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Income Tax Appellate Tribunal, AHMEDABAD “SMC” BENCH
Before: Shri Waseem Ahmed & Shri Siddhartha Nautiyal
आदेश/ORDER PER : SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER:-
These two appeals filed by the assessee against the order of National Faceless Appeal Centre (NFAC), Delhi in DIN & Order Nos. ITBA/NFAC/S/250/2021-22/1035816546(1) & ITBA/NFAC/S/250/2021- 22/1036072524(1) vide order dated 23/09/2021 & 30-09-2021 passed for the assessment years 2018-19 & 2019-20.
Since common issues are involved in both the appeals, the same are being heard together.
I.T.A Nos. 313 & 314/Ahd/2021 A.Y. 2018-19 & 2019-20 Page No. 2 Muncipal Servant Co. Op Credit & Supply Society Ltd. vs. DCIT
The assessee has taken the following grounds of appeal:
AY 2018-19
“1. The assessment order passed u/s 143(1) of IT Act by the Assessing Officer and confirmed by the first appellate authority u/s 250 is bad in law and deserved to be uncalled for
The assessing officer as well as first appellate authority has erred in law and on facts in making and confirming respectively the disallowance of deduction u/s 80P of Rs. 3,15,840/-. The same deserves to be deleted.
The appellant craves to reserve his right to add, alter, amend, or delete any ground of appeal during the course of hearing.”
AY 2019-20
“1. The assessment order passed u/s 143(1) of IT Act by the Assessing Officer and confirmed by the first appellate authority u/s 250 is bad in law and deserved to be uncalled for.
The assessing officer as well as first appellate authority has erred in law and on facts in making and confirming respectively the disallowance of deduction u/s 80P of Rs. 3,11,500/. The same deserves to be deleted.
The appellant craves to reserve his right to add, alter, amend, or delete any ground of appeal during the course of hearing.”
I.T.A Nos. 313 & 314/Ahd/2021 A.Y. 2018-19 & 2019-20 Page No. 3 Muncipal Servant Co. Op Credit & Supply Society Ltd. vs. DCIT
The brief facts of the case are that the assessee is a cooperative Society and filed return of income for assessment year 2018-19 on 26.10.2018 declaring total income of “Nil” after claiming deduction of � 3,15,840/- u/s 80P of the Income Tax Act, 1961 (Act). The return of income was processed under section 143 (1) of the Act vide intimation dated 31-05- 2019 determining the total income at � 3,15,840/-. Similarly for AY 2019-20, the assessee filed return of income on 15.10.2019 declaring total income of “Nil” after claiming deduction of � 3,11,502/- u/s 80P of the Act. The return of income was processed u/s. 143(1) of the Act for both the years determining total income at Rs. 3,15,840/- for A.Y. 2018-19 and at Rs. 3,11,502/- for A.Y. 2019-20. The assessee filed respective appeals before Ld. CIT(Appeals) against the aforesaid additions made by CPC.
In appeal, Ld. CIT(Appeals) dismissed the assessee’s appeal by holding that the reason for disallowance of deduction under section 80P of the Act is that the assessee filed return of income beyond due date stipulated under section 139 (1) of the Act. Accordingly, the Ld. CIT(Appeals) dismissed the assessee’s appeal with the following observations (we are reproducing observations for AY 2018-19, but similar observations have been made by Ld. CIT(Appeals) for AY 2019-20 as well):
“6. I have carefully considered the facts of the case and the impugned Intimation issued u/s 143(1). On perusal of the said Intimation dated 31.05.2019, it is seen that the deduction claimed u/s 80P by the appellant has been disallowed therein by way of an adjustment u/s 143(1)(a). In this regard, it is understood that the said disallowance of deduction claimed u/s 80P was made on account of the reason that the return of income has not been filed within the due date specified u/s 139(1) of the Act. The appellant filed its return of income on 26.10.2018 whereas the due date for filing the
I.T.A Nos. 313 & 314/Ahd/2021 A.Y. 2018-19 & 2019-20 Page No. 4 Muncipal Servant Co. Op Credit & Supply Society Ltd. vs. DCIT
return of income as specified u/s 139(1) of the Act was 31.08.2018. The appellant filed the return of income belatedly on 26.10.2018 u/s 139(4) of the Act. As per the provisions of section 80AC (ii) of the Act, as amended by the Finance Act, 2018 with effect from Assessment Year 2018-19, no deduction under any provision of Chapter VI-A of the Act under the heading "C-Deductions in respect of certain incomes" shall be allowed in computing the total income of an assessee unless he furnishes a return of his income on or before the due date specified under sub-section (1) of section 139. Deduction u/s 80P of the Act is one of the deductions specified in part C of Chapter VI-A dealing with Deductions in respect of certain incomes. Since the appellant failed to furnish the return of income within the due date as specified u/s 139(1), it is not eligible for the deduction claimed u/s 80P of the Act as per the provisions of section 80AC (ii) of the Act. Further, the appellant has not obtained condonation of the said delay in filing the return of income from CBDT as per the provisions of section 119(2)(b) of the Act. Hence, the disallowance of the deduction u/s 80P made in the Intimation u/s 143(1) is held to be in accordance with the provisions of the Act and the same is hereby sustained. These grounds of appeal are accordingly dismissed.”
The assessee is in appeal before us against the aforesaid orders passed by Ld. CIT(Appeals). None appeared on behalf of the assessee before us. The Ld. DR relied upon observations made by Ld. CIT(Appeals) at paragraph 6 of the order, wherein he held that post-amendment of section 80AC(ii) of the Act vide Finance Act 2018, the assessee is not entitled to deduction under Chapter VI-A of the Act (including section 80 P of the Act) in case the return of income has not been filed within the due date specified under section 139 (1) of the Act. Since, in the instant set case, the return was filed beyond the date stipulated under section 139(1) of the Act, the assessee cannot be allowed the benefit of section 80P of the Act.
I.T.A Nos. 313 & 314/Ahd/2021 A.Y. 2018-19 & 2019-20 Page No. 5 Muncipal Servant Co. Op Credit & Supply Society Ltd. vs. DCIT
We have heard the contentions of the Ld. DR and perused the material on record. We note that in the case of Chirakkal Service Co-Operative Bank Ltd. Kannur v. CIT 2016] 68 taxmann.com 298 (Kerala), the Kerala High Court held that a return filed by assessee beyond period stipulated under section 139(1) or 139(4) or under section 142(1) or section 148 can also be accepted and acted upon for entertaining claim raised under section 80P provided further proceedings in relation to such assessments are pending in statutory hierarchy of adjudication in terms of provisions of Act. We note that the instant case, there was approximately a two-month delay in filing the return of income by the assessee for the respective assessment years A.Y. 2018-19 & A.Y. 2019-20 and therefore looking into the totality of facts, in the interests of justice, we are restoring the case to the file of the Ld. CIT(Appeals) for fresh adjudication on merits of the case after giving due opportunity of hearing to the assessee for both the assessment years A.Y. 2018-19 & A.Y. 2019-20.
In the result, the appeals of the assessee are allowed for statistical purposes.
Order pronounced in the open court on 22 -06-2022
Sd/- Sd/- (WASEEM AHMED) (SIDDHARTHA NAUTIYAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad : Dated 22/06/2022 आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:-
I.T.A Nos. 313 & 314/Ahd/2021 A.Y. 2018-19 & 2019-20 Page No. 6 Muncipal Servant Co. Op Credit & Supply Society Ltd. vs. DCIT
Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Ahmedabad 6. Guard file. By order/आदेश से,
उप/सहायक पंजीकार आयकर अपील�य अ�धकरण, अहमदाबाद