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Facts
The assessee filed an appeal against the order confirming the action of CPC in disallowing deduction under Section 80P for AY 2018-19 due to delayed return filing. There was a significant delay in filing the appeal before the CIT(A), which was attributed to pursuing alternate remedies and the COVID-19 pandemic.
Held
The Tribunal condoned the delay in filing the appeal before the CIT(A) by holding that the assessee had reasonable cause and no intention to delay. The Tribunal further held that the CPC had exceeded its jurisdiction in making the prima facie adjustment denying deduction under Section 80P, as the powers for such disallowance due to delayed return filing were granted to the CPC only from April 1, 2021.
Key Issues
Whether the delay in filing the appeal before CIT(A) should be condoned? Whether CPC had the jurisdiction to disallow deduction u/s 80P for AY 2018-19 for delayed filing of return?
Sections Cited
250, 143(1), 143(1)(a), 80P, 154, 139(1), 80AC, 143(1)(a)(v), 10AA, VI-A
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Income Tax Appellate Tribunal, PUNE BENCHES “SMC”, PUNE
Before: DR.MANISH BORAD
आदेश / ORDER
This appeal filed at the instance of assessee pertaining to the Assessment Year 2018-19 is directed against the order dated 06.12.2024 of ADDL/JCIT(A)-2, Noida passed u/s.250 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) arising out of the Intimation Order dated 31.05.2019 passed u/s.143(1) of the Act.
The only grievance of the assessee is that ld. CIT(A) erred in confirming the action of CPC of making prima facie adjustment u/s. 143(1)(a) of the Act disallowing deduction u/s. 80P of the Act even though such powers were given to the CPC from 01.04.2021 onwards.
At the outset, Ld. Counsel for the asssessee submitted that Ld. CIT(A) dismissed appeal for non-compliance. There was delay of 259 days in filing the appeal before ld.CIT(A) which was on account of following reasons which are mentioned in the affidavit placed on record and the same reads as follows :
“5. The Society filed a request for rectification on 18.06.2019 which was rejected on 19.06.2019 on the ground that the case has been transferred to Jurisdictional Assessing Officer. The Society thereafter filed application u/s 154 with Jurisdictional Assessing Officer on 04.02.2021. The same was pending and no decision or order was passed. Since the rectification application was not decided, the Society was advised to file appeal against the Intimation u/s 143(1) dated 31.05.2019. The appeal before CIT(A) was filed 03.11.2022.
6. The appeal before CIT(A) was filed with delay of 259 days upto 15th March 2020. The Supreme Court in its sue moto order has excluded the period upto 28th February 2022 considering the COVID Spread across the nation. The period from 01.03.2022 upto 03.11.2022 comprising the 248 days are further added to the delay in filing appeal before CIT(A). The total delay therefore is 507 days.
The above period of delay was occurred to alternate remedy u/s 154 being pursued by the Society. It is submitted that the delay is for reasons beyond the control of the Society and there was no intention to delay the filing of appeal within the statutory time. In the interest of justice, the delay in filing appeal may kindly be condoned and the appeal may please be considered on merits.”
She further submitted that since there is a reasonable cause Ld. CIT(A) ought to have condoned the delay. Even otherwise, the CPC has erred in making prima-facie adjustment denying deduction u/s.80P of the Act for the A.Y. 2018-19 inspite of the fact that such powers have been given to the CPC by Finance Act, 2021 effective from 01.04.2021. In support, she placed reliance on the decision of Lucknow Bench in the case of Sahakari Ganna Vikas Samiti Ltd. V. ACIT (2024) 169 taxmann.com 300 (Lucknow- Trib.) and the decision of Rajkot Bench in the case of Chakargadh Seva Sahakari Mandali Ltd.V. DCIT (CPC) (2021) 154 taxmann.com 228 (Rajkot – Trib.).
On the other hand, Ld. Departmental Representative supported the orders of the lower authorities.
I have heard the rival contentions and perused the record placed before me. I observe that the assessee has claimed deduction u/s.80P of the Act for A.Y. 2018-19 on Rs.13,56,442/- in the return of income furnished on 14.11.2018. Since the return was filed belatedly CPC denied the claim applying section 80AC of the Act. Assessee preferred appeal before ld. CIT(A) but there was considerable delay before him. Ld. Counsel for the Assessee with the support of affidavit and reasons mentioned (supra) has successfully explained the cause of delay and in my considered view the delay in filing of the appeal before CIT(A) deserves to be condoned. I therefore condone the delay and admit the appeal for adjudication.
7. So far as merits of the case are concerned, the only grievance is of the assessee is on the denial of benefit of deduction u/s.80P of the Act. In the instant case CPC has made prima-facie adjustment by denying deduction on the ground that return of income was not filed within the stipulated time limit provided u/s 139(1) of the Act, section 80AC of the Act is invoked. On perusal of section 143(1)(a)(v) of the Act, I observe that by Finance Act 2021 effective from 01.4.2021 powers have given to the CPC to make disallowance of deduction claimed under sections 10AA or under any of the provisions of Chapter VI-A under the heading ‘C” – deduction in respect of certain incomes, if the return is furnished beyond the due date specified under sub-section (1) of section 139; Prior to 01.04.2021, there were no powers u/s.143(1)(a) of the Act for making such prima-facie adjustment denying deduction u/s.80P of the Act for delay in filing return of income. Since CPC has exceeded the jurisdiction in my view the impugned disallowance is uncalled for. My view is fortified by the decisions relied on by the ld. Counsel for the assessee which have been cited (supra). Impugned order is set aside and effective grounds of appeal raised by the assessee are allowed.
In the result, appeal of the assessee is allowed.
Order pronounced on this 30th day of June, 2025.