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

Parties Involved

Facts Summary

The case involves three appeals by Kottayam Service Co-operative Bank Limited against the disallowance of section 80P(2)(a)(i) deduction claim for interest income from deposits made in co-operative Banks. The assessee argues that the interest income is eligible for tax deduction. The respondent argues that the interest income is not derived from the assessee’s regular credit facilities and cites a High Court decision to support their stand. The Tribunal adopts the High Court’s reasoning and holds that the interest income does not fall under Section 80P(2)(a)(i) and is limited to Co-operative Societies/Banks registered under Kerala Co-operative Societies Act.…

Legal Issues

• 1. Whether the interest income from deposits made in co-operative Banks is eligible for tax deduction under section 80P(2)(a)(i).

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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