SIMLON SAMABAY KRISHI UNNAYAN SAMITY LIMITED ,VILL - SIMLON , KALNA-I vs. ASSISTANT DIRECTOR OF INCOME TAX , CPC BENGALURU, C P C BENGALURU, KARNATAKA

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ITA 568/KOL/2024Status: DisposedITAT Kolkata22 July 2024AY 2019-2020Bench: Dr. Manish Borad (Accountant Member)4 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the CPC did not have the power to make a prima facie adjustment disallowing Section 80P deduction for delayed filing prior to April 1, 2021. Therefore, the denial of deduction by the CPC was beyond its jurisdiction for the assessment year in question.

What were the facts?

The assessee, a cooperative society, filed its return of income for AY 2019-20 after the due date, claiming a deduction under Section 80P. The CPC denied this deduction under Section 143(1)(a) due to the delay, which was upheld by the CIT(A).

What were the issues?

Whether the CPC had the jurisdiction to disallow Section 80P deduction under Section 143(1)(a) solely on account of delayed filing of the return for AY 2019-20.

Which sections of the Income-tax Act were involved?

Section 80P,Section 143(1)(a),Section 80AC,Section 139(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH, KOLKATA

Before: Dr. Manish Borad

Simlon Samabay Krishi Unnayan Samity Limited …. Appellant (PAN: AALAS9853P) Vs. Asstt. Director of Income Tax .… Respondent CPC, Bengaluru Appearances by: Shri A. N. Chatterjee, FCA & Shri S. D. Bandyopadhyay, FCA appeared for Appellant. Shri P. P. Barman, Addl. CIT, DR appeared for Respondent. Date of concluding the hearing : 15.07.2024 Date of pronouncing the order : 22.07.2024 ORDER This appeal filed by the assessee pertaining to the Assessment Year (in short “AY”) 2019-20 is directed against the order passed u/s 250 of the Income Tax Act, 1961 in short the “Act”) by Ld. Commissioner of Income-tax (Appeal), Addl/JCIT(A)- 2, Pune [in short Ld. “CIT(A)”] dated 29.01.2024 arising out of the intimation u/s 147 r.w.s. 143(1) of the Act by Asst. Director of Income Tax, CPC dated 28.05.2020.

2.

Through this appeal assessee has challenged the action of Ld. CIT(A) confirming the action of the CPC denying the benefit of sec. 80P of the Act solely on account of delay in filing the return of income and invoking section 80AC of the Act.

I.T.A. No. 568/Kol/2024 Simlon Samabay Krishi Unnayan Samity Ltd., AY : 2019-20 3. At the outset, Ld. Counsel for the assessee referring to the decision of this Tribunal in the cases of Bhairabnala Samabay Krishi Unnayan Samity Ltd. Vs. Asstt. Director of Income Tax, CPC dated 23.11.2022 and ITA No. 1248/Kol/2023 Bisharpara Kodalia Cooperative Credit Society Ltd. Vs. ITO, ITA No. 1248/Kol/2023 dated 06.02.2024 submitted that no adjustment can be made u/s. 143(1)(a) of the Act in the impugned assessment year denying the benefit of deduction u/s. 80P of the Act for delay in filing the return as the power with the CPC for making such adjustments has come into effect only from 01.04.2021 and, therefore, the assessee should be allowed the alleged deduction u/s. 80P of the Act.

4.

On the other hand, the Ld. Vehemently supported the orders of the lower authorities.

5.

I have heard both the parties and perused the material available on record. I notice that the assessee is a cooperative society and the due date for filing the return of income for AY 2019-20 on 31.08.2019 but the return was submitted by the assessee on 28.11.2019 after claiming deduction u/s. 80P of the Act at Rs.5,39,955/-. However, the CPC vide its intimation u/s. 143(1)(a) of the Act dated 28.05.2020 denied the said deduction u/s. 80P of the Act on account of delay in filing the return. I, however, note that this Tribunal in plethora of decisions has consistently held that the said power for making the adjustment u/s. 143(1)(a) of the Act lies with CPC w.e.f. 01.04.2021 for denying deduction u/s. 80P of the Act if the returns are not filed within the due date prescribed u/s. 139(1) of the Act. However, since the impugned order before me is AY 2019-20, the alleged prima facie adjustment should not have been made by the CPC. Similar issue I.T.A. No. 568/Kol/2024 Simlon Samabay Krishi Unnayan Samity Ltd., AY : 2019-20 came up before this Tribunal in the case of Bisharpara Kodalia Cooperative Credit Society Ltd. (supra), wherein this Tribunal has held as under:

“4. We have heard rival submissions and have gone through the record placed before us. We notice that the assessee is a Co-operative Society engaged in the business of providing credit to its members. The assessee is required under law to get its account audited under the rules and regulations of West Bengal Cooperative Societies Act, 2006 by the auditor appointed by Directorate of Cooperative Societies. For the AY 2018-19 due date for filing the return was 30.09.2018. However, the return was submitted on 25.11.2018.

5. We note that the Central Processing Centre denied the deduction u/s. 80P of the Act solely for the reason that return was not filed within the due date. Provisions of section 143(1)(a)(v) provides that – “(v) disallowance of deduction claimed under section 10AA or under any of the provisions of Chapter VIA 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;” 5.1. In the above provision, an amendment brought is in by Finance Act from 01.04.2021 w.e.f. 1.4.21 and before such amendment in place of the phrase section 10A or in any of the provisions of Chapter VIA under the head e – the words “deductions in respect of certain income, previously which was provided as section 10AA, 80IA, 80IB, 80IC, 80ID or section 80IE of the Act were appearing.”

6.

From perusal of the said amendment, we note that before 01.04.2021 there was no mechanism for the CPC to prima facie disallow the claim u/s. 80P of the Act. It was only from 01.04.2021 that such powers have been conferred with the CPC to make prima facie disallowance in case of the claim made u/.s 10AA or deduction claimed under any of the provisions in Chapter VIA which, inter alia, includes 80P of the Act.

7.

We note that section 80AC of the Act puts a bar against claiming of deduction in respect of certain income provided under the head (C) of Chapter VIA which includes section 80P of the Act also if the return of income are not filed before the due date prescribed u/s. 139(1) of the Act. Had it been a case of scrutiny proceeding u/s. 143(3) of the Act, the situation certainly would have been against the assessee subject to the approval by the authorities for condonation of delay in filing the return. However, before us, the issue is regarding prima facie adjustment made u/s. 143(1)(a)(v) of the Act and as discussed above, such power of making the prima facie adjustment towards deduction u/s. 80P of the Act came to CPC only from 1.4.2021 and thus, the alleged disallowance by CPC is beyond its jurisdiction. Therefore, the assessee deserves relief. We are thus inclined to hold that the Ld. CIT(A) erred in denying the deduction u/s 80P of the Act for Rs.19,42,264/-. We, therefore, set aside the order of the Ld. CIT(A) and allow the grounds of appeal

raised by the assessee for the claim of deduction u/s. 80P of the Act at Rs.19,42,264/-.

8. In the result, appeal of the assessee is allowed.” Simlon Samabay Krishi Unnayan Samity Ltd., AY : 2019-20

5. Respectfully following the decision in the case of Bisharpara Kodalia Cooperative Credit Society Ltd. (supra) and the same being squarely applicable on the facts of the instant case, I hereby set aside the order of the Ld. CIT(A) and direct the jurisdictional AO to allow the deduction u/s. 80-P of the Act at Rs.5,39,960/- claimed by the assessee. Accordingly, effective grounds of appeal raised by the assessee are allowed.

6. In the result, appeal of the assessee is allowed. Order is pronounced in the open court on 22nd July, 2024.

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