Interest on Fixed Deposit earned by Registered Co-operative Societies from Co-operative Banks

a)  Kindly advise whether fixed deposit interest earned by registered co-operative societies from co-operative banks are exempted from Income Tax?  Will the fixed deposit interest from other banks are exempted from Income Tax, for registered co-operative societies?  What if interest earned on savings bank account? 

b)  Assesse has paid commission to a foreigner for the works performed out of India, without deducting TDS.  Will the expenses be disallowed? The foreigner belongs to a country which has a DTTA with India.  What are the documents to be produced to the AO, if he disallows the expenses.

Thanks in advance.