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Facts
The assessee, a co-operative society, filed its return for AY 2020-21 declaring Nil income after claiming deduction u/s. 80P. The AO denied the deduction based on the late filing of the return, disallowed expenditure u/s. 40(a)(ia), and contingency expenses.
Held
The Tribunal held that the co-operative society's claim for deduction u/s. 80P was correctly disallowed as the return was not filed within the due date prescribed u/s. 139(1), as mandated by section 80AC. The ground related to contingency expenses was dismissed as it was raised for the first time before the Tribunal.
Key Issues
Disallowance of deduction u/s. 80P and disallowance of contingency expenses.
Sections Cited
139(1), 80P, 80AC, 40(a)(ia), 147, 144, 148A
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Income Tax Appellate Tribunal, COCHIN BENCH
Before: SHRI INTURI RAMA RAO, AM & SHRI MANU KUMAR GIRI, JM
O R D E R Per: Inturi Rama Rao, AM This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre, Delhi (NFAC) dated 14.07.2025 for Assessment Year (AY) 2020-21.
Brief facts of the case are that the appellant is a co-operative society registered under the Kerala State Co-operative Societies Act, 1969. It is formed with the object of providing credit facilities to members and accepting deposits from its members. No regular Veliyanad co-operative society Ltd. return of income was filed u/s. 139(1) of the Income Tax Act, 1961 (the Act) by the appellant for AY 2020-21. The Assessment Unit, Income Tax Department (hereinafter called "the AO"), based on the information that the appellant made cash deposits in the bank account, earned commission income and made investments in fixed deposit, formed an opinion that income escaped assessment to tax. Accordingly, a notice u/s. 148A of the Act was issued. Subsequently, order u/s. 148A(d) was passed on 25.03.2024. Notice u/s. 148 was issued on 26.03.2024. In response to the notice u/s. 148, the appellant society had filed return of income for AY 2020- 21 on 26.06.2024 declaring Nil income after claiming deduction u/s. 80P of the Act at Rs. 68,70,900/-. Against the said return of income, the assessment was completed by the AO vide order dated 14.02.2024 [passed u/s. 147 r.w.s. 144 of the Act at a total income of Rs. 90,47,390/-. While doing so, the AO had denied deduction u/s. 80P of the Act on the ground that no return of income was filed within the due date prescribed u/s. 139(1) of the Act, placing reliance on provisions of section 80AC of the Act. Further, the AO made disallowance of expenditure invoking section 40(a)(ia) of the Act of Rs. 2,16,838/- and made disallowance of contingency expenses of Rs. 19,59,652/-.
Being aggrieved, an appeal was filed before the CIT(A), who vide the impugned order partly allowed the appeal by confirming the
Being aggrieved, the appellant is in appeal before this Tribunal in the present appeal challenging the disallowance of deduction u/s. 80P as well as disallowance of contingency expenses.
We do not find any merit in the grounds of appeal, challenging the disallowance of claim for deduction u/s. 80P as the appellant had not filed the return of income, within the due date prescribed u/s. 139(1) of the Act. The provisions of section 80AC mandates that in order to avail deduction u/s. 80P, the return of income should be filed by the co-operative societies within the due date prescribed u/s. 139(1) of the Act. Thus, we do not find any reason to interfere with the action of the learned lower authorities confirming the disallowance of claim for deduction u/s. 80P of the Act.
Next ground of appeal challenges the disallowance of contingency expenses of Rs. 19,59,6523/-. This ground of appeal was raised for the first time before this Tribunal. This ground was not challenged before the NFAC. No application was filed for admission of additional ground of appeal. In the circumstances this ground of appeal cannot be admitted. Accordingly this ground is dismissed.
Order pronounced in the open court on 6th November, 2025.