DHALI PACCS LTD.,TIRUPPUR vs. ITO, WARD-2(4), TIRUPPUR

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ITA 2745/CHNY/2025Status: DisposedITAT Chennai18 February 2026AY 2016-174 pages
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What did the Tribunal hold?

The Tribunal noted that the assessee had raised a fresh claim for deduction under Section 80P(2)(d) in its grounds of appeal, which was not claimed in the return of income. The Tribunal referred to its own decision in ITA No. 1512/Chny/2025, which, in turn, relied on the Hon'ble Jurisdictional High Court's decision in M/s. Perlo Communication [2022] 141 taxmann.com 387 (Mad), holding that there is no provision empowering the Tribunal or appellate authority to entertain a claim not made in the return of income. However, in this specific case, the Tribunal directed the Assessing Officer to admit the claim of deduction under Section 80P(2)(d) after verification, assuming the net profit of ₹24,30,052 represented interest income from Tirupur District Central Co-operative Bank. The ground raised by the assessee was allowed for statistical purposes.

What were the facts?

The assessee, Dhali Primary Agri. Co-op. Credit Society Limited, filed its return of income for Assessment Year 2016-17 declaring NIL income after claiming a deduction under Section VIA amounting to ₹24,30,052. The return was processed under Section 143(1). Subsequently, the case was selected for scrutiny under CASS to examine the deduction claimed under Chapter VIA. The Assessing Officer disallowed the deduction claimed under Section 80P(2)(i)(a) and taxed the entire profit of ₹24,30,052 under business income. The First Appellate Authority confirmed this addition. The assessee then filed an appeal before the ITAT, raising a fresh ground of appeal (Ground No. 5) claiming deduction under Section 80P(2)(d) for the first time.

What were the issues?

1. Whether the assessee is entitled to claim a fresh deduction under Section 80P(2)(d) of the Income Tax Act, 1961, for interest income earned from Tirupur District Central Co-operative Bank, even though it was not claimed in the original return of income or before the lower authorities? Assessee's Contention: The assessee argued that it is entitled to claim deduction under Section 80P(2)(d) towards interest income earned from Tirupur District Central Co-operative Bank. They relied on the Tribunal's decision in ITA No. 1512/Chny/2025 dated 18.08.2025, which allowed fresh claims before the Tribunal. The assessee stated that even if the entire net profit of ₹24,30,052 represents interest income, they are still eligible for the deduction. Revenue's Contention: The Addl. CIT submitted that the assessee should have claimed the deduction in the return of income and did not raise any serious objection to the fresh claim being considered.

Which sections of the Income-tax Act were involved?

Section 80P(2)(d),Section 143(1)

AI-generated summary — verify with the full judgment below

Before: Shri Inturi Rama Rao&

For Respondent: Ms. R. Anita, Addl. CIT
Hearing: 07.01.2026Pronounced: 18.02.2026

O R D E R

PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER:

1.

This appeal filed by the assessee is directed against the order dated 28.08.2025 passed by the Addl/JCIT(A), Panaji for the assessment year 2016-17.

2. In the grounds of appeal

in ground No. 5, the assessee raised a fresh ground of claim of deduction under section 80P(2)(d) of the Income Tax Act, 1961 [“Act” in short], which was claimed either before the Assessing Officer or before the ld. CIT(A) and the same is reproduced herein below:

5. Without prejudice, even if the assumption of the Learned First Appellate Authority that the entire net profit of ₹.24,30,052/- represents interest income from Tirupur District Central Co-operative Bank is correct, the appellant society is still entitled for deduction under section 80P(2)(d) to that extent, though not claimed earlier, given that the Hon’ble Tribunal is empowered to admit fresh claims made otherwise than in return of income (Relying on dated 18.08.2025).

2.

Brief facts of the case are that the assessee filed return of income for AY 2016-17 admitting income at ₹.NIL by claiming deduction under section VIA amounting to ₹.24,30,052/- and the same was processed under section 143(1) of the Income Tax Act, 1961 [“Act” in short]. Subsequently, the case was selected for scrutiny under CASS with limited scope to examine the issue relating to deduction claimed under Chapter VIA. After considering the submissions of the assessee against the statutory notices, the Assessing Officer disallowed the claim of deduction under section 80P(2)(i)(a) of the Act and disallowed the entire business profit of ₹.24,30,052/- and taxed under the head business income. The first appellate authority confirmed the addition.

3.

The ld. AR Shri S. Senthil Kumar, Advocate, referring to ground No.5 raised in the grounds of appeal, submits that the assessee is entitled to claim deduction under section 80P(2)(d) of the Act towards interest income earned from Tirupur District Central Cooperative Bank and prayed to allow the fresh claim of deduction under section 80P(2)(d) of the Act, which was not claimed by relying on the order of this Tribunal in dated 18.08.2025. The ld. DR Ms. R. Anitha, Addl. CIT did not raise any serious objection and submits that the assessee should have claimed in the return of income.

4.

Having heard both the sides, we note that vide ground No. 5 of the grounds of appeal, the assessee has raised a fresh claim of deduction under section 80P(2)(d) of the Act towards interest income earned in the FY 2015-16 relevant to AY 2016-17, but, however, not claimed in the return of income. We have perused the case law relied on by the ld. AR in the case of M/s. TAFE Motors & Tractors Ltd. v. DCIT in dated 18.08.2025, wherein, the Tribunal by referring to various case law including the decision of the Hon’ble Jurisdictional High Court in the case of M/s. Perlo Communication [2022] 141 taxmann.com 387 (Mad), held that there is no provision on the power of Tribunal or appellate authority to entertain such claim which was not made in the return of income. Accordingly, we direct the Assessing Officer to admit the claim of deduction under section 80P(2)(d) of the Act being assumed by the first appellate authority that the entire net profit of ₹.24,30,052/- represents interest income from Tirupur District Central Cooperative Bank after verification of details available on record. Thus, the ground raised by the assessee is allowed for statistical purposes.

5.

In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on 18th February, 2026 at Chennai.

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