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Facts
The assessee, a co-operative housing society, filed its return of income claiming deduction under Section 80P(2)(d) for interest income earned from cooperative banks. The CPC restricted this deduction, leading to a demand. The assessee faced difficulties in filing a rectification application and subsequently an appeal before the CIT(A), resulting in a delay.
Held
The Tribunal held that there was a reasonable cause for the delay in filing the appeal before the CIT(A) as the assessee was attempting to resolve the issue with the CPC. The Tribunal condoned the delay of 52 days in filing the present appeal before it.
Key Issues
Whether the delay in filing the appeal before the CIT(A) and the Tribunal was to be condoned? Whether the deduction claimed under Section 80P(2)(d) was allowable?
Sections Cited
80P(2)(d), 139(1), 143(1)
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Income Tax Appellate Tribunal, “SMC” BENCH, MUMBAI
Before: SMT BEENA PILLAI
Per Beena Pillai, JM: Present appeal filed by the assessee arises out of order dated 20-08-24 passed by Ld.CIT(A)-2, Vadodara for assessment year 21- 22 on following grounds of appeal: 1. “On the facts and circumstances of the case and as per the provisions of law, the Hon'ble Commissioner of Income Tax (Appeals) has erroneously rejected the Assessee's application for condonation of delay of 52 days in filing of the appeal
1. 2. Without prejudice to the above, on the facts and circumstances of the case and as per the provisions of law, the Hon'ble Commissioner of Income Tax (Appeals) has erred in confirming the disallowance of Sea Face Park Co. Operative Housing Society Limited; A. Y.2021-22 deduction of Rs 17,34,915 claimed by the Assessee under Section 80P(2)(d) of the Act.” Brief facts of the case are as under:
2. At the outset, the Ld.AR submitted that, the assessee is a co- operative housing society registered under the Maharashtra Cooperative Societies Act, 1961. For the year under consideration, the assessee filed its return of income on 12.02.2022, declaring total income of Rs.17,10,030. The assessee earned interest income of Rs.22,57,015/- from Saraswat Co-operative bank. Accordingly, the assessee claimed deduction under section 80P(2)(d) of the Act in respect of the interest income earned from the fixed deposits made in cooperative banks.
2.1. It is submitted that for the year under consideration, due to COVID situation, the due date of filing the return for AY 2021-22 was extended by the Government of India till 15.03.2022 and the same was pointed out in the said impugned intimation. It was submitted that the return was filed within the time limit prescribed under Section 139(1) of the Act and hence the assessee was also eligible to claim the deduction under Section 80P(2)(d) of the Act. However, on 19.10.2022, the assessee received intimation under Section 143(1) of the Act from CPC. The deduction under Section 80P(2) (d) of the Act claimed by the assessee in its return of income was restricted to Rs. 5,22,100/- u/s. 80P(2)(d) of the Act. It was submitted that partial deduction under Section 80P(2) (d) of the Act by the CPC resulted in a demand of Rs.6,76,290/-. Page | 2 Sea Face Park Co. Operative Housing Society Limited; A. Y.2021-22 2.2. The assessee tried several times to file rectification application. However, no such option was available with the assessee on the income tax portal to apply for rectification.
2.3. The Ld. AR submitted that, in the process of filing the rectification application with the CPC, there was a delay in filing appeal before the Ld.CIT(A). He said that, the assessee filed its appeal with the delay of 52 days which was not condoned by the Ld.CIT(A) by observing as under:
7.9. In the present case, appellant has neither mentioned any cogent and convincing ground for delay in filing the appeal nor furnished anything to prove that it had acted diligently and was not guilty of negligence. Under these circumstances, as the appeal is filed beyond the due date prescribed under law and no valid reason for same has been mentioned. Therefore delay in filing of appeal is not condoned. In the result, appeal stands dismissed. aggrieved by the order of the Ld.CIT(A), assessee is in appeal before this tribunal.
The Ld.AR referring to the application filed by the assessee seeking condonation of delay before the Ld.CIT(A) submitted that reason for the delay in filing the appeal was specifically mentioned. He submitted that, assessee was trying to settle the issue with the Jurisdictional assessing officer for erroneous denial of the claim by the CPC on its own without seeking any advice from a professional. It was subsequently that the Ld.AO intimated the assessee to prefer an appeal before the Ld.CIT(A) thereby causing the delay.
3.1. The Ld.AR submitted that, assessee is a Cooperative society and only disallowance made by the CPC was u/s. 80P(2)(d) wherein interest earned from deposits made with Saraswat Cooperative Page | 3 Sea Face Park Co. Operative Housing Society Limited; A. Y.2021-22 Bank was partially disallowed. He submitted that, identical issue was considered and allowed in assessee’s own case by the ld. CIT(A)-30, Mumbai, for A.Y. 2015-16. The Ld.AR has filed a copy of the set order.
Affidavit 3.1.1. The Ld.AR thus prayed for the delay to be condoned and he placed reliance on the following decisions in support of the submission: a) Hon'ble Jurisdictional High Court in the case of CIT & Another Vs. ISRO Satellite Center, in of 2008 vide order dated 28/10/2011 b) Coordinate Bench of this Tribunal in the case of Smt. Shakuntala Hegde, Legal Heir of Mr. Ramakrishna Hegde Vs. ACIT, in order dated 25/04/2006 c) Hon'ble High Court of Madras in the case of Commissioner of Income-tax Vs. K.S.P.Shanmugavel Nadar (1987) 30 Taxmann 133 (Madras). d) Hon'ble Tribunal in the case of M/s. Midas Polymer Compounds Pvt Ltd Vs. ACIT in ITA No.288/Coch/2017 dated 25.06.2018. e) Hon'ble High Court of Bombay in the case of Anatek Services Pvt Ltd Vs. Asst.Commissioner of Income-tax-10(1) in ITA No.102 of 2018 dated 11.02.2022. f) Hon'ble Apex Court in the case of Collector, Land Acquisition Vs. MST.Katiji and Others (1987) 167 ITR 471 and g) Concord of India Insurance Co. Ltd., Vs Smt. Nirmala Devi and Others 118 ITR 507. h) Hon'ble Apex Court in the case of Radha Krishna Rai Vs. Allahabad Bank & Others [2000] 9 Supreme Court Cases 733 and i) Commissioner of Income-tax Vs. West Bengal Infrastructure Development Finance Corporation limited (2011) 334 ITR 269 (SC). j) M/s. Space Employees Co-operative Housing Society Ltd. vs. ITO in ITA Nos. 1072 to 1074/Bang/2023 vide order dated 31/01/2024 Sea Face Park Co. Operative Housing Society Limited; A. Y.2021-22 3.2. At the outset, the Ld.AR submitted that there is a delay of 52 days in filing the appeal for A.Y. 2021-22 before this Tribunal. In support of the application seeking condonation of delay, the Ld.AR has filed the affidavit stating as under:
3.3. On the contrary the Ld. DR placed reliance on the order passed by authorities below. We have perused the submissions advanced by both sides in light of records placed before us.
It is noted that, there is a reasonable cause for the delay in filing appeal before the Ld.CIT(A) as the assessee was trying to resolve the issue with the CPC. From the affidavit filed by the assessee, there does not arise any malafide intention on behalf of assessee for not filing the present appeals before this Tribunal.
4.1. In our view, the assessee has made out a reasonable cause for the delay that is caused in filing the present appeals before this Tribunal. Nothing to establish any contrary intention is filed by the revenue before this Tribunal. In our opinion there is a sufficient cause for condoning the delay as observed by Hon’ble Supreme Court in case of Collector Land Acquisition Vs. Mst. Katiji & Ors., reported in (1987) 167 ITR 471 in support of his contentions. 4.2. Reliance is placed on following observations by Hon’ble Supreme Court in case of Collector Land Acquisition Vs. Mst. Katiji & Sea Face Park Co. Operative Housing Society Limited; A. Y.2021-22 Ors., reported in (1987) 167 ITR 471 wherein, Hon’ble Court observed as under:- “The Legislature has conferred the power to condone delay by enacting section 51 of the Limitation Act of 1963 in order to enable the courts to do substantial justice to parties by disposing of matters on de merits". The expression “sufficient cause” employed by the Legislature is adequately elastic to enable the courts to apply the law in a meaningful manner which subserves the ends of justice that being the life- purpose of the existence of the institution of courts. It is common knowledge that this court has been making a justifiably liberal approach in matters instituted in this court. But the message does not appear to have percolated down to all the other courts in the hierarchy.
And such a liberal approach is adopted on principle as it is realized that :
Ordinarily, a litigant does not stand to benefit by lodging an appeal late.
Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. ......................................................1.Any appeal or any application, other than an application under any of the provisions of Order XXI of the Code of Civil Procedure, 1908, may be admitted after the prescribed period if the appellant or the applicant satisfies the court that he had sufficient cause for not preferring the appeal or making the application within such period.”
4.3. Considering the submissions by both sides and respectfully following the observation by Hon’ble Supreme Court, we find it fit to condone the delay caused in filing the present appeals as it is not attributable to the assessee.
Sea Face Park Co. Operative Housing Society Limited; A. Y.2021-22 In any event, though the procedural law pertaining to the limitation has been drafted to construe it strictly, the fact remains that, considering such technicalities will not advance the cause of justice. Considering the above facts and in circumstances, the delay of 52 days in filing the present appeal for A.Y. 2021-22 stands condoned. As the ld. CIT(A) has not decided the issue on merits of the addition I remit this issue back to the Ld.CIT(A) to consider the claim of assessee in accordance with law. More so, on the fact that identical issue for A.Y.2015-16 the Ld.CIT(A)-30, Mumbai has already allowed the deduction claimed by the assessee.
Accordingly, the grounds raised by the assessee stands partly allowed for statistical purposes.
In the result the appeal filed by the assessee stands partly allowed for statistical purposes.
Order pronounced in the open court on 31.12.2024.