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Facts
The assessee, a cooperative credit society, claimed a deduction under Section 80P of the Income Tax Act, 1961, but erroneously filed Form 10-IF opting for the new tax regime under Section 115BAD. The CPC/Assessing Officer disallowed the Section 80P deduction and assessed the income, which was upheld by the CIT(A).
Held
The Tribunal found that the CIT(A) erred in sustaining the disallowance without providing proper opportunity and overlooking the fact that the assessee's case did not satisfy the conditions under Section 115BAD(2). The matter was restored to the Assessing Officer for fresh adjudication on merits, allowing the assessee an opportunity to present its case.
Key Issues
Whether the disallowance of Section 80P deduction was valid when the assessee erroneously opted for Section 115BAD, and if the adjustment under Section 143(1) was permissible without proper opportunity.
Sections Cited
Section 80P, Section 115BAD, Section 143(1), Section 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “SMC” BENCH PANAJI
Before: SHRI PAVAN KUMAR GADALE
Assessee by Shri.Shyam J Kamat.AR Revenue by SHri.Sanket Deshmukh.Sr.DR सुनवाई की तारीख/Date of Hearing 17.02.2026 घोषणा की तारीख/Date of Pronouncement 27.02.2026 ORDER
PER PAVAN KUMAR GADALE ,JM:
The assesse has filed the appeal against the order of the ADDL/JCIT (A) -3 Chennai passed U/sec 143(1) and u/sec 250 of the Act. The assessee has raised the grounds of appeal
challenging the order of the CIT(A) sustaining the denial of deduction u/sec80P(2) of the Act made by the CPC/ Assessing Officer.
2. The brief facts of the case are that, the assessee is a registered cooperative credit society and is engaged in providing credit facilities to its members. The assessee has Bicholim Electricity Employees Cooperative Credit Society Limited. filed the return of income for A.Y.2024-25 disclosing a total income of Rs.Nil after claiming deduction u/se 80P of the Act of Rs.44,93,620/-.Whereas the assessee has filed Form.10-IF u/sec115BAD of the Act exercising option for new regime for lower rate of tax applicability. The return of income was processed u/sec143(1) of the Act disallowing the claim of deduction u/sec80P of the Act and determined the assessed income of Rs.44,93,620/- vide order dated14.10.2025
Aggrieved by the order, the assesse has filed an appeal before the CIT(A), whereas the CIT(A) has considered the grounds of appeal, statement of facts and submissions but has confirmed the action of the A.O/CPC and dismissed the appeal. Aggrieved by the order of the CIT(A), the assessee has filed an appeal before the Hon'ble Tribunal.
4. At the time of hearing, the Ld.AR submitted that the CIT(A) has erred in confirming the action of the Assessing officer overlooking the information filed. The Ld.AR submitted that the AO/CPC erred in overlooking the proviso to Sec115 BAD(1) and sec115BAD(2) of the Act as the option of new regime becomes invalid and the assessee has erroneously filed Form.10-IF u/sec115BAD of the Act exercising option for new regime for benefit of lower rate
Bicholim Electricity Employees Cooperative Credit Society Limited. of tax applicability.Further the Ld.AR submitted that the assesse has a good case on merits and shall substantiate with the material evidences and prayed for an opportunity to explain before the lower authorities. Per Contra, the Ld.DR supported the order of the CIT(A).
Heard the rival submissions and perused the material on record. The crux of the disputed issue envisaged by the Ld.AR that the CIT(A) has erred in sustaining the denial of deduction u/sec80P(2) of the Act made by the CPC/ Assessing Officer without providing proper opportunity and overlooking the facts and material evidences. Further the CIT(A) has not considered the information supporting the claim of the assessee in spite of the fact that the assessee case does not satisfy the conditions u/sec115BAD(2) of the Act though the assessee has erroneously filed Form.10-IF u/sec115BAD of the Act exercising option for new regime for lower rate of tax applicability. The Ld.AR contentions are that the CIT(A) erred in sustaining the adjustment u/sec143(1) of the Act made by CPC which are not covered within the permissible adjustments.Hence considering the overall facts, circumstances and principles of natural justice shall provide with one more opportunity of hearing and accordingly restore the disputed issue to the file of the Assessing officer for afresh adjudication on merits and the Bicholim Electricity Employees Cooperative Credit Society Limited. CIT(A) shall provide adequate opportunity of being heard to the assessee and the assessee should also cooperate in submitting the information and the grounds of appeal
of the assessee are allowed for statistical purpose.