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Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI VIJAY PAL RAO & SHRI B.M. BIYANI
This appeal by the assesse is directed against the order dated 27.12.2022 of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centers,(NFAC) Delhi for the Assessment Year 2019-2020.
ITANo.109/Ind/2024 Shraddha Sakh Sahakari Sanstha
There is a delay of 349 days in filing the present appeal. The assessee has filed an application for condonation of delay which is supported by the affidavit of President of the assessee society. The Ld. AR of the assessee has submitted that the CIT(A) has issued only one notice of hearing before passing the impugned ex-parte order. The impugned order was sent by the CIT(A) to the official e- mail ID of the assessee society however, due to oversight of the concerned staff the impugned order did not came to the knowledge of the management of the assessee society and therefore, there was a delay in filing the present appeal. Thus, Ld. AR has submitted that only when the counsel of the assessee going through the e- proceedings tab on the e-filing portal of the department came across the fact that CIT(A) has already passed the impugned order on 27.12.2022 against which the appeal was yet to the filed. The Ld. AR has pointed out that after the impugned order came to the knowledge of the management of the assessee it has taken steps to file the present appeal without any further delay however, in the meantime there was already a delay of 349 days in filing the present appeal. The Ld. AR has pleaded that the delay in filing the Page 2 of 9
ITANo.109/Ind/2024 Shraddha Sakh Sahakari Sanstha appeal is unintentional but due to bonafide mistake and oversight of the concerned staff in noticing the impugned order sent to the e- mail. In support of this contention he has relied upon following decisions:
(i) Vijay VishanMeghani vs. DCIT (Bombay High Court) (2017) 398 ITR 250. (ii) Improvement Trust vs. Ujagar Singh (Supreme Court) Civil Appeal Nos. 2395 of 2008 dated 26.06.2010. (iii) Hon’ble Supreme Court of India in Collector Land
Acquisition, Anantnag & Anr. Vs. Mst. Katiji & Ors as reported in (1987) 62 CTR (SC) 23: (1987) 13 AIR 306(SC).
On the other hand Ld. Departmental Representative has vehemently objected to the condonation of the delay and submitted that this is a case of negligence on the part of the assessee which cannot be accepted as a reasonable cause for delay of 349 days in filing the present appeal.
We have considered the rival submissions as well as perused the relevant materials on record. The assessee in the affidavit of its President has narrated the reasons as under: Page 3 of 9
ITANo.109/Ind/2024 Shraddha Sakh Sahakari Sanstha “1. I am the President of the society, M/s Shraddha Sakh Sahkari Sanstha. The income-tax return of the said society for the Assessment Year 2019-20 was filed on 13-10-2020 wherein total income was declared at Rs. NIL after claiming deduction of Rs. 15,51,612/- under section 80P of the Income-Tax Act, 1961 ('the Act').
2. The return of Income was processed under section 143(1) of the Act wherein deduction of Rs. 15,51,612/- claimed under section 8OP of the Act was disallowed since return of Income was not filed within the due date prescribed under section 139(1) of the Act. Against this order, the society filed an appeal before the Ld. CIT(A) challenging the disallowance of deduction claimed under section 80P of the Act am the Ld. CIT(A), NFAC, Delhi vide order dated 27-12-2022 passed under section 25 of the Act dismissed the appeal filed by the society.
3. The said order passed by the Ld. CIT(A), NFAC, Delhi was served on the registered E-Mall of the society which was Inadvertently overlooked by the concerned personnel of the society as a result of which we were unaware of the fact that CIT(A) order had been passed on 27-12-2022. It was just recently that our present counsel on going through the E-Proceedings tab on the E-Filing Portal of the Income-Tax Department came across the fact that CIT(A) Order had been passed under section 250 of the Act on 27-12- 2022 against which appeal remained to be filed before the Hon'ble ITAT, Indore Bench. However, as soon as this fact came across our counsel, he advised us to immediately file an appeal before the Hon'ble Bench challenging the order passed by the Ld. CIT(A), NFAC, Delhi.
4. It was for the aforesaid reason that the present appeal is being filed before the Hon'ble Bench with a delay of 349 days (till 9th February, 2024). However, I would like to submit before the Hon'ble Bench that as soon as our present counsel advised us to file an appeal before the Hon'ble ITAT, Indore Bench against the appellate passed under section 250 of the Page 4 of 9 ITANo.109/Ind/2024 Shraddha Sakh Sahakari Sanstha Act, we paid the challan for appeal fees immediately and accordingly, the present appeal is boing filed without any further delay.
Hence, in the interest of substantial justice, Hon'ble Bench is hereby requested to condone the delay in filing of the present appeal and admit the appeal as legal and valid.”
5. Thus, it is stated that the impugned order was sent by CIT(A) on the registered e-mail ID of the society which was inadvertently over looked by the concerned personnel of the society and therefore, the management of the society were not aware of the impugned order of CIT(A) till it was brought to the notice by the counsel of the assessee. Thus, the assessee has pleaded that it is only due to inadvertence and bonafide mistake on the part of the concerned staff of the society for overlooking the e-mail sent by CIT(A) the assessee could not file the appeal within limitation. The assessee in the application for condonation of delay as well as in the affidavit has honestly and fairly explained the inadvertence and bonafide mistake on the part of the concerned staff and therefore, we find that there is nothing on record to suggest that by filing the appeal belatedly there was any malafide intention on the part of the assessee to take undue advantage in underhand way. Accordingly, in the facts and circumstances of the case and in view of the Page 5 of 9
ITANo.109/Ind/2024 Shraddha Sakh Sahakari Sanstha various judgments relied by the Ld. AR of the assessee we condone the delay of 349 days in filing the present appeal subject to the cost of Rs.2,500/- to be paid to Prime Minister National Relief Fund.
The assessee shall produce the receipt of deposit of the cost with the registry.
The appeal of the assessee is taken up for adjudication wherein the assessee has raised following grounds of appeal:
“1. That on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deciding the appeal ex-parte without giving proper opportunity of being heard to the appellant.
2. That on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in confirming the action of the Ld. CPC, Bengaluru in disallowing the deduction of Rs. 15,51,612/- claimed under section 80P of the Act in the intimation order passed under section 143(1) of the Act even when such adjustment was outside the purview of intimation order.
3. That on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in confirming the action of the Ld. CPC, Bengaluru in disallowing the deduction of Rs. 15,51,612/- claimed under section 80P of the Act simply for the reason that return of income was not filed within the due date prescribed under section 139(1) of the Act more so when return of income was duly filed under section 139 of the Act and deduction was also allowable on merits.
4. The appellant reserves the right to add, alter and modify the grounds of appeal as taken by it”.
The Ld. AR has submitted that the CPC while processing the return of income u/s 143(1) has denied the deduction u/s 80P of the Act on the ground of delay in filing the return of income. He
ITANo.109/Ind/2024 Shraddha Sakh Sahakari Sanstha has contended that at the relevant point of time the CPC was not having the jurisdiction u/s 143(1) of the Act to make such an adjustment on account of deduction u/s 80P of the I.T. Act. He has pointed out that the relevant amendment to the provisions has been brought vide Finance Act 2021 w.e.f. 01.04.2021 whereas the CPC has denied the claim of deduction u/s 80P vide intimation dated 24.2.2021. He has further submitted that this issue is covered by the decision of this Tribunal dated 31.07.2023 in case of Gajra Gears Kamgar Sahakari Sanstha Maryadit v/s DCIT, CPC, Bangalore (supra) in ITA No. 347/Ind/2022.
On the other hand Ld. Departmental Representative relied upon the orders of the authorities below.
We have considered rival submissions as well as relevant material on record. The claim of deduction u/s 80P was denied by CPC while processing the return of income u/s 143(1) of the Act vide order dated 24.02.2021 therefore, the impugned order u/s 143(1) was passed by CPC prior to the amendment vide Finance Act 2021 w.e.f. 01.04.2021. This Tribunal in case of Gajra Gears Kamgar Sahakari Sanstha Maryadit v/s DCIT, CPC, Bangalore (supra) has considered the identical issue in para 5 to 7 as under: Page 7 of 9 ITANo.109/Ind/2024 Shraddha Sakh Sahakari Sanstha “5. Ld. AR straightaway carried us to the provision of section 143(1) and demonstrated that the power to disallow deduction for belated filing of return after due date u/s 139(1) is prescribed in section 143(1)(a)(v). Then, he submitted that at the relevant time, the provision of said section 143(1)(a)(v) prescribed thus: “(v) disallowance of deduction claimed under sections 10AA, 80-IA, 80- IAB, 80-IB, 80-IC, 80-ID or section 80-IE, if the return is furnished beyond the due date specified under sub-section (1) of section 139;” This section was subsequently amended through Finance Act, 2021, w.e.f. 01.04.2021 to read as under: “(v) disallowance of deduction claimed under section 10AA or under any of the provisions of Chapter VI-A under the heading "C.—Deductions in respect of certain incomes", if the return is furnished beyond the due date specified under sub-section (1) of section 139;”
6. Ld. AR submitted that prior to amendment, specific deductions, namely the deductions u/s 10AA, 80-IA, 80-IAB, 80-IB, 80-IC, 80-ID and 80-IE could only be disallowed if the return was not filed in time. But there was no provision to disallow deduction u/s 80P. It is after amendment from 01.04.2021 that the language was widened to confer power to disallow any deduction falling under heading “C-Deductions in respect of certain incomes” of Chapter VI-A. Thus, the disallowance of deduction u/s 80P was brought in the scope of section 143(1) through amendment from 01.04.2021. Ld. AR also filed a copy of the “Memorandum explaining the provisions in The Finance Bill, 2021” wherein it is clearly mentioned that the amendment shall apply from 01.04.2021. Ld. AR submitted in the present case, the AO has disallowed deduction in the intimation passed on 31.05.2019 for AY 2018-19 at the time when there was no authority to disallow deduction u/s 80P for the reason of non-filing of return in time. Ld. AR also relied upon the decision of ITAT, Rajkot Bench in Aliudepur Seva Sahakari Mandli Ltd. Vs. The ADIT (CPC), Bengaluru, order dated 24.02.2023, relevant paragraph is extracted below: “6.2 Respectfully following the above Co-ordinate Bench decisions, we have no hesitation in holding that the assessee cannot be denied the deduction u/s 80P of the Act on the ground that the assessee did not file the return of income within the due date prescribed u/s 139(1) of the Act under proceedings made u/s 143(1) of the Act for the Assessment year 2019-20.”
7. With these submissions, Ld. AR argued that the disallowance made by Ld. AO in present case is beyond authority and the same deserves to be deleted. Ld. DR could not controvert the submissions of Ld. AR.”
ITANo.109/Ind/2024 Shraddha Sakh Sahakari Sanstha
Accordingly to maintain the rule of consistency we follow the earlier decision of this Tribunal and consequently the disallowance made by the CPC while processing the return of income u/s 143(1) of the Act in respect of deduction u/s 80P is not sustainable in law and same is deleted.
In the result appeal of the assessee is allowed.
Order pronounced in the open court on 23.09.2024.