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Section 80P of the Income-tax Act, 1961 - Deductions - Income of Co-op. societies Assessee-co-operative society which was engaged in marketing of raw silk and twisted silk was eligible for benefit of section 80P(2)(a )(i) in respect of interest received from its members for supplying materials on credit [Assessment year 1995-96] [In favour of assessee] CIT v. Tamil Nadu Co-operative Silk Producers Ltd. [2009] 311 ITR 224 (Mad.) The assessee was a co-operative society and its main object was to procure raw silk and twisted silk and market the same to its members. The assessee's claim for deduction under section 80P(2)(a)( i) was rejected by the Assessing Officer on the ground that the activity of the assessee procuring and supplying raw silk and twisted silk on credit to its members could not be considered as 'carrying on the business of banking or providing credit facilities, within the meaning of section 80P(2)(a)( i).' Held that in view of the decision in CIT v. Salem Co-operative Sugar Mills Ltd. [2006] 286 ITR 635 (Mad.), the assessee-co-operative society, which was engaged in the marketing of raw silk and twisted silk was eligible for the benefit of section 80P(2)(a)( i) in respect of the interest received from its members for supplying the material on credit. N. Muralikumaran for the Appellant. J. Balachander for the Respondent. JUDGMENT P.D. Dinakaran, J. - The above tax case is directed against the order of the Income-tax Appellate Tribunal made in I.T.A. No. 515/Mds/2000, dated April 16, 2003, with reference to the assessment year 1995-96. 2. The Revenue is the appellant. The assessee is a co-operative society and its main object is to procure raw silk and twisted silk and market the same to its members. The assessee filed its return showing nil income after claiming deduction under Chapter VI-A. While completing the assessment, the assessee's claim for deduction under section 80P(2)(a)( i) of the Income-tax Act was rejected by the Assessing Officer on the ground that the activity of the assessee procuring and supplying raw silk and twisted silk on credit to its members cannot be considered as "carrying on the business of banking or providing credit…

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