MAHATMA FULE GRAMIN BIGAR SHETI SHAHAKARI PATSANSTHA MARYADIT,KHED vs. ITO WARD8(3), PUNE

This appeal by the assessee pertaining to Assessment Year 2019-20 is directed against the order of ld. Addl/JCIT(A)-1, Guwahati dated 14.06.2024 passed u/s.250 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) which inturn is arising out of the Intimation Order passed u/s.143(1) dated 28.05.2020.

At the outset, I find the appeal is time barred by 78 days before the Tribunal. The assessee has filed an affidavit stating that CEO Mr. Sanket Satkar who was looking after the Administrative matters of the Society left the job and the Management is looking out for appointment of new CEO. This is the precise reason which led to delay in filing the appeal.

Having gone through the averments made in the affidavit and in the absence of anything contrary to disbelieve the assessee’s version made therein, I am of the opinion that there was ‘reasonable cause’ which prevented the assessee in filing the appeal before the Tribunal within the stipulated time. I therefore in the larger interest of justice condone the delay of 78 days and proceed for adjudication of appeal.

Briefly stated, the facts of the case are that the assessee is a Cooperative Credit Society engaged in the business of providing credit facilities to its members. The assessee filed the return of income u/s.139(4) of the Act for the A.Y. 2019-10 on 18.02.2020 declaring Nil income, after claiming deduction u/s.80P of the Act at Rs.11,03,998/-. The CPC vide its intimation dated 28.05.2020 disallowed the said claim.

Aggrieved assessee preferred appeal before the ld.Addl/JCIT(A) challenging the intimation order but with a delay of 1139 days. It was contended that the assessee was pursing the alternate remedy available to it by way of rectification application and hence the delay occurred. It was also contended that CPC was incorrect for the reason that clause covering all deductions under Chapter VI is inserted in section 143(1)(a)(v) w.e.f. A.Y. 2021-22, therefore, such adjustment of disallowing section 80P deduction if return is not filed before the due date prescribed u/s.139(1) is not permitted in the A.Y. 2019-20. However, the ld. Addl/JCIT(A) invoking the provisions of section 249(2) dismissed the appeal, without condoning the delay.

Now the assessee is in appeal before the Tribunal

I have heard the parties and perused the record placed before me. On perusal of the impugned, order, it is pertinent to mention that the assessee filed the appeal before the ld.Addl.JCIT(A) with a delay of 1139 days. Primarily, the moot point under consideration is as to whether such a long delay deserves condonation. At this stage, it is relevant to note the judgment of the Hon’ble Bombay High Court in Vijay Vishin Meghani Vs. DCIT & Anr (2017) 398 ITR 250 (Bom) holding that none should be deprived of an adjudication on merits unless it is found that the litigant deliberately delayed the filing of appeal. In that case, delay of 2984 days crept in due to improper legal advice. Relying on Concord of India Ins. Co. Limited VS Nirmala Devi (1979) 118 ITR 507 (SC), the Hon’ble jurisdictional High Court condoned the delay.

In yet another case in Anil Kumar Nehru and Another vs. ACIT (2017) 98 CCH 0469 BomHC, there was a delay of 1662 days in filing the appeal. Such a delay was not condoned by the Hon’ble High Court. In further appeal, condoning the delay, the Hon’ble Supreme Court in Anil Kumar Nehru vs. ACIT (2018) 103 CCH 0231 ISCC, held that : `It is a matter of record that on the identical issue raised by the appellant in respect of earlier assessment, the appeal is pending before the High Court. In these circumstances, the High Court should not have taken such a technical view of dismissing the appeal in the instant case on the ground of delay, when it has to decide the question of law between the parties in any case in respect of earlier assessment year. For this reason we set aside the order of the High Court; condone the delay for filing the appeal and direct to decide the appeal on merits.’

Turning to the facts of the instant appeal, we find that the legal issue of passing the ex parte order dismissing the appeal at the threshold stage has merits in favour of the assessee. Considering the principles enunciated in the above judicial precedents, I am of the view of the delay of 1139 days deserves condonation for paying way to render substantial justice.

Coming to the issue on merits, the issue arises for my consideration is whether the CPC was justified in denying the deduction claimed by the assessee u/s.80P of the Act for filing the return belatedly. I note that the amendment carried out in Finance Act, 2021 w.e.f. 01.04.2021 with respect to allowing of deduction u/s.80P of the Act is prospective in nature. Admittedly, the assessment year under consideration is 2019- 20. In support of its contention, the ld. Counsel for the assessee drew the attention of the Bench to the decision of Coordinate Bench of the Tribunal in the case of Finolex Industries Ltd. Employees Co-o. Credit Society Ltd. Vs. ITO in dated 03.04.2023 wherein the issue was decided in favour of the assessee by observing as under :

On perusal of the above, I find that the facts of the above case are identical to the instant case of assessee. Following the decision of the Coordinate Bench of the Tribunal (supra), I hold that CPC was not justified in disallowing the deduction claimed by assessee u/s.80P of the Act for A.Y. 2019-10 as the powers for doing so were brought into the Act from A.Y. 2021-22. I therefore reverse the impugned order of the lower authorities and direct the Assessing Officer to allow the deduction claimed by the assessee u/s.80P of the Act. Grounds raised by the assessee are allowed.

In the result, the appeal of the assessee is allowed.