Gujarat High Court Sustains Section 80P(2)(d) Deduction on Cooperative Bank Interest

The Gujarat High Court ruled in favor of a taxpayer by upholding deductions claimed under Section 80P(2)(d) of the Income Tax Act. The dispute centered on two crore one lakh rupees earned as interest from investments in cooperative banks. Additionally, the court rejected the Commissioner's attempt to revise the assessment order under Section 263 of the Act.

This judgment provides relief to cooperative entities that invest surplus funds in cooperative banks and claim corresponding tax exemptions. By setting aside the Section 263 revision, the court confirmed that original assessment orders granting such deductions were legally sound. It reinforces the position that interest income from cooperative bank deposits qualifies for specific statutory deductions under the Act.

Tax professionals representing cooperative societies should reference this Gujarat High Court ruling when defending Section 80P(2)(d) claims during scrutiny or revision proceedings. Cooperative entities can maintain their deduction claims on cooperative bank interest while awaiting further judicial consensus.