MALAY KARJEE, INCOME TAX OFFICER, WARD-38(1), MIDNAPUR, MIDNAPUR vs. KURKUTBANDHI SKUS LTD., KURKUTBANDHI

The Revenue has raised following grounds of appeal: -

The issue raised in ground no.2 is against the order of learned CIT (A) deleting the disallowance of ₹24,30,594/- as made by the learned AO by disallowing the deduction u/s 80P of the Act on the ground that there was no material information found indicating any income derived by the assessee by providing loans / credit facilities to its member.

The facts in brief are that the learned AO found during the course of assessment proceedings that the assessee is engaged in the activity of accepting deposits under various schemes and also giving loans against such deposits to non-members also. Therefore, the learned AO held that the activity of the society is that of finance business and accordingly held the assessee to be not eligible for

In the appellate proceedings, the learned CIT (A) allowed the appeal of the assessee after calling for the remand report from the AO and after taking into account the submission and contention of the assessee by observing and holding as under: - “The assessee did not comply with the notices issued by the Ld. AO. Hence, the assessment was completed u/s 144 of the Act. The Ld. AO made a disallowance of Rs.24,30,594/- u/s 80P of the Act. The appellant filed additional evidence during the course of appellate proceedings which were forwarded to the Ld. AO for his comments. The remand report as received from the Ld. AO has been perused. The Ld. AO after examining all the documentary evidence submitted by the appellant has submitted that there was no material information found indicating any income derived by the assessee by providing loans/credit facilities to its non-members.”

After hearing the rival contentions and perusing the materials available on record including appellate order and the remand report and rejoinder filed by the assessee, we do not find any infirmity in the order of the learned CIT (A) accordingly, ground no.2 is dismissed by upholding the order of learned CIT (A) on this issue.

The issue raised in ground no.3 is against the deletion of addition of ₹2,15,53,700/- as made by the learned AO for unexplained cash deposit u/s 69A of the Act on the ground that day book and cash

The fact in brief are that the learned AO during the course of assessment proceedings found that the assessee has deposited cash into the bank account of ₹2,15,53,700/- during the demonetization period and accordingly, notice was issued which was not complied with by the assessee. Consequently, the learned AO added the said amount u/s 69A of the Act to the income of the assessee as unexplained money.

In the appellate proceedings, the learned CIT (A) called for the remand report from the learned AO on the evidences filed by the assessee which was duly submitted before the learned CIT (A) and the learned CIT (A) dealt with the said remand report in para no.5 of page no.19 of the appellate order. The learned CIT (A) after taking into account the submission of the assessee and evidences filed including the remand report deleted the addition by observing and holding as under: -

The facts in brief are that the learned AO during the course of assessment proceedings observed that the assessee has charged to the profit and loss account the provisions for overdue interest of ₹24624/-. When the assessee did not reply, the learned AO added the same to the return income of the assessee.

In the appellate proceedings, the assessee explained the nature of said interest and the learned CIT (A) recorded a finding that the provision for overdue interest has been made as per Income-tax Act, 1961 (the Act) by the assessee and there is no reason for the same to be added back and hence, the learned CIT (A) allowed the appeal of the assessee. Since there is no infirmity in the order of the learned

In the result, the appeal of the Revenue is dismissed.