BHAGDESHWAR NAGARI SAHAKARI PATSANSTHA MARYADIT,PUNE vs. ITO WARD 10(1), PUNE

There is a delay of 368 days in filing of this appeal before the Tribunal for which the assessee has filed a condonation application along with an affidavit explaining the reasons for such delay. It has been explained that the staff could not check the e-mail for which the order of the Ld. CIT(A) / NFAC remained unnoticed. Relying on various decisions the Ld. Counsel for the assessee submitted that the delay in filing of the appeal should be condoned.

The Ld. DR on the other hand strongly opposed the condonation application filed by the assessee.

I have heard the rival arguments made by both the sides on the issue of delay in filing of the appeal and considered the contents of the condonation application filed along with the affidavit of the assessee.

I find the Hon'ble Supreme Court in the case of Collector, Land Acquisition vs. Mst. Katiji & Ors. reported in 167 ITR 471 (SC) has held that when substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this when delay is condoned the highest that can happen is that a cause would be decided on merits after hearing the parties.

I find recently the Hon’ble Supreme Court in the case of Inder Singh Vs. The State of Madhya Pradesh reported in 2025 LiveLaw (SC) 339 has held as under: “14. There can be no quarrel on the settled principle of law that delay cannot be condoned without sufficient cause, but a major aspect which has to be kept in mind is that, if in a particular case, the merits have to be examined, it should not be scuttled merely on the basis of limitation.”

Considering the totality of the facts of the case and in the light of the decisions of Hon’ble Supreme Court cited (supra), the delay in filing of the appeal is condoned and the appeal is admitted for adjudication.

Although a number of grounds have been raised by the assessee, however, these all relate to the ex-parte order of the Ld. CIT(A) / NFAC confirming the disallowance of deduction of Rs.30,14,289/- made by the Assessing Officer u/s 80P of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’).

Facts of the case, in brief, are that the assessee is a co-operative society registered under Maharashtra Co-operative Societies Act, 1960. It filed its return of income for the impugned assessment year declaring total income of Rs.98,960/- after claiming deduction of Rs.30,14,289/- u/s 80P of the Act. The case was selected for limited scrutiny. During the course of assessment proceedings the Assessing Officer noted that the assessee has claimed deduction u/s 80P of the Act, the details of which are as under: (i) Deduction u/s 80P(2)(a)(i) - Rs.8,82,229/- (ii) Deduction u/s 80P(2)(d) - Rs.20,82,060/- (iii) Deduction u/s 80P(2)(c)(ii) - Rs.50,000/-

According to the Assessing Officer the assessee society is not entitled for deduction u/s 80P(2)(a)(i) of the Act for the credit facilities provided in absence of full details. Further, the interest received from investment has to be treated as income from other sources and is not entitled for deduction u/s 80P(2)(d) in view of the decision of Hon’ble Karnataka High Court in the case of PCIT vs. The Totagars Co-operative Sale Society. Relying on various decisions, the Assessing Officer rejected the claim of deduction u/s 80P of the Act and made addition of Rs.30,14,289/- to the total income of the assessee. He accordingly determined the total income of the assessee at Rs.31,13,250/-

Since the assessee did not respond to any of the 5 opportunities granted by the Ld. CIT(A) / NFAC, the Ld. CIT(A) / NFAC upheld the action of the Assessing Officer by observing as under:

Aggrieved with such order of Ld. CIT(A) / NFAC, the assessee is in appeal before the Tribunal.

The Ld. Counsel for the assessee relying on various decisions submitted that the issue stands decided in favour of the assessee. He accordingly submitted that instead of setting aside the issue to the file of the Ld. CIT(A) / NFAC, the appeal should be decided by the Tribunal in favour of the assessee.

The Ld. DR on the other hand submitted that despite 5 opportunities granted by the Ld. CIT(A) / NFAC, the assessee never bothered to make any submission distinguishing the various decisions relied on by the Assessing Officer. Therefore, the order of the Ld. CIT(A) / NFAC be upheld. Alternately he submitted that the matter may be restored to the file of the Ld. CIT(A) / NFAC.

I have heard the rival arguments made by both the sides and perused the orders of the Assessing Officer and Ld. CIT(A) / NFAC. I find the Assessing Officer, rejecting the various submissions made by the assessee, disallowed the claim of deduction of Rs.30,14,289/- u/s 80P of the Act. Since the assessee despite 5 opportunities granted by the Ld. CIT(A) / NFAC, did not make any submission to controvert the findings of the Assessing Officer, the Ld. CIT(A) / NFAC upheld the action of the Assessing Officer. It is the submission of the Ld. Counsel for the assessee that the issue stands decided in favour of the assessee by various decisions of the Co-ordinate Bench of the Tribunal. Since the assessee despite 5 opportunities granted by the Ld. CIT(A) / NFAC has not made any submission before him, therefore, considering the totality of the facts of the case and in the interest of justice, I deem it proper to restore the issue to the file of the Ld. CIT(A)/NFAC with a direction to grant one final opportunity to the assessee to substantiate its case by filing the requisite details and decide the issue as per fact and law. The assessee is also hereby directed to appear before the Ld. CIT(A) / NFAC on the appointed date and make its submissions, if any, without seeking any adjournment under any pretext failing which the Ld. CIT(A) / NFAC is at liberty to pass appropriate order as per law. I hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes.

In the result, the appeal filed by the assessee is allowed for statistical purposes.