TELMOCHO PRIMARY AGRICULTURE CREDIT COOPERATIVE LIMITED,DHANBAD vs. ASSISTANT DIRECTOR OF INCOME TAX, BANGALORE

Shri M. K. Chowdhury, Advocate appeared on behalf of the assessee and Shri Khubchand T. Pandya, DR appeared on behalf of the revenue.

The assessee is a primary agriculture credit cooperative society. The assessee had claimed deduction of Rs.13,72,058/- u/s 80P(2) of the Act on interest income earned from credit provided to members. However, the Assessing Officer denied the said claim of deduction u/s 80P in an intimation order passed u/s 143(1) of the Act dated 13.11.2020 on account of delayed filing of return of income. Later on, the ld. CIT(A) has confirmed the order of the Assessing Officer.

It was submitted by the Ld. AR that Ld. CIT(A) erred in not deleting the disallowance u/s 80P of the Act and urged before the Bench to reverse the action of the Ld. CIT(A).

Per contra, the Ld. Sr. DR vehemently supported the orders of the authorities below and submitted that the issue can be restored to the file of the Assessing Officer for further verification.

We have considered the rival submissions. Obviously, the appeal is against the order passed u/s. 143(1). Consequently, the issues cannot be sent back to the Assessing Officer for verification in so far as the verification can be done in an order u/s. 143(3) of the Act only. Further, a perusal of the intimation issued u/s. 143(1) dated 13.11.2020 shows that no show cause notice has been issued to the assessee as per the requirement of the 1st proviso to section 143 of the Act. This having not been done, we are of the view that the intimation issued u/s. 143(1) is unsustainable and consequently, the adjustment made u/s. 143(1) of the Act is deleted.

In the result, the appeal of the assessee stands allowed.