SHREE JAGADGURU MOUNESHWAR PATTIN SAHAKARI SANGH NIYAMIT,BAGALKOT vs. INCOME TAX OFFICER, WARD-1, BAGALKOT

ITA 1622/BANG/2025Status: DisposedITAT Bangalore09 October 2026AY 2018-198 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal dismissed Ground No. 2 regarding the assumption of jurisdiction, referencing a recent amendment by the Finance Act, 2026, inserting section 147A retrospectively from 01/04/2021. For Grounds No. 3 and 4, concerning the disallowance of deduction under section 80P, the Tribunal noted that it is undisputed that the assessee did not file its return under section 139(1). Section 80AC mandates that for deductions under Chapter VI (including section 80P) to be allowed, the return must be furnished on or before the due date specified under section 139(1). The assessee filed its return only in response to a section 148 notice, after the due date. The Tribunal relied on the Kerala High Court's decision in Nileshwar Range Kallu Chethu Vyavasaya Thozhilali Sahakarana Sangham v/s CIT, which held that after 01/04/2018, a deduction under section 80P is only permissible if the return is filed by the due date under section 139(1), even if filed in response to notices under sections 139(4), 142(1), or 148. The Tribunal acknowledged the assessee's application for condonation of delay filed under CBDT Circular No. 13 of 2023, which was pending when the AO passed the order. Therefore, in the interest of justice, the matter was restored to the AO to decide afresh after considering the outcome of the condonation application. If the delay is condoned, the 80P deduction is to be considered on merits. If rejected, the disallowance is sustained. Grounds 3 and 4 were allowed for statistical purposes.

What were the facts?

The assessee, Shree Jagadguru Mouneshwar Pattin Sahakari Sangh Niyamit, a co-operative credit society, is in appeal against the order dated 21/05/2025 passed by the CIT(A), NFAC, Delhi, for Assessment Year 2018-19. The assessee did not file its return of income under section 139(1). A notice under section 148A was issued, followed by a notice under section 148 on 08/04/2022. The assessee filed its return on 29/04/2022, declaring NIL income and claiming a deduction of ₹30,93,564 under section 80P. The Assessing Officer denied this deduction citing section 80AC, as the return was not filed by the due date under section 139(1). The CIT(A) upheld this disallowance. The assessee argued that the return filed in response to the section 148 notice should be considered sufficient compliance and that ignorance of law and small-scale operations led to the delay. The assessee also filed an application for condonation of delay before the CCIT-1, Bengaluru, as per CBDT Circular No. 13 of 2023.

What were the issues?

1. Whether the assumption of jurisdiction by the learned jurisdictional assessing officer was improper in view of CBDT Notification No.18/2022, requiring notice under Sec.148 to be issued only in a faceless manner? (Question of law) 2. Whether the provisions of the Act, including Sec.80AC, apply to a return filed in response to a notice under Sec.148 in the same manner as if such return were a return required to be filed under Sec.139, and therefore, the claim of deduction under Sec.80P should be upheld? (Question of mixed law and fact, concerning Section 80AC and Section 80P) Assessee's Contentions: - The return filed in response to the notice under section 148 should be treated as sufficient compliance with section 80AC, allowing the deduction under section 80P. - The assessee was unaware of the requirement to file an income tax return due to its small scale of operations and lack of direction from the Cooperative Department. - The delay in filing the return should be condoned as per CBDT Circular No. 13 of 2023. - The jurisdictional assessing officer's assumption of jurisdiction was improper due to the faceless assessment procedure. Revenue's Contentions: - The Revenue authorities relied on their orders, which denied the deduction under section 80P due to non-compliance with section 80AC, as the return was not filed by the due date specified under section 139(1).

Which sections of the Income-tax Act were involved?

Section 148A,Section 148,Section 139,Section 80P,Section 80AC,Section 147A,Section 144B,Section 119

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BANGALORE BENCHES, BANGALORE

Before: PRASHANT MAHARISHI & SHRI SANDEEP SINGH KARHAIL

PER SANDEEP SINGH KARHAIL, JUDICIAL MEMBER:

The assessee has filed the present appeal against the impugned order dated 21/05/2025, passed under section 250 of the Income Tax Act, 1961 (“the Act”) by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, [“lea

The order continues below.

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