Jakraya Multi-State Co-operative Credit Society Ltd. Vs ITO

Parties Involved

Facts Summary

The assessee, a credit co-operative society, filed an appeal against the disallowance of an income tax deduction under section 80P(2) of the Income-tax Act, 1961. The society claimed a deduction for interest income earned from investments in fixed deposits with other co-operative societies and banks. The Income Tax Officer denied the deduction, leading to the appeal. The first appellate authority partially allowed the appeal, but the assessee challenged the remaining disallowance. The assessee argued that the interest income was earned in the course of its principal business of providing credit facilities to its members and thus qualified for deduction under section 80P(2)(a)(i) of the Act.…

Legal Issues

• 1. Allowability of deduction u/s 80P(2) of the Act

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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