SHRI SAI ARIHANT NAGARI SAHAKARI PATSANSTHA LTD,AHMEDNAGAR vs. ITO, WARD-1, AHMEDNAGAR, AHEMDNAGAR
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Income Tax Appellate Tribunal, PUNE BENCH “SMC”, PUNE
Before: SHRI INTURI RAMA RAO & Ms. ASTHA CHANDRA
PER INTURI RAMA RAO, AM:
This is an appeal filed by the assessee directed against the order of
National Faceless Appeal Centre (NFAC), Delhi dated 11.03.2024 for
the assessment year 2017-18.
Briefly, the facts of the case are that the appellant is a Cooperative
Society formed under the Maharashtra Cooperative Societies Act, 1961.
It is engaged in the business of providing credit facilities to its members
and accepting deposits from them. The Return of Income for the A.Y.
ITA No.722/PUN/2024
2017-18 was filed by the assessee declaring Nil income after claiming
exemption u/s.80P(2)(a)(i) of the Income-tax Act, 1961 (hereinafter
referred to as ‘The Act’). Against the said return of income, the
assessment was completed by the AO vide order dated 15.12.2019
passed u/s.143(3) of the Act at a total income of Rs.30,00,000/-. While
doing so, the AO made disallowance of provision of NPA on Standards
Assets amounting to Rs.30,00,000/- debited to the profit and loss
account rejecting the contention of the appellant society that the said
provision was made in terms of the Circular issued by the Commissioner
of Cooperative Societies mandating the provision for NPAs on the
standard assets.
Being aggrieved, an appeal was filed before the CIT(A), who vide
impugned order confirmed the action of AO disallowing the provision
for NPA on standard assets, however, proceeded to hold that the issue
had become academic in view of the subsequent order passed by the AO
u/s.154 of the Act.
Being aggrieved, the appellant is in appeal before the Tribunal in
the present appeal.
We heard the rival submissions and carefully perused the relevant
material on record. Admittedly, the addition of Rs.30,00,000/- made by
the AO disallowing the provision of NPA on standard assets had become
academic in view of the subsequent order passed by the AO in the
ITA No.722/PUN/2024
proceedings u/s.154 of the Act. In any event, in view of the undisputed
position that the appellant cooperative society is entitled for deduction
u/s.80P(2)(a)(i) of the Act, the addition, if any, also partakes the
character of business income, which qualifies for deduction
u/s.80P(2)(a)(i) of the Act. Accordingly, the appeal filed by the
appellant cooperative society stands allowed.
In the result, the appeal filed by the assessee is allowed.
Order pronounced on this 28th day of May, 2024.
Sd/- Sd/- (ASTHA CHANDRA) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; �दनांक / Dated : 28th May, 2024 Satish
आदेश क� �ितिलिप अ�ेिषत / Copy of the Order forwarded to : अपीलाथ� / The Appellant. 1. ��यथ� / The Respondent. 2. 3. The Pr.CIT concerned 4. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, “SMC” ब�च, पुणे / DR, ITAT, SMC” Bench, Pune. गाड� फ़ाइल / Guard File. 5. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune
