Pune ITAT denies deduction
u/s. 80P(2)(a)(i) to assessee (a Co-operative society engaged in banking
business) in respect of ‘gross’ commission receipts (arising on account of
collecting electricity charges for & on behalf of MSEB) for AY 2012-13;
ITAT holds that since the amount of gross receipt from MSEB commission is less
than the amount of expenses incurred for earning such commission, there can be
no distinct deduction u/s. 80P because of the negative income earned by
assessee from this activity; Referring to Sec. 80AB, ITAT rules that where
deduction is required to be made u/s. 80P (which is covered under
Chapter-VI-A), it is ‘the amount of income of that nature as computed in
accordance with the provisions of the Act’, which shall be considered as
eligible for deduction; Thus, ITAT holds that the eligible amount for deduction
can be the `income’ and not the `gross receipts’ from the specified source;
Relies on SC ruling in Motilal Pesticides (I) (P) Ltd and Bombay HC ruling in
Asian Cable Corporation Ltd. rendered in context of Sec. 80HH / Sec. 80-O
deductions.:
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