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Income Tax Appellate Tribunal - Pune

Shriniwas Sahakari Griharachana ... vs Income Tax Officer Ward 12(1), Pune on 30 April, 2026

     IN THE INCOME TAX APPELLATE TRIBUNAL
            PUNE BENCHES "SMC", PUNE

BEFORE DR.MANISH BORAD, ACCOUNTANT MEMBER

       आयकर अपील स.ं / ITA Nos.680 to 683/PUN/2026
        Assessment Years : 2016-17 to 2019-20
 Shriniwas Sahakari                 Vs. Income Tax Officer,
 Griharachana Sanstha Limited,          Ward-12(1), Pune
 471, Sadashiv Peth,
 Pantacha Got, Balasaheb Pant
 Pratinidhi Road, Pune 411030
 Maharashtra
 PAN : AAVAS7669H
             Appellant                       Respondent


     Assessee by              :   Shri Abhay Avachat
     Revenue by               :   Shri Manish Sinha
                                  (virtual)
     Date of hearing          :   30.04.2026
     Date of pronouncement    :   30.04.2026


                      आदे श / ORDER

The captioned appeals at the instance of assessee pertaining to A.Yrs. 2016-17 to 2019-20 are directed against the separate orders dated 11.12.2025, 10.12.2025 framed by Addl/JCIT(A), Kochi National Faceless Appeal Centre, Delhi arising out of respective Intimation Orders passed u/s.143(1) of the Income Tax Act, 1961 (in short 'the Act').

2. The first common issue raised for A.Yrs. 2016-17 to 2019-20 is against the denial of deduction u/s.80P(2)(d) of the Act for the interest income earned from Pune District Central Cooperative Bank (PDCC).

3. I have heard the rival contentions and perused the record placed before me. There is no dispute to the fact that assessee has received interest income of Rs.2,74,205, 2 ITA Nos.680 to 683/Pun/2026 Shriniwas Sahakari Griharachana Sanstha Limited Rs.2,87,450/- and Rs.3,08,100/- from the investments/deposits held with PDCC.

4. There is no dispute that the assessee is a registered cooperative society and is providing credit facilities to its Members and derived interest income on investments kept with Cooperative Societies/Banks. The provisions of section 80P(2)(d) of the Act, provides for deduction towards any income by way of interest or dividend derived by a co- operative society from its investment with any other co- operative society. The term Cooperative Society has been defined u/s. 2(19) of the Act, which includes a co-operative society registered under the Cooperative Societies Act, 1912 or under any other law for the time being in force in any state for the registration of co-operative societies. Perusal of the aforesaid definition would make it clear that cooperative Society means a cooperative society registered under Cooperative Societies Act, 1912 as defined under the Act, be it a co-operative society carrying on banking business or cooperative society carrying on the other business or a cooperative bank. Interest/dividend income earned from a cooperative society from its investment with other cooperative societies, whether such society is cooperative bank or not is to be considered for allowing deduction u/s.80P(2)(d) of the Act.

5. This issue is no longer res integra by virtue of catena of decisions passed by this Tribunal on this very issue and the assessee's case is squarely covered in its favour. In the case of Thorapadi Urban Co- op Credit Society Ltd & Others vs ITO in W.P. Nos. 11172 and others, judgment dated 10.10.2023 3 ITA Nos.680 to 683/Pun/2026 Shriniwas Sahakari Griharachana Sanstha Limited which the assessee relied upon, the Hon'ble High Court of Madras following the decision of Division Bench of Hon'ble High Court of Madras in the case of CIT vs The Salem Agricultural Producers Co-operative Marketing Society Ltd in Tax Case Appeal No. 5 of 2015 held that a cooperative society is entitled to avail the benefit u/s.80P(2)(d) of the Act. In light of the above, interest income of earned from investments held with Pune District Central Cooperative Bank deserves to be allowed u/s.80P(2)(d) of the Act. I therefore set aside the impugned orders passed by the ld.CIT(A) and direct the Assessing Officer to allow the alleged deduction claimed by the assessee u/s.80P(2)(d) of the Act. The common issue raised in all the three appeals for A.Y. 2016-17, 2017-18, and A.Y. 2019-20 is allowed.

6. Second common issue relates to denial of exemption for the surplus earned from Members at Rs.1,00,185/-, Rs.39,507/-, Rs.1,88,465 and Rs.46,199/- respectively for A.Yrs. 2016-17 to 2019-20.

7. I have heard the rival contentions and perused the record placed before me. I observe that the surplus funds received from and payments made on behalf of the Members is not taxable as per Mutuality Concept. However, in the return of income, the assessee has wrongly claimed the deduction for the said amount u/s.80P of the Act which is not in accordance with law. Even the ld.CIT(A) has also not dealt with the Mutuality Concept and has only observed that assessee ought to have revised the return. However, considering the fact that such sum which is surplus on account of Mutuality Concept, i.e. funds received and funds 4 ITA Nos.680 to 683/Pun/2026 Shriniwas Sahakari Griharachana Sanstha Limited spent on behalf of the Members is not liable to tax as has been claimed by the assessee, I deem it appropriate to restore this common issue for the impugned four assessment years to the file of ld. Jurisdictional Assessing Officer. Needless to mention that in the set aside proceedings ld. JAO shall provide reasonable opportunity of hearing. This common issue raised by the assessee for the assessment years under appeal is allowed for statistical purposes.

8. In the result, ITA No. 680/PUN/2026, ITA No.681/PUN/2026 and ITA No.683/PUN/2026 are partly allowed for statistical purposes whereas ITA No.682/PUN/2026 is allowed for statistical purposes.

Order pronounced on this 30th day of April, 2026.

Sd/-

(MANISH BORAD) ACCOUNTANT MEMBER पुणे / Pune; दिन ांक / Dated : 30th April, 2026. Satish Satish Kumar Madishetty Digitally signed by Satish Kumar Madishetty Date: 2026.04.30 17:30:03 +05'30' 5 ITA Nos.680 to 683/Pun/2026 Shriniwas Sahakari Griharachana Sanstha Limited आदे श की प्रतिलिपि अग्रेपिि / Copy of the Order forwarded to :

1. अपील र्थी / The Appellant.
2. प्रत्यर्थी / The Respondent.
3. The Pr. CIT concerned.
4. विभ गीय प्रतितनधि, आयकर अपीलीय अधिकरण, "SMC" बेंच, पुणे / DR, ITAT, "SMC" Bench, Pune.
5. ग र्ड फ़ इल / Guard File.

आिे श नुस र / BY ORDER, // True Copy // Assistant Registrar, आयकर अपीलीय अधिकरण, पण ु े / ITAT, Pune.