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Facts
The assessee, a residential housing society, filed its return of income, which was finalized at the returned income. The Pr. CIT initiated proceedings u/s 263, holding that the AO had wrongly allowed a deduction of Rs. 1,31,89,848/- on account of interest income from cooperative banks. The Pr. CIT believed the AO had failed to properly examine or verify this claim.
Held
The Tribunal held that the issue of deduction u/s 80P(2)(d) for interest income from cooperative banks had been examined by the AO during the original assessment. Relying on judicial pronouncements and previous orders of the coordinate bench, including the assessee's own case for A.Y. 2015-16, the Tribunal found that the deduction was rightly allowed.
Key Issues
Whether the Pr. CIT was justified in invoking Section 263 to revise the assessment order and disallow the deduction claimed u/s 80P(2)(d) on interest income from cooperative banks.
Sections Cited
263, 80P(2)(d), 80P(4)
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Income Tax Appellate Tribunal, “H (SMC
ORDER PER RENU JAUHRI, AM: “ The appeal is filed by the assessee against the order of Pr. Commissioner of Income Tax – 41, Mumbai (in short “Pr. CIT”), passed u/s 263 of the Act Income Tax Act, 1961 (in short “the Act”). The assessee has raised the following grounds of appeal:
M/s Splendor Complex Chs Ltd , Mumbai 1. On the facts and in the circumstances of the case, the Ld. P.C.I.T. erred in exercising jurisdiction by invoking provisions of section 263 without giving proper reasons for the same.
On the facts and in the circumstances of the case, the Ld. P.C.I.T erred in directing the A.O. to reconsider the deduction claimed under section 80P(2)(d) of Rs. 1,31,89,848/- even though the said issue was elaborately dealt with by the A.O. by applying its mind while passing original order u/s 143(3).
Without prejudice to the above, on the facts and in the circumstances of the case, the Ld. PCIT erred in not considering the order of the Hon'ble ITAT in the appellant's own case for A.Y. 2015-16 wherein similar issue has been held in favour of the appellant.
In doing so, the Ld. PCIT erred in following the judgment of Hon'ble Supreme Court in the case of Totgar's Co-operative Sale Society Ltd. v. ITO [2010] 322 ITR 283/188 Taxman 282 (SC) although the same was rendered based on section 80P(2)(a)(i) and not section 80P(2)(d) 5. In doing so, the Ld. PCIT erred in relying upon the provisions of section 80P(4) and the judgment of Hon'ble High Court of Karnataka in case of Principal Commissioner of Income-tax, Hubballi vs. Totagars Co-operative Sale Society [2017] 83 taxmann.com 140 (Karnataka) while directing the A.O. to reconsider the deduction under section 80P(2)(d).
The Appellant craves to add, alter or delete all or modify any or all the above grounds of appeal
2. The brief facts are that the assessee is a residential housing society which filed return declaring income of Rs. 36,76,470/- for the A.Y 2018-19. The case was selected for scrutiny and assessment was finalized at returned income vide order dated 09.04.2021. Subsequently, proceedings u/s 263 of the Act were initiated by the Ld. Pr. CIT on the ground that the AO had wrongly allowed the