The Income Tax Appellate Tribunal Ahmedabad ruled that the Income Tax deduction is allowable on interest income earned from deposits with Co-operative banks.
The bench observed that the solitary issue in the appeal which has arisen for adjudication is with respect to allowability of deduction of Rs. 2,55,000/- u/s. 80P(2)(d) of the 1961 Act, with respect to interest received by the assessee from the Co-operative Bank i.e. The Sabarkantha District Central Co-operative Bank, Khedbrahma.
The tribunal further observed that the Jurisdictional HighCourt in the case of Surat Vankar Sahakari Sangh Ltd. v. ACITreportedin (2016) and State Bank of India v/s CIT has decided the issue in favor of the tax-payer by holding that interest income received by Credit Cooperative Society from deposits made with Co-operative Bank registered under the Co-operativeSocieties Act or under the State Act, shall be allowed as deduction u/s 80P(2)(d), and the ITAT in several cases had already decided the issue in favour of the tax-payer, including in the case of the assessee itself for immediately preceding assessment year i.e. 2017-18.
The bench allowed the appeal.
Case Information
Case Name: The Khedbrahma Taluka Primary Teachers Co-operative Credit Society Limited v/s The Income TaxOfficer
Judicial Level & Location : ITAT Ahmedabad
Case Number : ITA No. 115/Ahd/2023
Date of Decision : 01/08/2024
Decision in favor of: Appellant
Judges: Shri Ramit Kochar, Accountant Member & Shri T R Senthil Kumar, Judicial Member