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Patul Ganesh Bazar Samabay Krishi… vs ITO | s.143(1), 139(1) | ITAT Kolkata 2025 | BharatTax

PATUL GANESH BAZAR SAMABAY KRISHI UNNAYAN SAMITY LTD.,HOOGHLY vs. ITO, WARD-24(1), HOOGHLY

ITA 481/KOL/2024Status: DisposedITAT Kolkata14 May 2025AY 2019-20Bench: SHRI RAJESH KUMAR (Accountant Member)4 pages

AI SummaryAllowed

Facts

A Primary Agricultural Credit Cooperative Society (assessee) filed its Income Tax Return for AY 2019-20 belatedly under Section 139(4), claiming a deduction under Section 80P. The CPC processed the return under Section 143(1) and rejected the Section 80P deduction, raising a demand, which was subsequently upheld by the Ld. CIT(A).

Held

The Tribunal held that the amendment to Section 143(1)(a)(v) allowing disallowance of Section 80P deduction for belated returns was introduced by Finance Act, 2021, effective from AY 2022-23. Therefore, for AY 2019-20, prior to this amendment, neither the CPC nor the Assessing Officer had the jurisdiction to deny the Section 80P deduction solely on the ground of late filing.

Key Issues

Whether the CPC or Assessing Officer had the jurisdiction to deny the deduction claimed under Section 80P for a belatedly filed return under Section 139(4) for Assessment Year 2019-20, under the provisions of Section 143(1), prior to the amendment by Finance Act, 2021.

Sections Cited

143(1), 139(1), 139(4), 80P, 143(1)(a), 143(1)(a)(v), 143(1)(a)(ii)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH, KOLKATA

Before: SHRI RAJESH KUMAR, AM Shri Soumitra Choudhry, AR

For Appellant: Shri Soumitra Choudhry, AR

For Respondent: Shri Madhumita Das, DR

Hearing: 17.04.2025Pronounced: 14.05.2025

This is an appeal preferred by the assessee against the order of the Commissioner of Income-tax (Appeals) ADDL/JCIT(A)-2, Mumbai (hereinafter referred to as the “Ld. CIT(A)”] dated 17.01.2024 for the AY 2019-20.

2.

The only ground pressed at the time of hearing is ground no.5, which is extracted as under:

5. For that on the facts of the case, that while issuing intimation u/s. 143(1) could not deny the claimed by the assessee as the same does not come within the ambit of 'an incorrect claim apparent from any information in the return', therefore, the disallowance made by the CPC was without jurisdiction, as such his finding is completely arbitrary, unjustified and illegal.

3.

The facts in brief are that the assessee is a Primary Agricultural Credit Cooperative Society (PACS) situated in remote village at Patul, District: Hooghly, West Bengal. The main object of the assessee is to

4.

Aggrieved by the said order ,the assessee preferred the appeal before the ld. CIT (A), however, the ld. CIT (A) affirmed the order dismissing the appeal of the assessee by holding that that the assessee has not filed the return of income within time allowed u/s 139(1) of the Act but filed the income tax return u/s 139(4) of the Act and therefore, assessee was not entitled to claim the deduction u/s 80P of the Act.

5.

5. I have heard the parties and perused the record placed before me. The solitary issue arises for my consideration is whether the CPC was justified in denying the deduction claimed by the assessee u/s.80P of the Act for filing the return belatedly. An amendment was brought in section 143(1)(a) of the Act by the Finance Act, 2021 w.e.f. 01.04.2021 giving powers to the CPC for disallowing the claim of deduction u/s.80P of the Act if return of income is not filed within the statutory time limit provided u/s.139(1) of the Act. However, prior to amendment, there was no mechanism for CPC to deny the deduction u/s.80P of the Act. Admittedly, the assessment year under consideration is 2018-19 whereas the amendment has been brought in from A.Y. 2021-22 and therefore the CPC erred in making the adjustment by way of disallowing deduction u/s.80 of the Act in the instant case. My view is fortified by the decision of Coordinate Bench of the Tribunal in the case of Finolex Industries Ltd. Employees Co-o. Credit Society Ltd. Vs. ITO in dated 03.04.2023 wherein the issue was decided in favour of the assessee by observing as under : “5. We have heard the submissions of the parties, considered the relevant materials/documents on record and analysed the facts and circumstances in this case. Section143(1)(a)(v) of the Act spells out that if any deduction is claimed under any of the provisions of Chapter VI-A which include deduction u/s 80P such deduction has to be allowed only if the return is filed within due date specified under sub-section 139(1) of the Act. In other words, if any return is filed beyond due date u/s 139(1) of the Act then no deduction u/s 80P shall be allowed. However, clause (v) was inserted by the Finance Act, 2021 w.e.f. 01-04-2021. The case of the assessee, on the other hand, is for F.Y. 2018- 19 relevant to A.Y. 2019-20 which is the period prior to amendment brought in by the Finance Act, 2021. Before this amendment, clause (v) did not include and cover deduction u/s 80P. So therefore, in the present Case of the assessee though admittedly return was filed beyond the time limit prescribed u/s 139(1) of the Act but still section 143(1)(a)(v) is not applicable to the assessee since the case of the assessee is for A.Y. 2019-20, which is before the amendment. We also accept the argument of the ld. A.R for the assessee that even if the revenue intends to invoke clause (ii) of section 143(1)(a) that would also not be permissible since in the definition of incorrect claim as provided in the provision, the deduction u/s 80P is not included anywhere and is therefore, outside the purview of the said provision. Therefore, rigors of provisions of section 143(1)(a)(ii) and clause (v) are not applicable to the case of the assessee. On this legal ground itself, the assessee succeeds and any other grounds on merits, if any, becomes academic in nature.