Astha Chandra ORDER
Inturi Rama Rao, Member (A)
1. This is an appeal filed by the assessee directed against the order of National Faceless Appeal Centre (NFAC), Delhi dated 12.02.2024 for the assessment year 2020-21.
2. Briefly, the facts of the case are that the appellant is a Cooperative Society registered under the Maharashtra Co-operative Societies Act, 1960. It is engaged in the business of providing credit facilities to its members and accepting deposits from them. The Return of Income for the assessment year 2020-21 was filed on 18.12.2020 declaring Nil after claiming deduction of Rs.52,68,351/- u/s.80P(2)(a)(i). Against the said return of income, the assessment was completed by the AO vide order dated 17.09.2022 passed u/s.143(3) r.w.s.144B of the Act disallowing the deduction claimed u/s.80P(2)(a)(i). While doing so, the Assessing Officer had brought to tax the interest income of Rs.52,68,351/- earned on FDs with other co-operative banks holding that the said interest does not qualify for deduction.
3. Being aggrieved, an appeal was filed before the NFAC, who vide impugned order confirmed the action of the Assessing Officer placing reliance on the decision of the Hon'ble Karnataka High Court in the case of Totgars Co.op Sale Society Ltd. Vs. ITO MANU/SC/0095/2010 : (2010) 322 ITR 283/188 Taxman 282 (SC).
4. Being aggrieved, the appellant is in appeal before this Tribunal in the present appeal.
5. When the matter was called, none appeared on behalf of the appellant despite due service of notice of hearing. Therefore, we proceed to dispose of the appeal ex parte qua the assessee.
6. On the other hand, ld. Sr. DR placing reliance on the orders of the lower authorities submits that no interference is called for.
7. We heard the ld. Sr. DR and perused the material on record. The only issue in the present appeal relates to the eligibility of the assessee for exemption u/s. 80P(2)(a)(i) or u/s 80P(2)(d) of the Act in respect of interest income earned from cooperative banks. The issue is no more res integra as the same is covered by catena of decisions passed by the Pune Benches allowing the deduction u/s.80P(2)(a)(i) of the Act.
8. The Co-ordinate Bench of the Tribunal in the case of The Ugar Sugar Works Kamgar & Dr. Shirgaokar Shaikshanik Trust Nokar Co-op Credit Society vs. ITO in ITA No.84/PAN/2018 for A.Y. 2012-13 order dated 27.05.2022 held in favour of the appellant society. The relevant paragraphs of the said order of Co-ordinate Bench of the Tribunal (supra) is reproduced herein under :-
"8. We heard the rival submissions and perused the material on record. The only issue in the present appeal is pertaining to the allowability of deduction under the provisions of section 80P(2)(d) of the Act. On perusal of provisions of section 80P(2)(d), it is clear that the income derived by a cooperative society from its investment held with other cooperative societies shall be exempt from the total income of a cooperative society. Therefore, what is relevant for claiming of deduction u/s 80P(2)(d) is that interest income should have been derived from the investment made by the assessee cooperative society with any other cooperative society. In the present case, the reasoning given by the lower authorities for denial of exemption u/s 80P(2)(d) of the Act is that interest was received from cooperative bank has no legs to stand as a cooperative bank is also a cooperative society. This issue was considered by the Hon'ble Karnataka High Court in the case of CIT vs. Totagars Cooperative Sale Society, MANU/KA/0092/2017 : 2017:KHC-D:120-DB : 392 ITR 74 (Karn) wherein the Hon'ble High Court referring to the Hon'ble Supreme Court in the case of Totgars Co-operative Sales Society Ltd. (supra) held that the ratio of decision of t........