SA 45 THALAIVASAL PACB LTD.,NAMAKKAL vs. ITO, WARD-1(6), SALEM

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ITA 727/CHNY/2026Status: DisposedITAT Chennai26 May 2026AY 2020-214 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the lower authorities had not properly discussed the status of the society and its income. Therefore, the matter was remanded to the Assessing Officer for a fresh assessment.

What were the facts?

The assessee, a cooperative society, claimed a deduction under Section 80P. The Assessing Officer denied this deduction, holding the society to be a cooperative bank. The CIT(A) dismissed the appeal for non-prosecution.

What were the issues?

Whether the cooperative society is eligible for deduction under Section 80P, and if Section 80P(4) is applicable to it.

Which sections of the Income-tax Act were involved?

Section 80P,Section 80P(4)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, CHENNAI BENCHES, CHENNAI

Before: HON’BLE INTURI RAMA RAO & HON’BLE MANU KUMAR GIRI

आदेश / ORDER PER INTURI RAMA RAO, ACCOUNTANT MEMBER: This appeal filed by the Assessee directed against the order of ld.Commissioner of Income Tax(Appeal)[NFAC], dated 27.11.2025 passed u/s.250 of the Income Tax Act, 1961 for the Assessment Year 2020-21.

2.

The Assessee raised the following grounds of appeal :

“1) The Impugned Order is bad, erroneous and unsustainable in law.

2) The Learned Commissioner (Appeals) erred in not considering the records properly including the submissions filed during assessment and the grounds raised.

3) Without prejudice, the Learned Commissioner (Appeals) erred in observing that the Appellant did not file documentary evidences in support of the deduction claimed under Section 80P before the Assessing Officer, which observation is factually incorrect.

4) Without prejudice, the Learned Commissioner (Appeals) also erred in observing that the Appellant merely cited judgments without considering that rejection of deduction by the AO itself was by citing judgments, which had to be countered only by citing recent and factually relevant judgments.

5) Without prejudice, the Learned Commissioner (Appeals) erred in not considering that the Assessing Officer erroneously applied Section 80P(4) to the Appellant, which is a Cooperative Society registered under TN Coop Societies Act, 1983 and does not hold banking license issued by the RBI.

6) Without prejudice, the Learned Commissioner (Appeals) also erred in not considering that the Assessing Officer's reliance on Totgars Coop Sales Society Limited case is out of place, as it was rendered in the context of claim of deduction u/s.80P(2)(a)(i) in respect of interest earned out of surplus funds, which is not so in the instant case, thereby acting mechanically and arbitrarily.

And for other grounds of appeal that may adduced later, the Appellant sincerely prays that the present appeal be admitted, considered and justice be rendered.”

3.

Briefly the facts of the case are that the appellant is a Co-operative Society registered under Tamilnadu Co-operative Societies Act, 1983. It is classified as Primary Agricultural Co-operative Society. The appellant society filed its return of income for the on 15.02.2021 for the Assessment Year 2020- 21 under the provisions of section 139(1) of the Act declaring income at Rs.NIL after claiming deduction u/s.80P of the Income Tax Act of Rs.34,76,600/-. While doing so, the Assessing Officer denied the claim for deduction u/s.80P of the Act by holding that the appellant is Co-operative Bank and hit by provisions of sub-section 4 of section 80P of the Act.

4.

Being aggrieved by the above assessment order, the appellant preferred an appeal before ld.CIT(A), who vide impugned order dismissed the appeal in limine for non-prosecution.

5.

Being aggrieved by the order of ld.CIT(A), the appellant is in appeal before us in the present appeal.

6.

We heard rival submissions and perused the material available on record. The issue that arises for our consideration is whether the appellant society is eligible for deduction to claim deduction u/s.80P of the Act. We had carefully perused the orders passed by the Lower Authorities. The Lower Authorities had not discussed the status of the appellant-society as well as not discussed the nature of income derived by the appellant-society and therefore, we are of the considered opinion that matter requires remand to the file of the Assessing Officer for denovo assessment in accordance with law after affording opportunity of being heard to the appellant-society.

7.

In the result, appeal of the assessee is partly allowed for statistical purpose. Order pronounced in the open Court on 26th May, 2026.

Sd/- Sd/- (MANU KUMAR GIRI) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER Chennai; �दनांक / Dated : 26th May, 2026 SGR, Sr.PS आदेश क� ��त�ल�प अ�े�षत / Copy of the Order forwarded to : अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The CIT Chennai/Madurai/Coimbatore/Salem. 4. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, “ए” ब�च, चे�नई / DR, ITAT Chennai. गाड� फ़ाइल / Guard File. 5.

Digitally signed by GANGADHARA GANGADHARA RAO SALEELA RAO SALEELA Date: 2026.06.03 18:40:25 +05'30'

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