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Facts
The assessee, a Cooperative Society, filed its Income Tax Return for AY 2018-19 beyond the due date and claimed a deduction under section 80P of Rs. 5,29,124/-. The Central Processing Centre (CPC) made a prima-facie adjustment under section 143(1)(a) denying this deduction due to the delayed filing. The assessee's appeal against the rectification order dated 03.08.2023 was subsequently heard.
Held
The Tribunal held that the CPC lacked the power to make a prima-facie adjustment denying deductions under Chapter VIA (including section 80P) for delayed filing of returns for the assessment year 2018-19. This power was conferred upon the CPC by the Finance Act, 2021, effective from 01.04.2021, through the insertion of section 143(1)(a)(v). Since the adjustment was made prior to this effective date, the CPC had exceeded its jurisdiction, and thus the impugned disallowance was set aside.
Key Issues
Whether the CPC had the jurisdiction to make a prima-facie adjustment under section 143(1)(a) denying deductions under Chapter VIA for delayed filing of the return of income for AY 2018-19, prior to the effective date of the Finance Act, 2021 amendment (01.04.2021).
Sections Cited
Section 250, Section 154, Section 143(1)(a), Chapter VIA, Section 80P, Section 139(1), Section 143(1)(a)(v), Section 10AA
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCHES “SMC”, PUNE
Before: DR.MANISH BORAD
Assessee by : Shri Sanjeev Mutha (Through virtual) Revenue by : Shri Eknath Abhang (Through virtual) Date of hearing : 03.02.2026 Date of pronouncement : 12.02.2026 आदेश / ORDER The captioned appeal at the instance of assessee pertaining to the Assessment Year 2018-19 is directed against the order dated 11.08.2025 of National Faceless Appeal Centre, Delhi passed u/s.250 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) arising out of the Rectification Order dated 03.08.2023 passed u/s.154 of the Act.
The sole grievance of the assessee is against the prima-facie adjustment made by the CPC denying deduction under Chapter VIA of the Act in the Intimation passed u/s.143(1)(a) dated 31.05.2019.
At the outset, ld. Counsel for the assessee submitted that case of the assessee is squarely covered by plethora of decisions where it has been consistently holding that the powers for making such prima-facie adjustment denying deduction under Chapter VIA of the Act for delay in filing the appeal have been conferred to the CPC from 01.04.2021 onwards and he therefore stated that the impugned disallowance deserves to be deleted.
On the other hand, ld. Departmental Representative supported the order of ld.CIT(A).
I have heard the rival contentions and perused the record placed before me. I observe that the assessee is a Cooperative Society and return of income for A.Y. 2018-19 has been furnished on 18.12.2018 which is beyond the prescribed due date of 31.10.2018. Assessee has claimed deduction u/s.80P of the Act at Rs.5,29,124/- but CPC vide Intimation dated 31.05.2019 has denied the said claim on account of delay in filing the return of income. I observe that the issue is no longer res integra by virtue of catena of decisions passed by this Tribunal.
So far as the issue raised by the assessee for the year under consideration that CPC was not having the powers to disallow the deduction claimed under Chapter VI if the return is furnished beyond the due date specified u/s.139(1) of the Act, I find that the said powers have been conferred to the CPC by the Finance Act, 2021 w.e.f. 01.04.2021 in section 143(1)(a)(v) of the Act subsequent to which the CPC is empowered to make prima-facie adjustment to disallow the claim of deduction u/s.10AA or deduction claimed under Chapter VIA if the return is furnished beyond the due date specified in sub-section (1) of section 139 of the Act under the provisions provided u/s.143(1)(a)(v) of the Act. This view has been consistently followed by this Tribunal and Coordinate Benches in plethora of decisions. Some of the decisions on this very issue are quoted below :
i. Pune Bench in the case of Narhari Maharaj Majoor Sahakari Sanstha Ltd. Vs. ITO – order dated 16.07.2025 ii. Shiv Sahyadri Nagari Sahakari Patsanstha Maryadit in order dated 07.11.2024. iii. Coordinate Bench, Chandigarh in the case of Lanjani Cooperative Agri Service Society Ltd. vs. DCIT (2023) 146 taxmann.com 468 (Chandigarh- Trib.). iv. Coordinate Bench, Lucknow in the case of Sahakari Ganna Vikas Samiti Ltd. V. ACIT (2024) 169 taxmann.com 300 (Lucknow-Trib.). v. Coordinate Bench, Rajkot in the case of Chakargadh Seva Sahakari Mandali Ltd.V. DCIT (CPC) (2021) 154 taxmann.com 228 (Rajkot – Trib.).
Respectfully following the above decisions and finding that the alleged disallowance of deduction under Chapter VIA has been made by the CPC prior to 01.04.2021, I find that CPC has exceeded the jurisdiction and therefore the impugned disallowance is uncalled for. Finding of ld.CIT(A) is set aside and deduction u/s.80P of the Act at Rs.5,29,124/- stands allowed. Ground of appeal No.1 raised by the assessee is allowed.
8. Apropos to alternate Ground No.2 regarding 80P(2)(c)(ii) deduction at R.50,000/- is concerned, since deduction u/s.80P of the Act at Rs.5,29,124/- has been allowed, therefore, alternate ground becomes infructuous.
In the result, the appeal of the assessee is allowed as per the terms indicated hereinabove.
Order pronounced on this 12th day of February, 2026.