Mahatma Gandhi Nagri Sahakari Pat ... vs Income Tax Officer- Ward 1 -Latur, Latur on 9 September, 2025
23. Thus, the aforesaid judgments supports the view taken by this
Court that character of income depends upon the nature of activity for
earning that income and though in the face of it, the same may appear
to be falling in any of the specified Clauses of Section 80P(2) of the
Act, but on a deeper analysis of the facts, it may become ineligible for
deduction under Section 80P(2) of the Act. The case in Udaipur
Sahakari Upbhokta Thok Bhandar Ltd. (supra) was that of Section
80P(2)(e) of the Act, whereas in the present case, it is under section
80P(2)(d) of the Act. Hence, the income by way of interest earned by
deposit or investment of idle or surplus funds does not change its
character irrespective of the fact whether such income of interest is
earned from a schedule bank or a cooperative bank and thus, clause