The Assessee, a co-operative society claimed interest income earned from investments made with co-operative banks as exempt under section 80P(2)(d) of the Act. The Assessing Officer disallowed the deduction by holding that the provisions of section 80P(2)(d) extended only to co-operative society and not to co-operative banks. The Commissioner (Appeals) upheld the order of the Assessing Officer and dismissed the appeal filed by the Assessee.

The Hon’ble Tribunal by placing reliance of the coordinate bench in the case of Kaliandas Udyog Bhavan Premises Co-op Society Ltd. v. ITO, ITA No. 6547/Mum. /2017 vide order dated April 25, 2018 allowed the plea of the Assessee and directed the Assessing Officer to grant deduction under section 80P(2)(d) of the Act to the Assessee in respect of interest income earned from investment with co-operative banks.  (AY. 2018-19.)