Law: Income Tax Act, 1961

Section: 80P(2)(i),256(2)

Income-tax--- ----Cooperative society---Special deduction---Cooperative society engaged in banking---Interest on Government securities and dividends on shares of Industrial Finance Corporation---Finding by Tribunal that interest income was attributable to assessee's business ---Assessee entitled to special deduction under S.80-P(2)(a)(i) in respect of such income---Indian Income Tax Act, 1961, S.80-P(2)(a)(i). The assessee was a cooperative society engaged in banking business. For the assessment years 1977-78, 1978-79 and 1979-80, the assessee claimed deduction under section 80-P(2)(a)(i) of the Income Tax Act, 1961, on the income by way of interest on Government securities and dividends on shares of the Industrial Financial Corporation. The Income-tax Officer held that the investments were made out of reserves and disallowed the claim. The Tribunal accepted the contention of the assessee that interest income was attributable to the assessee's business income. The matter was remitted to the Income-tax Officer to determine the deduction available to the assessee under section 80-P(2)(a)(i). The High Court agreed with the Tribunal. On further appeal to the Supreme Court: Held, affirming the decision, that there was no dispute that the assessee was a cooperative society carrying on the business of banking. The Tribunal had found in this case that the interest income was attributable to the business of the assessee. That finding had not been challenged on factual basis by the Revenue. No materials had been placed to upset the factual conclusion of the Tribunal. The assessee was entitled to the special deduction under section 80-P Madhya Pradesh Cooperative Bank Ltd. v. C. T. (Addl.) (1996) 218 ITR 438 (SC) distinguished. Bihar State Cooperative Bank Ltd. v. C.I.T. (1960) 39 ITR 114 (SC); Cambay Electric Supply Industrial Co. Ltd. v. C.I.T. (1978) 113 ITR 84 (SC) and Madhya Pradesh State Cooperative Bank Ltd. v. C.I.T. (Addl.) (1979) 119 ITR 327 (MP) ref. JUDGMENT M. SRINIVASAN, J.---The respondent hereinafter referred to as the "assessee" is a cooperative society engaged in banking business. For the assessment years 1977-78, 1978-79 and 1979-80, the assessee…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492