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Income Tax Appellate Tribunal, COCHIN BENCH, COCHIN
Before: SHRI SANJAY ARORA, AM & MS. KAVITHA RAJAGOPAL, JM
O R D E R Per Kavitha Rajagopal, J M:
This appeal has been filed by the assessee, challenging the order of the learned Commissioner of Income Tax (Appeals) (‘ld.CIT(A) for short) passed u/s.250 of the Income Tax Act, 1961 (‘the Act'), pertaining to the Assessment Year (‘A.Y.’ for short)
2016-17.
The assessee has also filed the Stay Application in this matter seeking for stay of recovery of demand raised by the Revenue.
The solitary issue involved in this appeal is the disallowance of deduction of Rs.25,21,667/- u/s. 80P(2)(a)(i) of the Act. The assessee has also challenged the order of SA No. 79/Coch/2023 Kozhikode Town Co-operative Urban Society Limited the ld. CIT(A) in not condoning the delay of 28 days in filing the appeal before the First Appellate Authority.
Briefly stated the assessee is a Co-operative Society registered under the Kerala Co-operative Society Act engaged in providing credit facilities to its Members. The assessee had filed its return of income dated 19.10.2016 for the year under consideration declaring gross total income at Rs.25,21,667/- and taxable income at Rs.Nil after claiming deduction under Chapter VIA as per the provisions of section 80P(2) of the Act.
The assessee’s case was selected for limited scrutiny under CASS to verify the following:
“1. Whether tax aspects related to investments/advances/loans have been considered in the return of income. 2. Whether Sales turnover/receipts has been correctly offered to tax. 3. Whether deduction under Chapter VI-A has been claimed correctly. 4. Whether claim of deduction against business income is admissible.”
The ld. Assessing Officer (ld. A.O. for short) issued notice u/s. 143(2) of the Act which was duly served upon the assessee. The ld. A.O. then passed the assessment order dated 26.11.2018 u/s. 143(3) of the Act determining the total income at Rs.34,86,661/- after making addition/disallowance u/s. 80P of the Act for the reason that the principles of mutuality was not applicable in the case of the assessee society by relying on the decision of the Hon’ble Apex Court in the case of Citizen Co-operative Society Ltd. Vs. ACIT-1(9), Hyderabad.
Aggrieved the assessee was in appeal before the first appellate authority, challenging the assessment order.
SA No. 79/Coch/2023 Kozhikode Town Co-operative Urban Society Limited 7. The ld. CIT(A) dismissed the appeal filed by the assessee on the ground that the assessee has not substantiated the 28 days delay in filing the appeal before the first appellate authority with “sufficient cause” without getting into the merits of the case.
Further aggrieved the assessee is in appeal before us, challenging the order of the ld. CIT(A).
Having heard the rival submissions and perused the materials available on record, it is observed that the assessee has filed the first appeal before the ld. CIT(A) with a delay of 28 days and had stated that the reason for the delay which according to the first appellate authority was not a “sufficient cause” for condoning the said delay. The ld. CIT(A) dismissed the appeal filed by the assessee for the reason that there was inordinate delay in filing the appeal before the first appellate authority.
The ld. Authorised Representative (ld. AR for short) for the assessee contended that the delay in filing the appeal before the ld. CIT(A) was not deliberate and that the assessee had sufficient cause for the delay of 28 days though was well established before the first appellate authority, was not considered. The ld. AR further stated that the said delay was not an inordinate delay.
The ld. Departmental Representative (ld. DR for short), on the other hand, vehemently opposed for condoning the delay in filing the appeal before the first appellate authority.
SA No. 79/Coch/2023 Kozhikode Town Co-operative Urban Society Limited 12. In view of the principles of natural justice and to extend one more opportunity to the assessee, we deem it fit to remand this issue back to the file of the ld. CIT(A) for condoning the delay in filing the appeal before the ld. CIT(A) and, thereby, directing the first appellate authority to decide the issue on the merits of the case.
In the result, the appeal filed by the assessee is allowed for statistical purpose and the stay application is hereby dismissed as infructuous.
Order pronounced on 30.04.2024 under rule 24 of the Income Tax (Appellate Tribunal) Rules, 1963.