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Facts
The assessee, a cooperative society, filed its return of income for AY 2018-19 beyond the due date, claiming a deduction under section 80P. The AO disallowed the deduction invoking section 80AC. The CIT(A) upheld the AO's disallowance. The assessee filed a petition with CBDT for condonation of delay in filing the return.
Held
The Tribunal noted that a petition for condonation of delay was pending before the CBDT, which had a direct bearing on the issue. Therefore, the Tribunal set aside the CIT(A)'s order and remitted the matter back for denovo adjudication after the CBDT's decision on the condonation petition.
Key Issues
Whether the deduction under section 80P is allowable when the return of income was filed beyond the due date, and a petition for condonation of delay is pending before the CBDT.
Sections Cited
80P, 80AC, 139(1), 119(2)(b)
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Income Tax Appellate Tribunal, ‘C’ BENCH: CHENNAI
Before: SHRI SS VISWANETHRA RAVI & SHRI JAGADISH
The Pallipalayam Farmers Service The Income Tax Officer, Co-operative Society Ltd., Vs. Circle-1, S N 208, Pallipalayam Farmers Co- Erode. op. Society Ltd., Pallipalayam, Tiruchengode, Namakkal – 638006. [PAN AAEAT 1678G] (अपीलाथ"/Appellant) (""यथ"/Respondent) अपीलाथF की ओर से/ Appellant by : Ms. G. Vardhini Karthik, Advocate HIथF की ओर से /Respondent by : Ms. R. Anita, Addl. CIT सुनवाई की तारीख/Date of Hearing : 13.08.2024 घोषणा की तारीख /Date of Pronouncement : 21.08.2024 आदेश / O R D E R PER JAGADISH, A.M: Aforesaid appeal filed by the assessee for Assessment Year (AY) 2018-19 arises out of the order of Learned Commissioner of Income Tax (Appeals), [NFAC], Delhi [hereinafter “CIT(A)”] dated 29.02.2024.
The only effective ground of appeal is against confirming the disallowances u/s 80P of the Act made by AO invoking the provisions of section 80AC of the Act, even though the application for :- 2 -: condonation of delay u/s 119(2)(b) as per CBDT Circular No.13/2023 dated 26.07.2023 is pending with CBDT .
3. The brief facts of the case are that the appellant society filed return of income for AY 2018-19 on 30.03.2019 offering a gross total income of Rs.2,66,78, 1 91/- and total income of Rs. Nil after claiming deduction of Rs. 2,66.78.191/- under section 80P of the Act. The AO in the order u/s 143(3) has disallowance of claim for deduction u/s 80P of the Act invoking the provisions of section 80AC that assessee is not eligible for deduction u/s 80P as return has been filed beyond the due date specified u/s 139(1) of the Act. The AO has also held on merit that interest income is neither allowable u/s 80P(2) (a) () or 80P(2) (d) of the Act. Being aggrieved, the assessee preferred an appeal before the Ld.CIT(A). The Ld.CIT(A) has dismissed the appeal of assessee observing as under:
In this respect, it is mentioned that in the present matter also there is NO DISPUTE that the return of income for the year under Consideration corresponding to A Y 2018-19 was filed by ne assessee on 30.03.2019 as against the due date of 31.10.2018 as per the provisions of Section 139(1) of the Act. Under such circumstances, respectfully following the above referred m binding decision of the Hon'ble Jurisdictional High Court, Madras as well as [il the decision of the Hon'ble High Court, Kerala-no interference is called for in the action of the Ld. AO in denying the deduction of Rs. 2,66,78,191/-during the year under consideration as per the provisions of section 80AC of the Act, Accordingly, the appeal is, thus, DISMISSED. Before parting, it is mentioned that as per above discussion the action of the Ld. AO in denying the deduction of Rs. 26678191/- during the year under consideration as per the provisions of section :- 3 -: 80AC of the Act has been upheld. Hence, the issues w.r.t. (examining) merits of claim of deduction u/s 80P now evidently partake academic nature -NOT requiring adjudication, thus, DISMISSED. Reliance is placed on the decision of the Hon'ble Jurisdictional High Court, Madras in the Case of AA520 Veerappampalayam Primary Agricutural Cooperative Credit Society Lid. [supra] as well in the case of Shree Datta Prasad Sahakari Patsanstha Ltd. V. JTO J20221 134 taxmann.com 324 (Mumbai - Trib.) wherein it has been held that-where assessee had not claimed deduction under section 80P(2) in its return of income, it could not be allowed such deduction in view of condition imposed under section 80A(5) even though it was otherwise eligible for such deduction [emphasis supplied
4. Before us, the Ld. Counsel submitted that CBDT has issued circular no 13/2023 dated 26.07.2023 allowing cooperative society to claim deduction u/s 80P by filling condonation of delay petition u/s 119(2)(b) to treat the return filled u/s 139(1). The Ld AR submitted that a petition u/s 119(2)(b) dated 26.12.2023 for condonation of delay in fling claim of deduction u/s 80P has been filed and still pending before the Central Board of Direct Taxes (CBDT in short), therefore Ld CIT(A) should have awaited before dismissing appeal solely on ground that claim u/s 80P is not allowable as return was not filled within due date. The Ld AR prayed for set aside the matter before Ld.CIT(A) for fresh adjudication only after receipt of order of CBDT on petition u/s 119(2) (b) dated 26.12.2023 for condonation of delay in filing claim of deduction u/s 80P of the Act.
The Ld. D.R has not objected to the prayer of the ld. Counsel for the assessee. :- 4 -:
We have heard both the parties, perused the materials available on record and gone through orders of the authorities below. The Ld CIT(A) has dismissed the appeal for claim of deduction u/s 80P , merely for the reason that assessee has not filled return within the prescribed due date and as per section 80AC such deduction are not allowable. The Ld CIT(A) has not adjudicated on merit . The Co-ordinate bench in the case of The Erode City Municipal Corporation Emp. Co-op. T & C Limited K831 vs. Assessing Officer, Ward1-(1), Erode in & 510/Chny/2024 vide order dated 22.07.2024 on similar facts has held as under:
We have heard both the parties, perused the materials available on record and gone through orders of the authorities below. It is admitted fact that a petition u/s 119(2)(b) dated 26.12.2023 for condonation of delay in filing claim of deduction u/s 80P is still pending adjudication before the CBDT hence the same has a direct bearing on the issue in hand. Therefore, we deem it fit to restore back the appeal to the ld. CIT(A) for denovo adjudication only after receipt of order of CBDT on petition u/s 119(2)(b) dated 26.12.2023 for condonation of delay in filing claim of deduction u/s 80P. The ld.CIT(A) will proceed with the appeal after affording reasonable opportunity of hearing to the assessee. That on receipt of order of CBDT on petition u/s 119(2)(b) dated 26.12.2023 for condonation of delay in filing claim of deduction u/s 80P, the assessee is also directed to substantiate its case forthwith failing which Ld. CIT(A) shall be at liberty to proceed with disposal of appeal on merits.
Respectfully following the order of this Tribunal, supra, we set aside the order Ld. CIT(A) and remit the matter back to the file of Ld. :- 5 -: CIT(A) for denovo adjudication only after receipt of order of CBDT on petition u/s 119(2)(b) dated 26.12.2023 for condonation of delay in filing claim of deduction u/s 80P of the Act. In view of the above, the appeal filed by the assessee is allowed for statistical purposes.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced on 21st August, 2024. (यस यस िव"ने" रिव) (जगदीश) (Jagadish) (SS Viswanethra Ravi) लेखा लेखा सद"य लेखा लेखा सद"य सद"य /Accountant Member सद"य सद"य / Judicial Member "याियक "याियक सद"य "याियक "याियक सद"य सद"य चे"ई/Chennai, "दनांक/Dated: 21st August, 2024. EDN/-