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Facts
The assessee, a co-operative society engaged in selling fertilizer and seeds, filed its return for AY 2018-19. The CPC disallowed a deduction of Rs. 12,28,617/- claimed under section 80P(2)(f) due to an error in claiming the exemption under the wrong sub-clause. The assessee's income from sales and dividend from another co-operative society was Rs. 12,88,603/- and Rs. 2,58,602/- respectively.
Held
The Tribunal noted that the assessee is entitled to the exemption claimed under Section 80P(2)(a)(iii), (iv), and (d). It was also noted that the same exemption was allowed in a previous year. The Tribunal observed that the assessee committed an error in filing the return by claiming the exemption under the wrong sub-clause.
Key Issues
Whether the assessee correctly claimed exemption under Section 80P, and if an error in the sub-clause of claiming exemption warrants disallowance or requires an opportunity to rectify.
Sections Cited
143(1), 139(5), 80P(2)(a)(iii), 80P(2)(a)(iv), 80P(2)(d), 80P(2)(f)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, RAJKOT BENCH, RAJKOT
Before: DR. ARJUN LAL SAINI, AM. &
Captioned appeal filed by assessee pertaining to Assessment Year 2018- 19, is directed against order passed by Commissioner of Income Tax (Appeal), vide order dated 04/12/2023, which in turn arises out of an order passed by the Assessing Officer NFAC dated 12/07/2019 u/s 143(1) of the Income Tax Act, 1961.
Grounds of Appeals raised by the assessee : - IT A No .58/RJT /2024 Shr ee Ja mka ndor na Taluka Co-O p. Sa les & Pur cha se Union Ltd
The intimation order u/s. 143(1) of the Act is bad in law.
2. The Ld. AO has erred in law as well as on facts in disallowing the deduction of Rs. 12,28,617/- claimed u/s. 80P of the Act The ld. CIT(A) has erred in law as well as on facts in confirming the same.
Brief facts Of The Case that the appellant filed its original return of income on 23/09/2018 declaring total income at Rs. 1,23,380/- which was revised u/s 139(5) of the Act on 16/02/2019 wherein total income of the appellant remined same. The said revised return of income was processed u/s 143(1) of the act on 12/07/2019 determining total income at 13,52,008/-. In the said intimation the CPC, Bangalore has made disallowance of deduction on dated 21-02-2020, Rs. 12,28,617/- u/s. 80P(2)(f) of the Act. Being aggrieved, the appellant has preferred this appeal.
(i) The assessee has filed an appeal against the intimation u/s 143(1) of the Act. before Ld. CIT(A) on 21-02-2020.That during the course of hearing the Assessee Submitted/furnished following submission
(a) The applicant is the Co-Operative Society engaged in supplying fertilizer and seeds to other small Co-Operative Societies. (b) The Gross Total Income of Society is exempt U/s.80P(2)(a)(iii), 80P(2)(a)(iv) & 80P(2)(d) of the Act. (c) Details of Income & Deduction U/s. 80P is as under: (i) Gross Profit on Sale of Fertilizer and other equipment (ii) Dividend Income from Other Co. Op. Society Exempt U/s. 80P(2)(d)Rs. 2,58,602/-Total Rs. 14,87,219/- (d) The assessee due to oversight, has wrongly shown in the return that income of Rs. 12,28,617/- as exempt U/s. 80P(2)(f) The income earned by society is exempt U/s. 80P(2)(a)(iii) & (iv) of the Act.
IT A No .58/RJT /2024 Shr ee Ja mka ndor na Taluka Co-O p. Sa les & Pur cha se Union Ltd
(ii) That appeal of the assessee is partly allowed by CIT(A) vide order dated 04/12/2023.
(iii) The assessee has filed an appeal against impugned order dated 04/12/2023 before this Tribunal. (i) During the course of the arguments the Ld. AR of the assessee submitted while filling the return of income deduction was wrongly claimed u/s. 80P(2)(f) of the Act. (ii) DR is relied on the order of the lower authority.
We have heard both the party and perused the material an all records. We note that the assessee earned business income from sale of fertilizer and other equipment amount to Rs. 12,88,603/- and Rs. 2,58,602/-. That the assessee is a co. operative society &the gross total income of the assessee is exempt u/s 80P(2)(a)(iii) & 80P(2)(a)(iv) & 80P(2)(d) of the Act.That the society is indulge in the business of the sale of fertilizer and other equipment’s. That the assessee committed error in filing the return and claimed exemption in wrong clause of section 80P(2)(f) amounting to Rs. 12,88,603/- that the CPC Bangalore has process the return and disallowed the claim of exemption in the return. We note that the assessee is entitle to exemption u/s 80P(2)(a)(iii), 80P(2)(a)(iv) & 80P(2)(d) of the Act. However, it is further clarified in the earlier year. The assessee has claimed the same exemption and the same was allowed by CPC Bangalore. We note that the assessee deserves for an opportunity to correct the mistake in the return of income and explain the case before the Ld. AO (JAO). The considering the facts and circumstances the case and in the interest of justice, we are of the view that the assessee deserves for an opportunity to submit detail before the Ld. AO for verification. We set-aside the order ofLd. CIT(A) and remit matter back to the file of the Ld. AO(JAO). The Ld. AO/JAO IT A No .58/RJT /2024 Shr ee Ja mka ndor na Taluka Co-O p. Sa les & Pur cha se Union Ltd adjudicated the matter, and considers the claim of the assessee and pass suitable order according to provision of law. In result the appeal is allowed for the statical purpose.
Order pronounced in the open court on 20 /05/2025.