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Facts
The revenue appealed against an order by the CIT(A) for AY 2021-22, which deleted two additions made by the AO. The AO had assessed the income at Rs. 2,79,82,590/-, including a disallowance of deduction under Section 80P (Rs. 38,35,590/-) and an addition for unexplained credit (Rs. 2,41,46,999/-).
Held
The Tribunal noted that the revenue had only contested the deletion of Rs. 38,35,590/-, implying the deletion of Rs. 2,41,46,999/- was final. The tax on the amount in dispute was less than Rs. 60,00,000/-, making it dismissible in light of CBDT circular No. 09 of 2024.
Key Issues
Whether the deletion of additions made by the AO is sustainable, particularly the disallowance of deduction under Section 80P, considering the monetary limit for appeal as per CBDT circular.
Sections Cited
80P, 80P(2)(a), 80P(2)(d), 68, 144, 144B
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Before: SHRI SAKTIJIT DEY & SHRI NARENDRA KUMAR BILLAIYA
स िवाई की िारीख / Date of Hearing 05.06.2025 घोर्णा की िारीख/Date of Pronouncement 05.06.2025 आदेश / O R D E R PER NARENDRA KUMAR BILLAIYA [A.M.]:- This appeal by the revenue is preferred against the order dated 12.02.2025 by NFAC, Delhi [hereinafter referred to as “CIT(A)”] for Assessment Year [AY] 2021-22.
A.Y. 2021-22 Jankalyan Nagari Sahakari Patasanstha Marya Jawhar 2. The grievance of the revenue reads as under: “1. On the facts and in circumstances of the case and in law, the Ld. CIT(A) has erred in not appreciating the fact that the interest Income of the assessee society out of its "investment' with other co-operative banks is not eligible for deduction u/s. 80P(2)(a) as this interest income earned by the assessee society from Its investments with co- operative banks do not constitute operational Income or business income of the assessee society and should be taxed under the head "Income from other sources".
On the facts and in circumstances of the case and in law, the Ld. CIT(A) has erred in not appreciating the fact that the interest income earned by the assessee society cannot be held eligible for deduction u/s. 80P(2) (d) of the Act either as the section 80P(2)(d) specifies that the interest income earned by the co-operative societies from its investments with any other co-operative society would be eligible for deduction under the said section.
3. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in not allowing the A.O. to examine the additional”
It is pertinent to understand the assessment order dated 13.12.2022 framed u/s 144 r.w.s. 144B of the Income-tax Act, 1961 [hereinafter referred to as “Act”]. The returned income of the assessee was assessed at Rs. 2,79,82,590/- after making two additions (i) disallowance of deduction u/s 80P of the Act - Rs. 38,35,590/- (ii) addition u/s 68 in respect of unexplained credit – Rs. 2,41,46,999/-.
When the additions were agitated before the CIT(A), the CIT(A), vide order dated 12.04.2025, deleted both the additions.
A perusal of the grounds taken in appeal before us shows that the revenue has contested only the deletion of Rs. 38,35,590/-, which means that the deletion of Rs. 2,41,46,999/- has attained finality.
A.Y. 2021-22 Jankalyan Nagari Sahakari Patasanstha Marya Jawhar 6. The tax on Rs. 38,35,590/- would be less than Rs. 60,00,000/-. Therefore, this appeal by the revenue has to be dismissed in light of the CBDT circular No. 09 of 2024 dated 17.09.2024. 7. In the result, the appeal of the revenue is dismissed.
Order pronounced in the open court on 05.06.2025.