Income Tax Appellate Tribunal - Pune
Tirupati Campus Ph.Ii Co-Op Society ... vs Income-Tax Officer, Ward - 7(4),, Pune on 28 February, 2019
आयकर अपील य अ धकरण] पण
ु े यायपीठ "एक सद य" पण
ु े म
IN THE INCOME TAX APPELLATE TRIBUNAL
PUNE BENCH "SMC", PUNE
BEFORE
SHRI ANIL CHATURVEDI, AM
आयकर अपील सं
. / ITA No.1429/PUN/2018
नधा रण वष / Assessment Year : 2015-16
Tirupati Campus Ph.II Co-op Housing .......... अपीलाथ /
Society Maryadit, Tirupati Campus
Appellant
Phase II, Adarsha Colony, Road No.2,
Vishrantwadi, Pune - 411015.
PAN : AACAT3001H.
बनाम v/s
The Income Tax Officer, .......... यथ /
Ward - 7(4), Pune.
Respondent
Assessee by : Shri Manoj Deshpande.
Revenue by : Shri Rajesh Gawali.
सन
ु वाई क तार ख / घोषणा क तार ख /
Date of Hearing : 30.01.2019 Date of Pronouncement: 28.02.2019
आदे श / ORDER
PER ANIL CHATURVEDI, AM :
1. This appeal filed by the assessee is emanating out of the order of Commissioner of Income Tax (A) - Pune-5, Pune dated 24.05.2018 for the assessment year 2015-16.
2. The relevant facts as culled out from the material on record are as under :-
Assessee is a Co-operative Society, who electronically filed its return of income for A.Y. 2015-16 on 28.08.2015 declaring total income of Rs.16,85,525/-. The case was selected for scrutiny and 2 ITA No.1429/PUN/2018 thereafter, assessment was framed u/s 143(3) of the Act vide order dt.30.06.2017 and the total income was determined at Rs.16,35,530/-. Aggrieved by the order of AO, assessee carried the matter before Ld.CIT(A), who vide order dt.24.05.2018 (in appeal No.PN/CIT(A)-5/ITO, Wd-7(4), Pune/10309/2017-18) dismissed the appeal of assessee. Aggrieved by the order of Ld.CIT(A), assessee is now in appeal and has raised the following grounds :
"1. The ld. CIT(A) erred in confirming the disallowance of the available deduction under section 80P(2)(d) of the Act, in respect of interest income aggregating to Rs.16,85,525/- earned by the appellant on the deposits placed with Co-operative Banks; by holding that Co-operative banks are not co-operative society as contemplated by Section 80P(2)(d).
2. The CIT(A) also failed to appreciate the fact that the Co-operative banks from the Appellant has received interest are governed by Multi State Cooperative Societies Act 2002 and also is governed by the provisions of the Banking Regulation Act as applicable to the Cooperative Societies as it is a cooperative society carrying on banking business.
3. The Ld. CIT(A) has not allowed the claim for proportionate expenses to be set off against the taxable (interest received) and exempted income (maintenance charges collected from members exempted under mutuality concept)."
3. During the course of assessment proceedings, on perusing the Profit and Loss account, AO noticed that assessee had earned interest income of Rs.16,85,525/- on the deposits held with Saraswat Co-operative Bank, TJSB Bank, Cosmos Banks and IDBI Bank, which was claimed as deduction u/s 80P(2)(d) of the Act. AO was of the view that the interest income earned by the assessee from Co-operative Bank and other Nationalized and Private Banks is not eligible for deduction u/s 80P of the Act. He accordingly denied the claim of deduction. Aggrieved by the order of AO, 3 ITA No.1429/PUN/2018 assessee carried the matter before Ld.CIT(A), who upheld the order of AO by observing as under :
"5.5 I have perused carefully the material on record and the contention of the appellant. The appellant has contended that the Assessing Officer made the addition by placing reliance on the decision of Hon'ble ITAT, Mumbai in the case of Bandra Shiv Samrudhi CHS Ltd which was overruled by the Hon'ble ITAT Mumbai in the case of Lands End Co-operative Housing Society Vs. ITO Ward 16(1)(3), Mumbai vide order dated 15.01.2016 (3566/M/2014), and therefore, the addition made by the Assessing Officer deserves to be deleted.
5.6 I find the Assessing Officer has made the addition as he held that, in the case under consideration, the interest income earned from the Co-operative Bank did not fall under the purview of a "Co- operative Society", as a Co-operative Society confines its activities to its Shareholders or Members where such members are bound together by belonging to the same employer or same specific business activity or residing in the same complex or society. The Assessing Officer has not made the addition only on the basis of the decision of Hon'ble ITAT, Mumbai in the case of Bandra Shiv Samrudhi CHS Ltd. (supra) but has used it to buttress his stand. The Assessing Officer has clearly arrived at the conclusion that, the interest earned from the Co-operative bank did not fall under the purview of "Co-operative Society" for the reasons mentioned in the assessment order and as stated above. The interest is earned not only from Co-operative banks but also from other Nationalized and private banks. Therefore, the case under consideration is also distinguishable from both the decisions of Hon'ble ITAT Mumbai (supra) relied upon by the appellant. In both the cases the interest earned is from other Co-operative Societies. In view of this, the contention of the Appellant lacks strength and is therefore, dismissed. Accordingly, Ground No.1 is dismissed."
Aggrieved by the order of Ld.CIT(A), assessee is now in appeal.
4. Before me, Ld.A.R. at the outset, submitted that the issue in the present case is with respect to denial of claim of deduction u/s 80P(2)(d) of the Act. Ld.A.R. submitted that the claim of deduction was denied by the AO for the reason that Saraswat Co-operative Bank is not a Co-operative Society. He submitted that on identical facts in the case of M/s. The Veer Cooperative Group 4 ITA No.1429/PUN/2018 Housing Society Ltd., Vs. ITO, the Delhi Bench of the Tribunal has held that Saraswat Co-operative Bank to be a Co-operative Society and therefore income earned from its investment to be claimed as deduction u/s 80P of the Act. He pointed to the relevant paras of the said order and also placed in record the copy of the said order. With respect to interest earned from other banks, he relied on the decision of Mumbai Bench of the Tribunal in the case of Lady Ratan Tower Cooperative Housing Society Limited Vs. ITO in ITA No.1152/Mum/2018 dated 09.08.2018 wherein following the order in the case of Kaliandas Udyog Bhavan Premises Co-operative Society Ltd., (in ITA No.6547/Mum/2017 dated 25.04.2018), the issue was decided in assessee's favour. He therefore submitted that the issue in the present case being identical to the cases relied upon by him, the issue be decided in assessee's favour. Ld.D.R. on the other hand, supported the order of lower authorities.
5. I have heard the rival submissions and perused the material on record. The issue in the present ground is with respect to denial of claim of deduction u/s 80P(2)(d) of the Act. The claim of deduction by the assessee was denied by the AO with respect to the interest income earned from Saraswat Co-operative Bank on the ground that the same is not a Co-operative Society. I find that the Co-ordinate Bench of the Delhi Tribunal in the case of M/s. The Veer Cooperative Group Housing Society Limited (supra) has held that Sarswat Co-operative Bank to be a Co-operative Society and the interest earned therein to be entitled to claim deduction 5 ITA No.1429/PUN/2018 u/s 80P(2)(d) of the Act. I further find that Co-ordinate Bench of the Mumbai Tribunal in the case of Lady Ratan Tower Co- operative Housing Society Ltd., (supra) and after relying on the decision in the case of Kaliandas Udyog Bhavan Premises Co- operative Society Ltd., (supra) has held that the interest earned on investments held with the Co-operative Banks would be eligible for deduction u/s 80P(2)(d) of the Act. Before me, Revenue has not pointed out any contrary binding decision nor has placed on record any material to demonstrate that the aforesaid decisions have been set aside/ stayed/over-ruled by any higher Judicial Forum. In view of the aforesaid facts, I, following the aforesaid decisions, hold interest income of Rs.16,85,525/- earned by the assessee on the deposits held with Banks would be eligible for deduction u/s 80P(2)(d) of the Act. I therefore direct so. Thus, the ground of the assessee is allowed.
6. In the result, the appeal of the assessee is allowed.
Order pronounced on the 28th day of February, 2019.
S Sd/-
(ANIL CHATURVEDI)
लेखा सद य / ACCOUNTANT MEMBER
पुणे Pune; दनांक Dated : 28th February, 2019. Yamini 6 ITA No.1429/PUN/2018 आदे श क# $ त&ल'प अ(े'षत/Copy of the Order forwarded to :
1. अपीलाथ / The Appellant
2. यथ / The Respondent
3. CIT(A)-Pune-5, Pune.
4. Pr. CIT, Pune-4, Pune.
5 "वभागीय %त%न&ध, आयकर अपील य अ&धकरण, "एक सद+य" / DR, ITAT, "SMC" Pune;
6. गाड. फाईल / Guard file.
आदे शानस ु ार/ BY ORDER // True Copy // व0र1ठ %नजी स&चव / Sr. Private Secretary आयकर अपील य अ&धकरण ,पण ु े / ITAT, Pune.