THE DEVELOPMENT MULTIPURPOSE CREDIT & CONSUMERS CO-OP SO LTD,PORBANDAR, GUJARAT vs. ITO WARD 2 (4), PORBANDAR, PORBANDAR, GUJARAT

ITA 458/RJT/2026Status: DisposedITAT Rajkot15 October 2026AY 2017-184 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal condoned the delay of 31 days in filing the appeal, being satisfied with the assessee's explanation. Regarding the substantive issues, the Tribunal noted that the assessee's appeal was dismissed by the Ld. CIT(A) due to non-compliance. Considering the nature of the assessee, the issues involved, and the assessee's request for an opportunity to substantiate its claims with documentary evidence, the Tribunal held that the matter requires fresh adjudication in the interest of justice. Accordingly, the impugned order of the Ld. CIT(A) was set aside, and the matter was restored to the file of the AO for fresh adjudication on merits. The AO was directed to examine the relevant documentary evidence, afford the assessee a reasonable opportunity of being heard, and decide the issues independently without being influenced by any observations made in the order. The assessee was directed to cooperate fully with the AO. The appeal was allowed for statistical purposes.

What were the facts?

The assessee, The Development Multipurpose Credit & Consumers Co-Op So Ltd, filed an appeal for Assessment Year 2017-18 against an order passed by the Ld. Commissioner of Income Tax (Appeal) dated 31.12.2025, which arose from an order passed by the Assessing Officer (AO) under section 143(3) dated 16.12.2019. The assessee, a co-operative society providing loans to members, declared nil income after claiming deduction under section 80P(2)(a)(i). The AO disallowed Rs.39,50,000/- debited as provisions (bad debt reserve, building fund, members' bonus fund), treating them as not actual expenditure. The AO also treated Rs.19,05,686/- interest income from bank fixed deposits as income from other sources, denying section 80P(2)(a)(i) deduction. The assessee's appeal before the Ld. CIT(A) was dismissed for non-compliance. The present appeal to the ITAT was filed with a delay of 31 days.

What were the issues?

1. Whether the Tribunal should condone the delay of 31 days in filing the appeal, considering the assessee's explanation. 2. Whether the matter should be restored to the Assessing Officer for fresh adjudication, allowing the assessee an effective opportunity to present documentary evidence and be heard, given that the appeal before the Ld. CIT(A) was dismissed on grounds of non-compliance. Assessee's Contention: The assessee argued that its appeal before the Ld. CIT(A) was dismissed due to non-compliance. It possesses supporting documents and requested the matter be restored to the AO for fresh adjudication after considering the evidence and providing an effective hearing opportunity. Revenue's Contention: The Ld. Senior Departmental Representative supported the order of the Ld. CIT(A).

Which sections of the Income-tax Act were involved?

Section 80P(2)(a)(i),Section 143(3),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, Rajkot Bench, Rajkot

Before: Dr. Arjun Lal Saini & Shri Sonjoy Sarma

For Appellant: Shri Chetan Agarwal, Ld. AR
For Respondent: Shri Ganesh Iyer, Ld. Sr. DR
Hearing: 13/10/2026Pronounced: 15/10/2026

Per, Shri Sonjoy Sarma, JM: Captioned appeal filed by the assessee, pertaining to Assessment Year (AY) 2017-18, is directed against the order under section 250 of the Income-tax Act, 1961 [hereinafter referred to as ‘the Act’] passed by the Ld. Commissioner of Income Tax (Appeal), [hereinafter referred to as ‘Ld.CIT(A)’], dated 31.12.2025, which in turn arises out of an order passed by assessing officer u/s. 143(3) of the Act,

The order continues below.

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