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Facts
The assessee filed an appeal against the order of the CIT(A) which upheld the disallowance of deduction under Section 80P. The appeal was filed with a delay of 135 days, attributed to a consultant's mistake.
Held
The Tribunal condoned the delay, finding the mistake bona fide and noting that supporting documents for the interest income were available. The order of the CIT(A) was set aside, and the matter was restored to the Assessing Officer for fresh verification of the claim.
Key Issues
Whether the delay in filing the appeal should be condoned? Whether the assessee is eligible for deduction under Section 80P(2)(a)(i) on interest income from a co-operative society?
Sections Cited
80P, 80P(2)(a)(i), 143(1)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘A’ BENCH, BANGALORE
Before: SHRI WASEEM AHMED & SHRI SOUNDARARAJAN K
PER WASEEM AHMED, ACCOUNTANT MEMBER:
This is an appeal filed by the assessee against the order passed by the Addl/JCIT(A)-1, Guwahati vide order dated 19/07/2024 in DIN No. ITBA/APL/S/250/2024-25/1066684920(1) for the assessment year 2021-22.
At the outset, we note that there is a delay of 135 days in filing the appeal before the Tribunal. The assessee has filed a condonation petition explaining the reasons for the delay. It was submitted that the office assistant of the tax consultant, who was handling the matter, went on examination leave without informing the status of the appeal. Later, the consultant got occupied with time-barred ROC work and annual return filings. When the office assistant resumed work in December, it was discovered that the appeal was not filed. The consultant immediately prepared and filed the appeal. However, in this process, the delay of 135 days has occurred.
The learned counsel also submitted that the assessee was denied deduction under section 80P of the Act in respect of interest income from a co-operative society. It was argued that this fact was clearly evident from the income statement and Form 26AS, but the learned CIT(A) inadvertently held that it was not clear whether the interest was from a co-operative society and dismissed the appeal. Accordingly, the ld. AR contended that the assessee has a strong case on merit and therefore the same should not be dismissed due to technical lapses.
The learned DR opposed condonation of delay and supported the order of the lower authorities. It was submitted that the assessee had already been granted several opportunities by the learned CIT(A) but failed to justify the claim.
We have heard both parties and perused the records. We note that the deduction under section 80P(2)(a)(i) of the Act was denied during processing under section 143(1) of the Act. The ld. CIT(A) upheld . the disallowance, stating that there was no evidence on record to show the interest income was from a co-operative society.
5.1 As regards the delay, the assessee explained that the appeal could not be filed due to the mistake of the consultant. While taxpayers are expected to be vigilant, we find that the mistake appears bona fide. More importantly, the income statement and Form 26AS placed on record do indicate the interest was from a co-operative society. It appears that the learned CIT(A) dismissed the appeal without verifying these documents. The revenue also failed to examine the available records. Accordingly, we hold that the mistake has not only been committed by the assessee by not filing the appeal within the stipulated time but the ld. CIT-A also failed to verify the records properly which are available before him. Hence, considering all the facts available on record, we are of the view that the balance of convenience lies in favour of the assessee. Accordingly, we condone the delay in filing the appeal.
5.2 Regarding merit, we set aside the order of the ld. CIT(A) and restore the matter to the file of the Assessing Officer. The AO is directed to verify the claim of deduction under section 80P(2)(a)(i) of the Act in respect of alleged interest from co-operative societies and decide the issue afresh in accordance with law. The assessee shall fully cooperate in the proceedings before the AO and shall furnish all necessary evidence. The AO shall provide proper opportunity to the assessee. Hence, the ground of appeal of the assessee is allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes.