VISHWAKARMA SUVARNAKAR SA HAKARI PATSANSTHA LTD KOLHAPPUR,KOLHAPUR vs. ITO, WARD 1(1), KOLHAPUR

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ITA 496/PUN/2024Status: DisposedITAT Pune20 June 2024AY 2018-19Bench: SHRI SATBEER SINGH GODARA (Judicial Member), SHRI INTURI RAMA RAO (Accountant Member)4 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal noted that the NFAC had already treated the assessee as eligible for Section 80P deduction. Therefore, the disallowances that increased the business income should also be eligible for deduction, following CBDT Circular No. 27/2016.

What were the facts?

The assessee, a cooperative society, appealed against the disallowance of deduction under Section 80P by the NFAC. The disallowances included expenses under Section 40(a)(ia), income chargeable under Section 28, income tax paid, and provision for bad debts.

What were the issues?

Whether disallowances made by the AO, which increase the business income, should be considered for Section 80P deduction when the assessee is otherwise eligible.

Which sections of the Income-tax Act were involved?

Section 80P,Section 40(a)(ia),Section 28

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE “B” BENCH : PUNE

Before: SHRI SATBEER SINGH GODARA & SHRI INTURI RAMA RAO

Hearing: 20.06.2024Pronounced: 20.06.2024

the “NFAC”] Delhi’s Din and Order No. ITBA/NFAC/S/250/ 2023-24/1060907326(1), dated 14.02.2024, in proceedings u/s.143(3) of the Income Tax Act, 1961 (in short “the Act”).

Case called twice. None appears at assessee’s behest. It is accordingly proceeded ex-parte.

2.

The assessee pleads the following substantive grounds in the instant appeal :

2 ITA.No.496/PUN./2024

1.

“On the facts and circumstances of the case and in law the CIT(A), NFAC erred in confirming the disallowance of deduction u/s.80P in respect of the following additions

made by the AO to it’s business income, ignoring the instructions in CBDT Circular No.37/2016 dated

02.11.2016.

Sr.No. Provisions/Expenses Amount (Rs.) 1. Disallowance of expenses under 3,252 section 40(a)(ia) 2. Income chargeable under section 28 1,12,461 3. Income tax paid under section 40a 13,990 4. Provision for Bad Debts 2,20,296 TOTAL 3,49,999

The appellant craves leave to add to, amend, alter, delete or modify all or any of the above ground of appeal or raise a new ground of appeal before or at the time of hearing.”

3. We next note that the NFAC’s impugned lower appellate discussion affirming the assessment findings disallowing the foregoing heads read as under :

3 ITA.No.496/PUN./2024

4.

Learned DR could hardly dispute the fact that the NFAC’s lower appellate discussion has already treated the assessee as eligible for sec.80P deduction. That being the clinching case, we find force in the assessee’s sole substantive ground raised herein placing reliance on the CBDT’s circular no.27/2016 that such disallowance(s) as the one in hand before us lead to increases the quantum of regular business income itself; which in turn has already eligible for deduction.

Faced with the situation, we accept the assessee’s instant sole substantive grievance in very terms. Necessary computation shall follow as per law.

5.

This assessee’s appeal is allowed in above terms.

4 ITA.No.496/PUN./2024 Order pronounced in the open Court on 20.06.2024.

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