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Facts
The assessee filed two appeals against orders of the CIT(A) for AY 2013-14 and 2015-16. The first appeal (AY 2013-14) concerned the dismissal of the assessee's appeal by the CIT(A) due to a 67-day delay in filing, without condonation. The second appeal (AY 2015-16) concerned the denial of deduction under Section 80P(2)(d) and the rejection of a rectification application.
Held
For AY 2013-14, the Tribunal held that the CIT(A) wrongly dismissed the appeal without proper verification of the filing date. The matter was restored to the CIT(A) for fresh adjudication on delay condonation and merits. For AY 2015-16, the Tribunal found that the lower authorities failed to provide adequate reasons for rejecting the rectification application and that the issue required reconsideration. The matter was remanded to the Assessing Officer for a reasoned order.
Key Issues
Whether the appeal filed by the assessee was within the limitation period, and whether the denial of deduction under Section 80P was a "mistake apparent from the record" eligible for rectification.
Sections Cited
143(1), 143(3), 154, 80P, 80P(2)(c), 80P(2)(d)
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Income Tax Appellate Tribunal, MUMBAI BENCH “H (SMC
Before: SHRI OM PRAKASH KANT & SHRI RAHUL CHAUDHARY
ORDER PER OM PRAKASH KANT, AM These two appeals by the assessee are directed against two separate orders, both dated 09.10.2023, passed by the Ld. Commissioner of Income-tax (Appeals) – National Faceless Appeal Centre, Delhi [in short ‘the Ld. CIT(A)’] for assessment years 2013- 14 and 2015-16 respectively. As both appeals being connected with CCI Chambers Co-op. HSG. SOC. Ltd. CCI Chambers 2 & 3543/MUM/2025 & 3543/MUM/2025 the single assessee, same were heard together and same were heard together and disposed off by way of this consolidated order for the sake of convenience. way of this consolidated order for the sake of convenience. way of this consolidated order for the sake of convenience.
The grounds raised by the assessee in appeal for assessment The grounds raised by the assessee in appeal for assessment The grounds raised by the assessee in appeal for assessment year 2013-14 are reproduced as under: 14 are reproduced as under:
On the facts and circumstances of the case and in law: On the facts and circumstances of the case and in law: On the facts and circumstances of the case and in law: Ground No. 1: Appeal di Ground No. 1: Appeal dismissed on account of smissed on account of condonation of delay condonation of delay 1. The learned CIT(A) erred in dismissing the appeal 1. The learned CIT(A) erred in dismissing the appeal 1. The learned CIT(A) erred in dismissing the appeal (without adjudicating on the merits of the case), on the (without adjudicating on the merits of the case), on the (without adjudicating on the merits of the case), on the ground that the appeal is barred by limitation. ground that the appeal is barred by limitation.
2. The learned CIT(A) erred in alleging that the 2. The learned CIT(A) erred in alleging that the 2. The learned CIT(A) erred in alleging that the Assessee has filed an appeal on 16th June, 2016, with a delay of 67 has filed an appeal on 16th June, 2016, with a delay of 67 has filed an appeal on 16th June, 2016, with a delay of 67 days and without making an application for condonation of days and without making an application for condonation of days and without making an application for condonation of delay, although the appeal was filed on 21st April, 2016 delay, although the appeal was filed on 21st April, 2016 delay, although the appeal was filed on 21st April, 2016 (i.e. within 30 days from date of service i.e. 22nd March, (i.e. within 30 days from date of service i.e. 22nd March, (i.e. within 30 days from date of service i.e. 22nd March, 2016), which w 2016), which was duly acknowledged by way of stamp by as duly acknowledged by way of stamp by the learned CIT(A) on Form No. 35 (which was submitted to the learned CIT(A) on Form No. 35 (which was submitted to the learned CIT(A) on Form No. 35 (which was submitted to the CIT(A)-28 along with other documents and hence there 28 along with other documents and hence there 28 along with other documents and hence there was no delay in filing the appeal before the first appellate was no delay in filing the appeal before the first appellate was no delay in filing the appeal before the first appellate authority.
The learned CIT(A) erred i 3. The learned CIT(A) erred in dismissing the appeal on the n dismissing the appeal on the basis of an incorrect information pertaining to the date of basis of an incorrect information pertaining to the date of basis of an incorrect information pertaining to the date of institution of appeal, which has resulted in confirming a institution of appeal, which has resulted in confirming a institution of appeal, which has resulted in confirming a huge addition and unnecessary harassment to the huge huge addition and unnecessary harassment to addition and unnecessary harassment to the the Appellant and huge litigation costs to the Appellant. Appellant and huge litigation costs to the Appellant. Appellant and huge litigation costs to the Appellant. Without prejudice, on the merits of the case ut prejudice, on the merits of the case Ground No. 2: Addition of Rs. 51,20,000/ Ground No. 2: Addition of Rs. 51,20,000/-
1. 1. The learned AO erred in making an addition of Rs.
1. The learned AO erred in making an addition of Rs.
1. The learned AO erred in making an addition of Rs. 51,20,000/- being voluntary contribution to the building being voluntary contribution to the building repairs and amenity fund by member. repairs and amenity fund by member.
CCI Chambers Co-op. HSG. SOC. Ltd. CCI Chambers 3 & 3543/MUM/2025 & 3543/MUM/2025
2. The learned AO erred in 2. The learned AO erred in not following the principles of not following the principles of consistency where the Hon'ble Income Tax Appellate consistency where the Hon'ble Income Tax Appellate consistency where the Hon'ble Income Tax Appellate Tribunal in Appellant's own case for A.Y. 08 Tribunal in Appellant's own case for A.Y. 08-09 and 09 09 and 09-10 has decided this issue in favour of the Appellant. has decided this issue in favour of the Appellant.
3. The learned AO erred in not following the principles of 3. The learned AO erred in not following the principles of 3. The learned AO erred in not following the principles of mutuality lity lity which which which has has has been been been duly duly duly accepted accepted accepted by by by the the the jurisdictional High Court in the case of : jurisdictional High Court in the case of :- i. Sind Co-op. Hag. Soc. Ltd. 317 ITR 47 (Bom HC) op. Hag. Soc. Ltd. 317 ITR 47 (Bom HC) ii. Mittal Court Premises Co ii. Mittal Court Premises Co-op. Soc. Ltd. (Bom HC) 320 ITR op. Soc. Ltd. (Bom HC) 320 ITR 414 and consequently erred in assessing the sum as 'Income and consequently erred in assessing the sum as 'Income and consequently erred in assessing the sum as 'Income from Other Sources'. 3. We have heard the rival submissions advanced by the parties We have heard the rival submissions advanced by the parties We have heard the rival submissions advanced by the parties and carefully perused the material available on record. The and carefully perused the material available on record. The and carefully perused the material available on record. The principal grievance raised in Ground No. 1 of the appeal pertains to principal grievance raised in Ground No. 1 of the appeal pertains to principal grievance raised in Ground No. 1 of the appeal pertains to the rejection of the assessee’s appeal by the the rejection of the assessee’s appeal by the Ld. CIT(A) Ld. CIT(A) on the ground of delay of 67 days in filing the same, and the consequential ground of delay of 67 days in filing the same, and the consequential ground of delay of 67 days in filing the same, and the consequential refusal to condone such delay in the absence of an application for refusal to condone such delay in the absence of an application for refusal to condone such delay in the absence of an application for condonation. The learned counsel for the The learned counsel for the assessee had assessee had submitted that there was, in fact, no delay in that there was, in fact, no delay in the filing of the appeal. It was the filing of the appeal. It was contended that the assessment order contended that the assessment order dated 10/03/2016 10/03/2016 was served upon the assessee on 22.03.2016, and the appeal was filed in on the assessee on 22.03.2016, and the appeal was filed in on the assessee on 22.03.2016, and the appeal was filed in physical format before the jurisdictional CIT(A) on 21.04.2016, physical format before the jurisdictional CIT(A) on 21.04.2016, physical format before the jurisdictional CIT(A) on 21.04.2016, which was well within the prescrib which was well within the prescribed period of limitation of 30 days. ed period of limitation of 30 days. The ld CIT(A) not admitted the appeal of the assessee for the reason The ld CIT(A) not admitted the appeal of the assessee for the reason The ld CIT(A) not admitted the appeal of the assessee for the reason that neither the assessee acknowledged the delay nor filed any that neither the assessee acknowledged the delay nor filed any that neither the assessee acknowledged the delay nor filed any CCI Chambers Co-op. HSG. SOC. Ltd. CCI Chambers 4 & 3543/MUM/2025 & 3543/MUM/2025 application for condonation of delay. application for condonation of delay. The finding of the Ld. CIT(A) The finding of the Ld. CIT(A) however is reproduced as under: reproduced as under:
“7. In the present case the delay in filing the appeal is not “7. In the present case the delay in filing the appeal is not “7. In the present case the delay in filing the appeal is not explained by the appellant. explained by the appellant. The due date of filing appeal The due date of filing appeal before the CIT(A) was 21.04.2016. However, no such appeal before the CIT(A) was 21.04.2016. However, no such appeal before the CIT(A) was 21.04.2016. However, no such appeal was filed on that day. was filed on that day. 7.1 It is not a case of an ordinar 7.1 It is not a case of an ordinary delay of a few days so that the y delay of a few days so that the delay in filing this appeal could be sue moto condoned by me. delay in filing this appeal could be sue moto condoned by me. delay in filing this appeal could be sue moto condoned by me. Accordingly, in the facts and circumstances of the case when the Accordingly, in the facts and circumstances of the case when the Accordingly, in the facts and circumstances of the case when the assessee has NOT given any explanation for cause of delay, I am assessee has NOT given any explanation for cause of delay, I am assessee has NOT given any explanation for cause of delay, I am of the considered view that the of the considered view that the assessee has failed to establish assessee has failed to establish that there exists a sufficient cause for the delay and that there exists a sufficient cause for the delay and that there exists a sufficient cause for the delay and consequently the delay of 67 days in filing the appeal cannot be consequently the delay of 67 days in filing the appeal cannot be consequently the delay of 67 days in filing the appeal cannot be condoned. 7.2 Thus, the delay is nothing but negligence and inaction on part 7.2 Thus, the delay is nothing but negligence and inaction on part 7.2 Thus, the delay is nothing but negligence and inaction on part of the appellant which co of the appellant which could have been very well avoided by the uld have been very well avoided by the exercise of due care and attention. Lackadaisical approach in exercise of due care and attention. Lackadaisical approach in exercise of due care and attention. Lackadaisical approach in filling Form No. 35 and casual and non filling Form No. 35 and casual and non-challant way of filing challant way of filing appeals before appellate authorities cannot be encouraged. There appeals before appellate authorities cannot be encouraged. There appeals before appellate authorities cannot be encouraged. There exists no reason for condoni exists no reason for condoning the delay in filing the present ng the delay in filing the present appeal. So, there is no reason for condoning such a delay in this appeal. So, there is no reason for condoning such a delay in this appeal. So, there is no reason for condoning such a delay in this case. Considering above the delay is case. Considering above the delay is not condoned.” 3.1 It is further noticed that the Ld. CIT(A), in para 1 of the It is further noticed that the Ld. CIT(A), in para 1 of the It is further noticed that the Ld. CIT(A), in para 1 of the impugned order, observed that the appea impugned order, observed that the appeal was instituted on l was instituted on 16.06.2016 before the before the ld. jurisdictional Commissioner of income Commissioner of income- tax(Appeals) and was later and was later migrated to the National Faceless Appeal to the National Faceless Appeal Centre (NFAC). The Ld. CIT(A) counted the period of delay from the The Ld. CIT(A) counted the period of delay from the The Ld. CIT(A) counted the period of delay from the date of the assessment order date of the assessment order passed upto 16.06.2016. pto 16.06.2016. However, the assessee has placed reliance on a stamped copy of Form No. 35 the assessee has placed reliance on a stamped copy of Form No. 35 the assessee has placed reliance on a stamped copy of Form No. 35 bearing the date 21.04.2016 from the office of the jurisdictional bearing the date 21.04.2016 from the office of the jurisdictional bearing the date 21.04.2016 from the office of the jurisdictional CIT(A), in support of the contention that the appeal had been duly CIT(A), in support of the contention that the appeal had been duly CIT(A), in support of the contention that the appeal had been duly filed within the prescribed tim filed within the prescribed time.
CCI Chambers Co-op. HSG. SOC. Ltd. CCI Chambers 5 & 3543/MUM/2025 & 3543/MUM/2025 3.2 In our considered view, the question whether the appeal was In our considered view, the question whether the appeal was In our considered view, the question whether the appeal was filed within the period of limitation is essentially a question of fact filed within the period of limitation is essentially a question of fact filed within the period of limitation is essentially a question of fact which requires verification. which requires verification. Before us, the assessee has filed a copy Before us, the assessee has filed a copy of the assessment order wherein seal of the assessee’s society along of the assessment order wherein seal of the assessee’s society along of the assessment order wherein seal of the assessee’s society along with date has been submitted. with date has been submitted. The assessee contended that The assessee contended that assessment order dated 10/03/2016 was received assessment order dated 10/03/2016 was received on 22/03/2016. on 22/03/2016. For ready reference said For ready reference said page of assessment order is reproduced as is reproduced as under:
3.3 As regarding the date of the filing of the appeal before the Ld. As regarding the date of the filing of the appeal before the Ld. As regarding the date of the filing of the appeal before the Ld. CIT(A) in physical format in physical format, before us the assessee has filed a copy of the assessee has filed a copy of CCI Chambers Co-op. HSG. SOC. Ltd. CCI Chambers 6 & 3543/MUM/2025 & 3543/MUM/2025 the Form No. 35, wherein there is a stamp from the office of the L wherein there is a stamp from the office of the Ld. wherein there is a stamp from the office of the L Commissioner of Income Commissioner of Income-tax (Appeals) bearing date as 21.04.2016. bearing date as 21.04.2016. In view of both these photocopies In view of both these photocopies of documents filed filed, matter needs verification by the Ld. verification by the Ld. CIT(A).
3.4 We also note that We also note that the Ld. CIT(A) has not issued any notice to the Ld. CIT(A) has not issued any notice to the assessee seeking a the assessee seeking an explanation on the question of condonation n explanation on the question of condonation of delay, nor has the record been examined for ascertaining the of delay, nor has the record been examined for ascertaining the of delay, nor has the record been examined for ascertaining the actual date of filing and service of the assessment order. actual date of filing and service of the assessment order. actual date of filing and service of the assessment order.
3.5 In light of the above and in the interest of justice, we deem it In light of the above and in the interest of justice, we deem it In light of the above and in the interest of justice, we deem it appropriate to restore the matter appropriate to restore the matter back to the file of the Ld. CIT(A) to the file of the Ld. CIT(A) for the purpose of verifying (i) the actual date of service of the for the purpose of verifying (i) the actual date of service of the for the purpose of verifying (i) the actual date of service of the assessment order on the assessee from the records of the Assessing assessment order on the assessee from the records of th assessment order on the assessee from the records of th Officer, and (ii) the date of receipt of Form No. 35 by the office of the Officer, and (ii) the date of receipt of Form No. 35 by the offi Officer, and (ii) the date of receipt of Form No. 35 by the offi jurisdictional CIT(A). Thereafter, he shall decide the issue of jurisdictional CIT(A). Thereafter, he shall decide the issue of jurisdictional CIT(A). Thereafter, he shall decide the issue of condonation of delay if so required condonation of delay if so required.
3.6 It has also been submitted before us by the Ld. Counsel for It has also been submitted before us by the Ld. Counsel for It has also been submitted before us by the Ld. Counsel for the assessee that the appeal filed in physical format is still pending assessee that the appeal filed in physical format is still pending assessee that the appeal filed in physical format is still pending before the office of the before the office of the ld jurisdictional CIT(A), whereas the Ld. CIT(A), whereas the Ld. CIT(A) has recorded that the said appeal has been migrated to the CIT(A) has recorded that the said appeal has been mi CIT(A) has recorded that the said appeal has been mi NFAC. This fact of pendency of appeal filed in physical format has NFAC. This fact of pendency of appeal filed in physical NFAC. This fact of pendency of appeal filed in physical been explained by the assessee through an affidavit, and been explained by the assessee through an affidavit, and been explained by the assessee through an affidavit, and accordingly, the veracity of this claim shall also be verified by the accordingly, the veracity of this claim shall also be verified by the accordingly, the veracity of this claim shall also be verified by the Ld. CIT(A).
CCI Chambers Co-op. HSG. SOC. Ltd. CCI Chambers 7 & 3543/MUM/2025 & 3543/MUM/2025 3.7 Upon such verification, if it is found that the appeal had indeed Upon such verification, if it is found that the appeal had indeed Upon such verification, if it is found that the appeal had indeed been filed within the period of been filed within the period of limitation, the Ld. CIT(A) shall limitation, the Ld. CIT(A) shall proceed to decide the appeal on merits in accordance with law, proceed to decide the appeal on merits in accordance with law, proceed to decide the appeal on merits in accordance with law, treating the appeal filed either in physical format or electronically as treating the appeal filed either in physical format or electronically as treating the appeal filed either in physical format or electronically as valid. However, in the event the appeal is found to have been filed valid. However, in the event the appeal is found to have been filed valid. However, in the event the appeal is found to have been filed belatedly, the assessee shall be granted an opportunity to file an ssee shall be granted an opportunity to file an ssee shall be granted an opportunity to file an appropriate application for condonation of delay along with a appropriate application for condonation of delay along with a appropriate application for condonation of delay along with a supporting affidavit. The Ld. CIT(A) shall thereafter adjudicate the supporting affidavit. The Ld. CIT(A) shall thereafter adjudicate the supporting affidavit. The Ld. CIT(A) shall thereafter adjudicate the issue of condonation of delay in accordance with law and proceed to issue of condonation of delay in accordance with law and proceed to issue of condonation of delay in accordance with law and proceed to dispose of the appeal on merits if the delay is condoned. f the appeal on merits if the delay is condoned. f the appeal on merits if the delay is condoned. The ground No. 1 raised in the appeal is accordingly allowed for statistical No. 1 raised in the appeal is accordingly allowed for statistical No. 1 raised in the appeal is accordingly allowed for statistical purposes.
As regards Ground No. 2, which concerns the merits of the As regards Ground No. 2, which concerns the merits of the As regards Ground No. 2, which concerns the merits of the addition, the same does not require adjudication at this stage since addition, the same does not require adjudication at this s addition, the same does not require adjudication at this s the matter has been remanded to the Ld. CIT(A). Accordingly, the matter has been remanded to the Ld. CIT(A). Accordingly, the matter has been remanded to the Ld. CIT(A). Accordingly, Ground No. 2 is dismissed as infructuous. Ground No. 2 is dismissed as infructuous.
Now, we take up the appeal of the assessee for assessment we take up the appeal of the assessee for assessment we take up the appeal of the assessee for assessment year 2015-16. The grounds raised
by the assessee are reproduced 16. The grounds raised by the assessee are reproduced 16. The grounds raised by the assessee are reproduced as under:
“On the facts and circumstances of case and in law: facts and circumstances of case and in law: Ground No. 1: Rectification Order u/s. 154 Ground No. 1: Rectification Order u/s. 154 (i) The learned CIT(A) failed to take into consideration that the (i) The learned CIT(A) failed to take into consideration that the (i) The learned CIT(A) failed to take into consideration that the AO/CPC made a mistake by denying deduction u/s. 80P (which AO/CPC made a mistake by denying deduction u/s. 80P (which AO/CPC made a mistake by denying deduction u/s. 80P (which the Assesse is eligible to claim), which is the Assesse is eligible to claim), which is apparent in the apparent in the Intimation Order u/s. 143(1), which resulted in an addition of Rs. Intimation Order u/s. 143(1), which resulted in an addition of Rs. Intimation Order u/s. 143(1), which resulted in an addition of Rs.
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15,46,810/-, which is beyond the scope of section 143(1) and the , which is beyond the scope of section 143(1) and the , which is beyond the scope of section 143(1) and the rectification application filed by the Assessee is valid and legal, rectification application filed by the Assessee is valid and legal, rectification application filed by the Assessee is valid and legal, (ii) The learned CIT(A) failed to take (ii) The learned CIT(A) failed to take into consideration that the into consideration that the Intimation u/s. 143(1) passed by the CPC/AO, has arbitrarily Intimation u/s. 143(1) passed by the CPC/AO, has arbitrarily Intimation u/s. 143(1) passed by the CPC/AO, has arbitrarily denied the deduction u/s. 80P, without providing and valid denied the deduction u/s. 80P, without providing and valid denied the deduction u/s. 80P, without providing and valid justification and therefore the right to apply for a rectification u/s. justification and therefore the right to apply for a rectification u/s. justification and therefore the right to apply for a rectification u/s. 154, to the AO is legal and valid, a 154, to the AO is legal and valid, as it is a mistake apparent on s it is a mistake apparent on record. (iii) The learned CIT(A) and AO/CPC erred in confirming the denial (iii) The learned CIT(A) and AO/CPC erred in confirming the denial (iii) The learned CIT(A) and AO/CPC erred in confirming the denial of deduction u/s. 80P, with respect to Interest income of Rs. of deduction u/s. 80P, with respect to Interest income of Rs. of deduction u/s. 80P, with respect to Interest income of Rs. 15,46,811/- earned from appellant's investment with co earned from appellant's investment with co-operative earned from appellant's investment with co bank, on the ground that bank, on the ground that the issue is debatable issue. (iv) The Learned CIT(A) failed to take into consideration that the (iv) The Learned CIT(A) failed to take into consideration that the (iv) The Learned CIT(A) failed to take into consideration that the deduction was claimed correctly in the return and that the deduction was claimed correctly in the return and that the deduction was claimed correctly in the return and that the disallowance by the CPC has happened due to a clerical, disallowance by the CPC has happened due to a clerical, disallowance by the CPC has happened due to a clerical, computational, or processing error and ther computational, or processing error and therefore the mistake is not efore the mistake is not debatable. (v) Without prejudice the learned CIT(A) in his Order rejecting the (v) Without prejudice the learned CIT(A) in his Order rejecting the (v) Without prejudice the learned CIT(A) in his Order rejecting the appeal against the rectification proceedings, has himself admitted appeal against the rectification proceedings, has himself admitted appeal against the rectification proceedings, has himself admitted that the allowability of deduction u/s. 80P(2)(d) is a debatable that the allowability of deduction u/s. 80P(2)(d) is a debatable that the allowability of deduction u/s. 80P(2)(d) is a debatable issue and failed to issue and failed to take into consideration that the AO/CPC could take into consideration that the AO/CPC could not have passed an adverse order, rejecting the deduction u/s. not have passed an adverse order, rejecting the deduction u/s. not have passed an adverse order, rejecting the deduction u/s. 80P(2)(d) and therefore the application u/s. 154 for rectifying the 80P(2)(d) and therefore the application u/s. 154 for rectifying the 80P(2)(d) and therefore the application u/s. 154 for rectifying the action of AO/CPC is valid and legal. action of AO/CPC is valid and legal. Without prejudice Without prejudice Ground No. 3: Denial of Ground No. 3: Denial of Deduction u/s. 80P(2)(d) (i) The learned CIT(A) erred in non adjudicating the appeal on the (i) The learned CIT(A) erred in non adjudicating the appeal on the (i) The learned CIT(A) erred in non adjudicating the appeal on the merits of the case where there has been a denial of deduction u/s. merits of the case where there has been a denial of deduction u/s. merits of the case where there has been a denial of deduction u/s. 80P, with respect to Interest income of Rs. 15,46,811/ 80P, with respect to Interest income of Rs. 15,46,811/ 80P, with respect to Interest income of Rs. 15,46,811/- earned from appellant's investment with from appellant's investment with co-operative bank (ii) The learned CIT(A) failed to take into consideration the (ii) The learned CIT(A) failed to take into consideration the (ii) The learned CIT(A) failed to take into consideration the provisions of section 80P(d) which reads as under: provisions of section 80P(d) which reads as under:- "in respect of "in respect of any income by way of interest or dividends derived by the co any income by way of interest or dividends derived by the co any income by way of interest or dividends derived by the co- operative society from its investments with any operative society from its investments with any other co other co-operative society, the whole of such income." society, the whole of such income." Without prejudice Without prejudice Ground No. 4: Denial of Deduction u/s. 80P(2)(c) Ground No. 4: Denial of Deduction u/s. 80P(2)(c)
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(i) The learned CIT(A) failed to take into consideration that the (i) The learned CIT(A) failed to take into consideration that the (i) The learned CIT(A) failed to take into consideration that the claim u/s. 80P(2) (c) of Rs. 50,000, made by the Assessee in the claim u/s. 80P(2) (c) of Rs. 50,000, made by the Assessee in the claim u/s. 80P(2) (c) of Rs. 50,000, made by the Assessee in the Return of Income, is in accordance with the provisions of law and urn of Income, is in accordance with the provisions of law and urn of Income, is in accordance with the provisions of law and arbitrary denial of the same in the Intimation u/s. 143(1) is a arbitrary denial of the same in the Intimation u/s. 143(1) is a arbitrary denial of the same in the Intimation u/s. 143(1) is a mistake apparent on record, and therefore ought to be mistake mistake apparent on record, and therefore ought apparent on record, and therefore ought to be to be adjudicated upon upon 5.1 The brief facts of the case are that the assessee The brief facts of the case are that the assessee The brief facts of the case are that the assessee filed its return of income on 24.09.2015, declaring Nil total income. The return was of income on 24.09.2015, declaring Nil total income. The return was of income on 24.09.2015, declaring Nil total income. The return was processed under Section 143(1) of the Act processed under Section 143(1) of the Act, wherein wherein the claim of deduction under Chapter VIA amounting to deduction under Chapter VIA amounting to ₹15,46,811/ 15,46,811/– was not allowed. The assessee subsequently filed a re allowed. The assessee subsequently filed a rectification application ctification application under Section 154 of the Act before the learned Assessing Officer under Section 154 of the Act before the learned Assessing Officer under Section 154 of the Act before the learned Assessing Officer (AO), contending that it, being a co , contending that it, being a co-operative housing society, was operative housing society, was entitled to deduction under Section 80P(2)(d) of the Act in respect of entitled to deduction under Section 80P(2)(d) of the Act in respect of entitled to deduction under Section 80P(2)(d) of the Act in respect of interest income earned on d interest income earned on deposits made with co-operative banks, operative banks, which had not been granted while processing the return. which had not been granted while processing the return. which had not been granted while processing the return.
5.2 However, the learned Assessing Officer rejected the said However, the learned Assessing Officer rejected the said However, the learned Assessing Officer rejected the said application, holding that the issue relating to the claim under application, holding that the issue relating to the claim under application, holding that the issue relating to the claim under Section 80P was under litigation under litigation and debatable, and therefore, did and debatable, and therefore, did not constitute a ‘mistake apparent from the record mistake apparent from the record’. The relevant mistake apparent from the record extract of the findings of the learned Assessing Officer reads as extract of the findings of the learned Assessing Officer reads as extract of the findings of the learned Assessing Officer reads as under:
“3. The assessee contention of the assessee is not acceptable as 3. The assessee contention of the assessee is not acceptable as 3. The assessee contention of the assessee is not acceptable as the issue u/s. 8 the issue u/s. 80P of the I.T. Act, 1961 is letigative as well as an 0P of the I.T. Act, 1961 is letigative as well as an debatable issue. Further, there is no evidence on record to prove debatable issue. Further, there is no evidence on record to prove debatable issue. Further, there is no evidence on record to prove that the assessee is eligible for the deduction u/s 80P. Moreover, that the assessee is eligible for the deduction u/s 80P. Moreover, that the assessee is eligible for the deduction u/s 80P. Moreover, concerned raised by the assessee of disallowance of deduction of concerned raised by the assessee of disallowance of deduction of concerned raised by the assessee of disallowance of deduction of Rs.15,46,811/ ,46,811/- u/s 80P of the Act is not the mistake apparent u/s 80P of the Act is not the mistake apparent
CCI Chambers Co-op. HSG. SOC. Ltd. CCI Chambers 10 & 3543/MUM/2025 & 3543/MUM/2025 from records. Hence, the request of the assessee to make requisite from records. Hence, the request of the assessee to make requisite from records. Hence, the request of the assessee to make requisite rectification u/s. 154 of the I.T. Act, 1961 is hereby rectification u/s. 154 of the I.T. Act, 1961 is hereby rejected. rejected.” 5.3 Aggrieved by the rejection, the assessee preferred an appeal Aggrieved by the rejection, the assessee preferred an appeal Aggrieved by the rejection, the assessee preferred an appeal before the Ld. CIT(A) Ld. CIT(A). The Ld. CIT(A) upheld the decision of the . The Ld. CIT(A) upheld the decision of the Assessing Officer, observing that the rectification jurisdiction under Assessing Officer, observing that the rectification jurisdiction under Assessing Officer, observing that the rectification jurisdiction under Section 154 is limited to correcting mistakes apparent from the Section 154 is limited to correcting mistakes apparent from the Section 154 is limited to correcting mistakes apparent from the record and does not extend to issues requiring debate or record and does not extend to issues requiring debate or record and does not extend to issues requiring debate or interpretation. The Ld. CIT(A) relied upon the binding decisions of interpretation. The Ld. CIT(A) relied upon the binding decisions of interpretation. The Ld. CIT(A) relied upon the binding decisions of Hon’ble Supreme Court in Court in T.S. Balaram, ITO v. Volkart Bros. T.S. Balaram, ITO v. Volkart Bros. [(1971) 82 ITR 50 (SC)] and CIT v. Keshri Metal Pvt. Ltd. CIT v. Keshri Metal Pvt. Ltd. [(1999) 237 ITR 165 [(1999) 237 ITR 165 (SC)], and held that no mistake apparent from the record was (SC)], and held that no mistake apparent from the (SC)], and held that no mistake apparent from the discernible in the intimation under Section 143(1) discernible in the intimation under Section 143(1) of the Act. The relevant finding of the Ld. CIT(A) is reproduced as under: relevant finding of the Ld. CIT(A) is reproduced as under: relevant finding of the Ld. CIT(A) is reproduced as under:
“11. The jurisdiction of an Assessing Officer to rectify an “11. The jurisdiction of an Assessing Officer to rectify an “11. The jurisdiction of an Assessing Officer to rectify an assessment order under section 154 of the Act is limited as assessment order under section 154 of the Act is limited as assessment order under section 154 of the Act is limited as he could make correction of errors apparent on the face of the he could make correction of errors apparent on the face of the he could make correction of errors apparent on the face of the record. In that regard I place reliance on the judgment of record. In that regard I place reliance on the judgment of record. In that regard I place reliance on the judgment of Hon'ble the Supreme Court in T.S. Balaram's ITO v. Volkart Hon'ble the Supreme Court in T.S. Balaram's ITO v. Volkart Hon'ble the Supreme Court in T.S. Balaram's ITO v. Volkart Bros. [1971] 82 ITR 50. Similar view has been reiterated in Bros. [1971] 82 ITR 50. Similar view has been reiterated in Bros. [1971] 82 ITR 50. Similar view has been reiterated in the case of CI the case of CIT v. Keshri Metal (P.) Ltd. [1999] 237 ITR 165 T v. Keshri Metal (P.) Ltd. [1999] 237 ITR 165 (SC). The order of intimation dated 03.03.2016 passed under (SC). The order of intimation dated 03.03.2016 passed under (SC). The order of intimation dated 03.03.2016 passed under section 143(1) of the Act, has attained finality as it appears section 143(1) of the Act, has attained finality as it appears section 143(1) of the Act, has attained finality as it appears that no appeal was filed against that order. I find no legal that no appeal was filed against that order. I find no legal that no appeal was filed against that order. I find no legal infirmity in the impugned infirmity in the impugned order u/s 154. Therefore, the order u/s 154. Therefore, the appeal fails and the same appeal fails and the same is dismissed.” 5.4 We have heard the rival submissions advanced by the parties We have heard the rival submissions advanced by the parties We have heard the rival submissions advanced by the parties and perused the material on record. The controversy that arises for and perused the material on record. The controversy that arises for and perused the material on record. The controversy that arises for our consideration is whether the rejection of the cl our consideration is whether the rejection of the claim of deduction aim of deduction under Section 80P(2)(d) of the Act in the intimation issued under under Section 80P(2)(d) of the Act in the intimation issued under under Section 80P(2)(d) of the Act in the intimation issued under CCI Chambers Co-op. HSG. SOC. Ltd. CCI Chambers 11 & 3543/MUM/2025 & 3543/MUM/2025 Section 143(1) amounts to a mistake apparent from the record so as Section 143(1) amounts to a mistake apparent from the record so as Section 143(1) amounts to a mistake apparent from the record so as to be rectifiable under Section 154 of the Act. to be rectifiable under Section 154 of the Act. On On examining the intimation under Section 143(1), it appea intimation under Section 143(1), it appears that the return was filed rs that the return was filed on 24.09.2015, whereas the due date as per the system-generated on 24.09.2015, whereas the due date as per the system on 24.09.2015, whereas the due date as per the system order is recorded as 07.09.2015. order is recorded as 07.09.2015. The belated filing of return of The belated filing of return of income may be one of the reason for adjustment u/s 143(1) of the income may be one of the reason for adjustment u/s 143(1) of the income may be one of the reason for adjustment u/s 143(1) of the Act, but the impugned intimation he impugned intimation does not clearly specify the does not clearly specify the grounds for disallowance of the claim grounds for disallowance of the claim of deduction of deduction under Section 80P(2)(d).
5.5 Upon careful perusal of the rectification order passed by the Upon careful perusal of the rectification order passed by the Upon careful perusal of the rectification order passed by the Assessing Officer, we find that the Assessing Officer has failed to Assessing Officer, we find that the Assessing Officer has failed to Assessing Officer, we find that the Assessing Officer has failed to record cogent or adequate reasons for rejecting the assessee’s adequate reasons for rejecting the assessee’s adequate reasons for rejecting the assessee’s application for rectification. It is not evident from record as under application for rectification. It is not evident from record as under application for rectification. It is not evident from record as under which sub clause of section 143(1)(a ) the adjustment has been which sub clause of section 143(1)(a ) the adjustment has been which sub clause of section 143(1)(a ) the adjustment has been made by the Central Processing centre(CPC), whether it sub the Central Processing centre(CPC), whether it sub-clause the Central Processing centre(CPC), whether it sub (ii) or sub-clause (v) of section 143(1)(a) of the Act. The Assess lause (v) of section 143(1)(a) of the Act. The Assessee lause (v) of section 143(1)(a) of the Act. The Assess presumed it to be under sub presumed it to be under sub-clause (ii) and accordingly requested clause (ii) and accordingly requested for rectification. The ld AO also proceeded to decide the issue for rectification. The ld AO also proceeded to decide the issue for rectification. The ld AO also proceeded to decide the issue accordingly. The order does not disclose any analytical discussion The order does not disclose any analytical discussion The order does not disclose any analytical discussion or reasoning as to how the claim of the assessee was considered to to how the claim of the assessee was considered to to how the claim of the assessee was considered to be litigative or debatable in nature. be litigative or debatable in nature. The learned Commissioner of The learned Commissioner of Income Tax (Appeals), in the appellate order, has merely affirmed Income Tax (Appeals), in the appellate order, has merely affirmed Income Tax (Appeals), in the appellate order, has merely affirmed the action of the Assessing Officer without undertaking an the action of the Assessing Officer without undertaking an the action of the Assessing Officer without undertaking an CCI Chambers Co-op. HSG. SOC. Ltd. CCI Chambers 12 & 3543/MUM/2025 & 3543/MUM/2025 independent examination or addressing the fundamental issue xamination or addressing the fundamental issue xamination or addressing the fundamental issue regarding the nature of the assessee’s claim. regarding the nature of the assessee’s claim.
5.6 Having regard to the aforesaid circumstances, we are of the Having regard to the aforesaid circumstances, we are of the Having regard to the aforesaid circumstances, we are of the considered view that the matter requires reconsideration at the level considered view that the matter requires reconsideration at the level considered view that the matter requires reconsideration at the level of the Assessing Officer. Acc of the Assessing Officer. Accordingly, the orders passed by the lower ordingly, the orders passed by the lower authorities are set aside, and the matter is restored to the file of the authorities are set aside, and the matter is restored to the file of the authorities are set aside, and the matter is restored to the file of the Assessing Officer with a direction to pass a reasoned and speaking Assessing Officer with a direction to pass a reasoned and speaking Assessing Officer with a direction to pass a reasoned and speaking order, after affording due opportunity of hearing to the assessee. order, after affording due opportunity of hearing to the assessee. order, after affording due opportunity of hearing to the assessee. The Assessing Officer shall specifically address the issue as to how ssing Officer shall specifically address the issue as to how ssing Officer shall specifically address the issue as to how the claim of the assessee is considered litigative or debatable, and the claim of the assessee is considered litigative or debatable, and the claim of the assessee is considered litigative or debatable, and shall also clearly indicate the precise sub shall also clearly indicate the precise sub-clause of Section 143(1)(a) clause of Section 143(1)(a) of the Act under which the adjustment has been made, whether it is of the Act under which the adjustment has been made, w of the Act under which the adjustment has been made, w under sub-clause (ii) or sub clause (ii) or sub-clause (v).
The grounds of appeal of the assessee are accordingly allowed for The grounds of appeal of the assessee are accordingly allowed for The grounds of appeal of the assessee are accordingly allowed for statistical purposes.
In the result, both the appeal In the result, both the appeals of the assessee are allowed for of the assessee are allowed for statistical purposes.