Interest / Dividend Income from Investment with Cooperative Society is Entitled to Deduction u/s 80 P (2)(d) of Income Tax Act : ITAT remits to AO for Fresh Consideration

The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) ruled that interest and dividend income from investments with a cooperative society qualify for deduction under Section 80P(2)(d) of the Income Tax Act, 1961. The case involving Tumkur City Credit Souharda Cooperative Society Limited was remitted to the Assessing Officer (AO) for fresh consideration. \r

The tribunal noted previous denials under Section 80P(2)(a)(i) due to perceived violations of mutuality principles among members. Citing precedent from Mavilayi Service Co-operative Bank Ltd. & Ors. v. CIT & Anr., the tribunal emphasized the eligibility of cooperative societies for deductions. \r

The bench, including Keshav Dubey and Chandra Poojari, directed the AO to reconsider the matter, allowing relief under Section 57 if the income is categorized as "Income from other sources." The appeal by the assessee was partly allowed.