ITAT Surat grants Section 80P deduction on co-operative bank deposit interest for housing society

ITAT Surat delivered a favorable ruling allowing a co-operative housing society to claim deductions under Section 80P(2)(d) on interest earned from deposits placed in co-operative banks. Alongside this determination, the tribunal formally directed the tax authorities to delete the corresponding disallowance made during assessment proceedings.

This decision provides clarity on the eligibility of co-operative housing societies to claim tax benefits on interest income derived from co-operative banking institutions. It addresses a frequent point of contention between tax auditors and housing societies regarding the interpretation of eligible income sources under Chapter VI-A.

Co-operative housing societies facing similar disallowances on bank interest should review their assessment orders in light of this Surat tribunal ruling. Tax practitioners representing such societies can leverage this precedent to contest similar additions during appellate hearings.