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Facts
The assessee, M/s. Ganpati Industries, claimed a deduction of Rs. 5,24,460/- under Section 80IC of the Income-tax Act, 1961, for the assessment year 2016-17. The lower authorities rejected this claim, citing the assessee's failure to file its return under Section 139(1) of the Act, thereby invoking Section 80AC.
Held
The Tribunal held that the amendment to Section 80AC, which was substituted by the Finance Act, 2018, with effect from 01.04.2018, does not have retrospective application to the assessment year 2016-17. Therefore, the assessee was eligible for the Section 80IC deduction.
Key Issues
The key legal issue was whether the amended Section 80AC, effective from 01.04.2018, could be applied retrospectively to deny a Section 80IC deduction for the assessment year 2016-17 due to non-filing of a return under Section 139(1).
Sections Cited
Section 80IC, Section 80AC, Section 139(1), Section 154
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Income Tax Appellate Tribunal, DEHRADUN “SMC” BENCH, DEHRADUN
Before: SHRI SATBEER SINGH GODARA & SHRI MANISH AGARWAL
This assessee’s appeal for assessment year 2016-17, arises against the Commissioner of Income Tax (Appeals)/Addl/JCIT(A), Udaipur’s order dated 29.07.2025 having DIN and order no. ITBA/APL/S/250/2025-26/1079029347(1), involving proceedings under section 154 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’).
Heard both the parties. Case file perused.
Coming to the sole substantive issue between the parties herein, we note that the learned lower authorities have rejected the assessee’s section 80IC deduction claim of Rs.5,24,460/- in their respective findings for the sole reason that it had failed to file/upload its return under section 139(1) of the Act. The Assessing Officer as well as CIT(A) are of the considered view that the assessee’s impugned deduction claim is barred by section 80AC for want of a valid return under section 139(1) of the Act.
The Revenue’s vehement contention in support of the impugned section 80IC deduction fail to evoke our concurrence. This is for the precise reason that we are in assessment year 2016- 17 whereas the legislature has amended section 80AC of the Act by way of substitution vide Finance Act, 2018 w.e.f. 01.04.2018. There is no material in the case records that this statutory substitution carries any retrospective effect and compliance in the preceding assessment year as well. We thus accept the assessee’s instant sole substantive ground to hold it eligible for the impugned section 80IC deduction in very terms.
This assessee’s appeal is allowed.