attributable to its business activity of providing credit facilities to its members.…

Legal Issues

• 1. Whether the interest income earned by the assessee from investments in Co-operative Banks and statutory deposits is eligible for deduction under section 80P(2)(a)(i) of the Act.
• 2. Whether the disallowance of deduction claimed under section 80P(2)(a)(i) of the Act is justified.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

Similar Judgements

• SIRWAR PATTINA SAHAKARA SANGHA NIYAMITA Vs. INCOME TAX OFFICER

  Bangalore bench

• Shri. Laxmi Venkatesh Credit Co-op Society Limited vs. Income Tax Officer

  Bangalore bench

• ITA 2245 and 2246/BANG/2026

  Bangalore bench

• Belve Vyavasaya Seva Sahakari Sangha Ltd Udupi

  C''Bench: Bangalore benchAY 2020-21Partly Allowed

• Kottayam Service Co-operative Bank Limited v. The Income Tax Officer

  Cochin bench

• Jagannath Co-operative Credit Society vs ITO, Ward -41(1)(2)

  Mumbai benchAY 2016-17Allowed