Section 80P of Income Tax Act, 1961— The appeal is filed by the assessee against the order of CIT(A). the issue in the preset case is with respect to denial of claim of deduction u/s. 80P(2)(b) of the Act on milk sold by the assessee to other than federal society.

Held that— The Assessing Officer is directed to decide the issue in line with the decision in the case of Fattesinghrao Naik (Appa) Sahakari Dudh Utpadak Sangh Limited Vs. ITO (supra), in accordance with law and after considering the submissions of assessee. As far as the disallowance u/s. 40(a)(ia) is concerned, I find force in the arguments of ld. AR. I find that Hon’ble Gujarat High Court in the case of ITO Vs. Keval Construction (2013) 33 taxmann.com 277 (Guj.) has held that disallowance for non-deduction of TDS liability would increase the profits of the assessee from business and ultimate profit would qualify for deduction. The Assessing Officer shall thus also examine the issue of disallowance u/s. 40(a)(ia) and its eligibility for deduction in the light of the aforesaid decision and thereafter decide the issue, in accordance with law.[M/S. SHRIMAN BABASAHEB DESHMUKH MULTI STATE CO-OP. DAIRY LTD. VERSUS THE INCOME TAX OFFICER, WARD – 2 (3) , SANGLI][2019] 18 ITCD Online (8) [ ITAT PUNE]