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Facts
The appellant, a co-operative society claiming to be a primary agricultural credit society, did not file an original return for AY 2012-2013. After a Section 148 notice, it filed a return claiming deduction u/s. 80P, which the AO denied, classifying it as a co-operative bank and asserting a failure to prove its status as a primary agricultural credit society. The CIT(A) upheld the AO's decision.
Held
The Tribunal condoned the 377-day delay in filing the appeal. It remitted the matter back to the Assessing Officer for fresh adjudication, directing the appellant to provide further evidence to establish its status as a primary agricultural credit society, especially in light of an old RBI certificate which the CIT(A) deemed insufficient.
Key Issues
Whether the appellant is entitled to deduction under Section 80P as a primary agricultural credit society, and if the AO was justified in denying it by classifying it as a co-operative bank.
Sections Cited
139(1), 148, 80P, 143(3), 147, 80P(4), 250, 80P(2)(a)(i)
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Income Tax Appellate Tribunal, “SMC” BENCH, COCHIN
Before: Shri Inturi Rama Rao
Asst.Year 2012-2013 Ayyanthole Panchayath Service The Income Tax Officer Co-operative Bank Ltd.No.471 v. Ward 2(1), Kariyattukara PO Thrissur. Thrissur – 680 611 PAN : AACAA3641G. (Appellant) (Respondent) Appellant by : Sri.Alan Dev, Advocate Respondent by : Smt.Leena Lal, Sr.AR Date of Date of Hearing : 26.03.2025 Pronouncement : 08.04.2025 O R D E R This appeal filed by the assessee is directed against the order of the National Faceless Assessment Centre / Commissioner of Income- tax (Appeals) [“CIT(A)” for short] dated 22.12.2023 for the assessment year 2012-2013.
The brief facts of the case are that the appellant is a co-operative society duly registered under the Kerala Co-operative Societies Act, 1969. The appellant is classified as a primary agricultural credit society. No regular return of income u/s.139(1) of the Income-tax Act, 1961 (“the Act”) for the assessment year 2012-2013 was filed by the appellant. Subsequently, the Assessing Officer (“the AO”) issued a notice u/s.148 of the Act on 29th March, 2019 calling upon the appellant to file the return of income. In response to the notice u/s.148 of the Act, the appellant filed the return of income on 9th August, 2019 declaring . Ayyanthole Panchayath SC.B Ltd. Nil income after claiming deduction u/s.80P of the Act amounting to Rs.40,98,500. Against the said return of income, the assessment was completed by the AO vide order dated 12th December, 2019 passed u/s.143(3) r.w.s. 147 of the Act at a total income of Rs.40,98,500 denying the claim for deduction u/s.80P of the Act by observing that the appellant is a co-operative bank and therefore hit by the provisions of sub-section (4) of the section 80P of the Act and also holding that the appellant has not discharged the onus of proving it to be a primary agricultural co-operative credit society.
Being aggrieved by the above assessment order, an appeal was filed before the CIT(A), who vide the impugned order allowed standard deduction to sec.80P of the Act and confirmed the action of the AO in denying the claim for deduction u/s.80P of the Act.
Being aggrieved, the appellant is in appeal before me in the present appeal. At the outset, there is a delay in filing the present appeal by 377 days. The appellant filed a condonation petition seeking condonation of delay on the ground that the appellant was not aware of the order passed by the CIT(A) u/s.250 of the Act. It had come to the knowledge, only after the receipt of the consequential order passed by the CIT(A) vide email dated 23rd January, 2024. Thus, he submitted that the appellant was not aware of the order passed by the CIT(A) till the passing of the consequential order to the CIT(A) order. Thus, it is submitted that the delay had occurred on account of factors which are beyond its control. In the absence of evidence to the contrary the averments made in the affidavit seeking condonation of delay cannot be
I heard the rival submissions and perused the material available on record. The only issue that arises for my consideration is whether the AO is justified in rejecting the claim of deduction u/s.80P(2)(a)(i) of the Act. The AO as well as the CIT(A) had denied the claim for deduction u/s.80P(2)(a)(i) of the Act for the failure of the assessee to discharge the onus of proving that it is a primary agricultural credit society. During the course of proceedings before the CIT(A), the appellant has filed certificate issued by the Reserve Bank of India in the year 1943 classifying the appellant society as a primary agricultural credit society. However, the CIT(A) on considering the said certificate held that since it is very old one, the appellant cannot be granted deduction u/s.80P of the Act. Therefore, in view of the settled position of law that in the absence of license to carry on the business of banking the appellant cannot be classified as a co-operative bank, I remit the matter back to the file of the AO for fresh adjudication with a direction that the appellant shall adduce evidence to prove that the appellant is a primary agricultural credit society.
In the result, the appeal filed by the assessee is partly allowed. Order pronounced on this 08th day of April, 2025.