K-863, ELUMATHUR PRIMARY AGRICULTURAL COOP BANK LTD.,ERODE vs. ITO, WARD-2(1), ERODE

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ITA 1057/CHNY/2026Status: DisposedITAT Chennai21 April 2026AY 2020-213 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found merit in the assessee's contention that lower authorities did not provide a proper opportunity to be heard. The issue of deduction under Section 80P requires factual verification.

What were the facts?

The assessee, a cooperative bank, claimed deduction under Section 80P. The Assessing Officer (AO) and CIT(A) disallowed this deduction, relying on judicial precedents. The assessee argued that they were not given a proper opportunity to be heard.

What were the issues?

Whether the assessee was denied a proper opportunity to present their case regarding the Section 80P deduction. Whether factual verification is required for the Section 80P deduction claim.

Which sections of the Income-tax Act were involved?

Section 80P,Section 143(1),Section 143(3),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘D’ BENCH: CHENNAI

Before: SHRI GEORGE GEORGE KAND MS. PADMAVATHY.S

Hearing: 20.04.2026Pronounced: 21.04.2026

आदेश / O R D E R

PER PADMAVATHY.S, A.M: This appeal by the assessee is against the order of the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi, (in short "CIT(A)") passed u/s. 250 of the Income Tax Act, 1961 (in short "the Act") dated 15.01.2026 for Assessment Year (AY) 2020-21.

2.

The assessee is a primary agricultural cooperative society registered under Tamil Nadu Cooperative Societies Act, 1983. The assessee filed a return of income for AY 2020-21 on 04.01.2021 declaring Nil income after claiming deduction u/s. 80P(2)(a)(i) and 80P(2)(d) of the Act towards income

ITA No.1057/Chny/2026 K-863 Elumathur Primary Agricultural Cooperative Bank Ltd.

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from credit facilities to Members and interest from investments with cooperative societies. The return was processed u/s.143(1) of the Act determining the total income at Rs.26,17,640/-. Subsequently, the case was selected for scrutiny and the statutory notices were duly served on the assessee. The A.O while completing the assessment u/s. 143(3) of the Act did not accept the submissions of the assessee with regard to deduction claimed u/s. 80P of the Act and assessed the same income as done u/s. 143(1) of the Act. Aggrieved, the assessee filed further appeal before the CIT(A). The CIT(A) confirmed the addition by placing reliance on the decision of the Hon'ble Supreme Court in the case of Totgar's Cooperative Sale Society vs. ITO [2009] 314 ITR 302 (SC). The assessee is in appeal before the Tribunal against the order of the CIT(A).

3.

We have heard the parties, and perused the material available on record. The Ld. Authorized Representative (AR) of the assessee during the course of hearing drew our attention to the order passed u/s. 143(3) of the Act where the AO has assessed the income at Rs.26,17,640/- without attributing any reasons for rejecting the submissions of the assessee. From the perusal of the order of the CIT(A), we notice that the CIT(A) has upheld the disallowance of deduction claimed u/s. 80P of the Act without calling for any details from the assessee and by placing reliance on certain judicial precedence. Accordingly, we see merit in the contention of the assessee that the lower authorities have not given proper opportunity of being heard to the assessee. Further, the issue of deduction u/s.80P(2)(a)(i) and 80P(2)(d) of the Act needs factual verification. Considering the facts and circumstances peculiar to assessee's case, we are inclined to give one more opportunity to the assessee to substantiate the claim of deduction u/s. 80P of the Act by

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producing the required details. Accordingly, we remit the appeal back to the AO with a direction to call for necessary details and decide the issue in accordance with law. The assessee is required to submit the necessary details as may be called for and cooperate with assessment proceedings. It is ordered accordingly.

4.

In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced on 21st day of April, 2026 at Chennai.

Sd/- Sd/- (जॉज� जॉज� के) (पदमावती यस) (Padmavathy.S) (George George K) उपा�� / Vice President लेखा लेखा सद�य लेखा लेखा सद�य सद�य /Accountant Member सद�य चे�नई/Chennai, �दनांक/Dated: 21st April, 2026. EDN, Sr. P.S

आदेश क� �ितिल�प अ�े�षत/Copy to: 1. अपीलाथ�/Appellant 2. ��थ�/Respondent 3. आयकर आयु�/CIT, Chennai/Madurai/Coimbatore/Salem 4. िवभागीय �ितिनिध/DR 5. गाड� फाईल/GF EJTADA Digitally signed by EJTADA DURGA DURGA NARESH Date: 2026.04.27 NARESH 13:00:50 +05'30'

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