M/S. S. 172 SAMUDRAM PACCS LTD.,SALEM vs. ITO WARD-2(2), SALEM

There is a delay of six days for filing the appeal. The Assessee has filed an Affidavit. We have gone through the Affidavit and we find that there is sufficient cause to condone the delay. Accordingly, the delay is condoned.

So far as the merits of the case is concerned, the Assessing Officer has denied the claim of the Assessee u/s.80P(2)(a)(i) of the Income Tax Act, 1961. Subsequently, the Assessee has filed an application u/s.154 of the Income Tax Act, 1961 for the very same claim. The same is dismissed by the Assessing Officer on the ground that there is no mistake apparent on record.

On appeal, the learned Commissioner of Income Tax (Appeals) confirmed the order of the Assessing Officer by observing as under: “6. It is seen that the Assessee sought to get its claim of deduction u/s.80P(2)(a)(i) of the Income Tax Act, 1961 allowed by filing an appeal u/s.154. The claim of deduction u/s.80P was disallowed on the ground that the appellant society has involved in commercial activities of banking and trading and not involved in connection with agricultural purpose or for the purpose connected with agricultural activities. 6.1. The other reason which resulted in the denial of deduction u/s.80P(2)(a)(i) by the Assessing Officer was that the loans are issued to associate members that they are not entitled to receive any dividend and are not having any voting right and to participate in the general administration and to attend any meeting, etc., that they are admitted for availing loan only and that subsequently on discharging their loan liability, they do not have any role to play in the society. 6.2. As it can be seen the issues involved are complex and debatable. These issues cannot be rectified u/s.154. In order to attract the application of section 154, it must be a case of mistake and the mistake must be apparent from the record. The mistake should be obvious, clear and patent and should not involve two opinions. There are many litigations and debate going on about the allowance or otherwise u/s.80P(2)(a)(i). Hence, it being a debatable issue cannot be considered u/s.154 of the Income Tax Act, 1961. Thus, the AO has correctly rejected the Assessee’s applications and the same does not call for any interference. Therefore, all the grounds of appeals are dismissed.”

The learned Commissioner of Income Tax (Appeals) by considering the entire facts of the case dismissed the appeal of the Assessee.

We find no conformity in the order passed by the learned Commissioner of Income Tax (Appeals) and therefore the appeal filed by the Assessee is dismissed.

In the result, the appeal filed by the Assessee in I.T.A.No.1453/Chny/2019 is dismissed.