KOZHIKODE TOWN CO-OPERATIVE URBAN SOCIETY LIMITED,KOZHIKODE vs. ITO, KOZHIKODE
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Income Tax Appellate Tribunal, COCHIN BENCH, COCHIN
Before: SHRI SANJAY ARORA, AM & MS. KAVITHA RAJAGOPAL, JM
IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN
BEFORE SHRI SANJAY ARORA, AM AND MS. KAVITHA RAJAGOPAL, JM ITA No. 484/Coch/2023 (Assessment Year: 2016-17) And Stay Application No. 79/Coch/2023 (Arising out of ITA No. 484/Coch/2023 (Assessment Year: 2016-17)
Kozhikode Town Co-operative Urban ITO, Kozhikode Society Limited Vs. Kallai Post, Kozhikode – 673 003
PAN/GIR No. AAAAK 9146 J (Assessee) (Respondent) :
Assessee by : Shri Jaikrishnan : Smt. J M Jamuna Devi Respondent by
: 13.03.2024 Date of Hearing Date of Pronouncement : 30.04.2024
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
2 ITA No. 484/Coch/2023 & 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.
3 ITA No. 484/Coch/2023 & 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.
4 ITA No. 484/Coch/2023 & 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.
Sd/- Sd/- (Sanjay Arora) (Kavitha Rajagopal) Accountant Member Judicial Member Mumbai; Dated : 30.04.2024 Roshani, Sr. PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. CIT - concerned 4. DR, ITAT, Cochin 5. Guard File BY ORDER,
(Dy./Asstt. Registrar) ITAT, Cochin
