KADAVATHUR SERVICE CO-OPERATIVE BANK LTD,KANNUR vs. ITO, WARD 2, KANNUR

Since identical facts and issues involve in all these appeals, appeals heard together and disposed of vide this common order.

Brief facts of the case are that appellant is a cooperative society registered under Kerala Co-operative Societies Act, 1969. It is classified as primary agricultural credit cooperative society. It is engaged in the business of accepting deposits from members and providing credit facilities to its members. The return of income for the A.Y. 2017-18 was filed on 10/02/2018 declaring nil income after claiming deduction u/s. 80P(2)(a)(i) of the Income Tax Act, 1961 (for short, 'the Act'). Against the said return of income, the assessment was completed by the ITO, Ward-2, Kannur (for short, 'AO') vide order dated 21/12/2019 passed u/s. 143(3) of the Act at a total income of Rs. 39,24,900/-. While doing so, the AO had denied the claim of deduction u/s. 80P(2)(a)(i) by holding that the appellant is a cooperative bank hit by the provisions of section 80P(4) of the Act.

Being aggrieved by the order of the AO, an appeal was filed before the CIT(A), who vide the impugned order partly allowed the appeal directing the AO to tax the income earned by the appellant society out of loans given to non-members.

Being aggrieved, the assessee is in appeal before the Tribunal in the present appeal.

At the outset, we find that there is a delay of 415 days in filing the present appeal. The appellant filed a petition seeking to 461/Coch/2025 Kadavathur Service Co-op. Bank Ltd. condonation of delay on the ground that appellant is pursuing alternative remedy by filing section 154 petition before the learned CIT(A). Since the learned CIT(A) had not passed any order pursuant to the rectification petition, immediately appeal was filed. Thus, it was submitted that the delay had occurred and, therefore, the delay may be condoned.

We have carefully gone through the averments made in the affidavit seeking condonation of delay. Admittedly, the appellant society received the order u/s. 250 passed by the NFAC on 30/04/2024, whereas rectification application before the learned CIT(A) was filed on 12/03/2025 i.e. nearly after lapse of a period of one year. Furthermore, the appellant had not waited for outcome of the rectification application filed before the learned CIT(A). In these circumstances, we are not convinced with the explanation offered by the appellant that delay had occurred on account of pursuit of alternative remedy. Therefore, the appellant is guilty of negligence. We do not find the explanation offered by the appellant is bonafide and it is not a fit case to condone the delay of 359 days in filing the present appeal. Even on merits also, we do not find any merit since the learned CIT(A) following the judgment of Hon'ble Supreme Court in the case of Mavilayi Service Co-operative Bank Ltd. vs CIT (431 ITR 01) held that income earned by the appellant society from non-members on loans made to them should be brought to tax. Thus, the appeal filed by the assessee stands dismissed.

In the result, appeal filed by the assessee stands dismissed.

In the result, all the appeals filed by the assessee stand dismissed.