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Facts
The assessee, a Primary Agricultural Co-operative Credit Society, filed its Return of Income for AY 2018-19 claiming set-off of brought forward losses. The CPC denied this set-off, and the First Appellate Authority (FAA) further rejected the assessee's new claim for deduction under Section 80P, made during the appellate proceedings, on the grounds that it was not included in the original return of income.
Held
The Tribunal, relying on the Madras High Court's interpretation of the Goetze (India) Ltd. judgment, held that an appellate authority can entertain new claims not made in the original ROI. It ruled that the FAA was not justified in rejecting the assessee's claim under Section 80P and restored the matter to the Assessing Officer for a fresh examination of the assessee's entitlement to this deduction.
Key Issues
Whether the First Appellate Authority was justified in not entertaining a new claim for deduction under Section 80P that was not part of the original Return of Income, and whether the assessee is entitled to such a deduction.
Sections Cited
250, 80P, 143(1), 139(1), 80, 139(3), 80P(2)(a)(i)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, ‘B’ (SMC
Before: SHRI GEORGE GEORGE K
आदेश/ O R D E R
This appeal filed by the assessee is directed against the order of Addl / JCIT(A)-3, Mumbai dated 23.10.2024 passed under section 250 of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The relevant Assessment Year is 2018-19.
Brief facts of the case are as follows: The assessee is a Primary Agricultural Co-operative Credit Society registered under the TamilNadu Co-operative Societies Act, 1983. It is engaged in the business of providing credit facilities to its members. For the assessment year 2018-19, return of income (ROI) was filed on 24.07.2018 (within the due date specified) claiming set-off of carry forward losses. Intimation u/s.143(1) of the Act was issued by the Central Processing Centre (CPC), Bangalore on 31.05.2019, wherein the assessee’s claim of set-off was denied for the reason that for the earlier years in which loss has been computed (loss computed for assessment year 2017-18), assessee had not filed its ROI within the due date specified.
Aggrieved by the intimation issued u/s.143(1) of the Act, assessee preferred appeal before the First Appellate Authority (FAA). Before the FAA, the assessee by placing reliance on the judgment of Hon’ble Supreme Court in the case of Mavilayi Service Co-operative Bank Ltd., vs. CIT reported in [2021] 431 3 -: ITR 1 (SC), submitted that assessee is entitled to deduction u/s.80P(2)(a)(i) of the Act. The FAA however, rejected the assessee’s claim of deduction u/s.80P(2)(a)(i) of the Act since assessee had not made the claim in the return filed and hence, held that there is no mistake in the order of the intimation passed by the CPC, Bangalore.
Aggrieved by the order of the FAA, assessee has filed the present appeal before the Tribunal. The assessee reiterated the submissions made before the FAA.
The Ld.DR has filed brief written submissions dated 07.05.2025 and 02.06.2025. The content of the same is that assessee had not made the claim of deduction u/s.80P of the Act and in light of the judgment of Hon’ble Apex Court in the case of Goetze (India) Ltd., vs. CIT reported in [2006] 284 ITR 323 (SC), the AO cannot entertain a new claim which is not made in the ROI.
I have heard rival submissions and perused the material on record. The assessee for the relevant assessment year 2018-19 had declared ‘nil’ income after claiming set-off of brought forward losses of Rs.2,37,001/-. The CPC processed the return filed 4 -: u/s.139(1) of the Act and issued intimation u/s.143(1) of the Act dated 31.05.2019. The CPC disallowed the set-off of brought forward losses as the return for the earlier assessment year namely 2017-18 was filed beyond the due date prescribed rendering the losses ineligible for carry forward u/s.80 r.w.s.139(3) of the Act. The FAA dismissed the appeal of the assessee stating that assessee never made the claim of deduction u/s.80P(2)(a)(i) of the Act in its return filed for the relevant assessment year.
The Hon’ble Madras High Court in the case of CIT vs. Abhinitha Foundation (P) Ltd., reported in [2017] 396 ITR 251 (Madras) considered the judgment of Hon’ble Supreme Court in the case of Goetze (India) Ltd., (supra). The Hon’ble High Court after quoting the relevant part of Hon’ble Supreme Court judgment in the case of Goetze (India) Ltd., held that power to consider a new claim not claimed in ROI does not impinge the power of appellate authority. In the instant case, admittedly assessee had claimed deduction u/s.80P of the Act before the FAA. In light of the judgment of the Hon’ble Jurisdictional High Court cited supra, the FAA is not justified in not entertaining the claim of deduction u/s.80P of the Act. On the facts of the instant 5 -: case, assessee had filed the return of income for the relevant assessment year within the due date prescribed. The assessee being a primary agricultural co-operative credit society would be entitled to deduction u/s.80P of the Act provided conditions mentioned therein are satisfied. Since the claim of deduction has not been examined by the AO, I restore the matter to the files of the AO to examine whether the assessee is entitled to claim of deduction u/s.80P of the Act. It is ordered accordingly.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 3rd July, 2025 at Chennai.