AVANTIKA BUNKAR SAHKARI SAMIITI MARYADIT ,CHANDERI vs. DCIT CPC, BANGLORE

This appeal by the assessee is directed against the order dated 03.09.2021 of Commissioner of Income Tax(Appeal), National Faceless appeal Centre, Delhi for Assessment Year 2018-19. The assessee has raised following grounds of appeal:

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Avantika Bunkar Sahakari Samiti Page 6 of 9 of provision of section 143(1)(a) to disallow the claim of deduction u/s 80P on the ground of delay in filing return of income. In support of his contention he has relied upon the following decisions:

1.Shri Nava Ujala Seva Sahakari Mandali Ltd. vs. DCIT/ ACIT (CPC) 2022 (11) TMI 128 (ITAT Rajkot) 2. Lanjani Co-operative Agri Service Society Ltd. vs. DCIT (CPC) (2023) 146 taxmann.com 468 (Chandigarh-Trib.) 3. Medi Seva Sahakari Mandli Ltd. vs. ADIT (CPC) (2023) 146 taxmann.com 3 (Rajkot-Trib.) 4. Aliudepur Seva Sahakari Mandli Ltd. & Others vs. ADIT (CPC) 2023 (2) TMI 1115 (ITAT Rajkot) 5. The Khedbrahma Taluka Primary Teachers Co-op. Credit Society Ltd. vs. ADIT (CPC) 2023 (2) TMI 749 (ITAT Ahmedabad) 6. Sri Kodandaramaswamy Primary Agricultural Co-operative Society Ltd. vs. Income Tax Officer, Ward-2 2023 (1) TMI 572 (ITAT Hyderabad) 7. Trustees of Tulsidas Gopalji Charitable and Chaleshwar Temple Trust vs. Commissioner of Income Tax (1994) 207 ITR 368 (Bombay High Court) 8.Income Tax Officer-3(4) vs. M/s. Uma Developers 2016 (9) TMI 992 (ITAT Mumbai) 9.Late Hussein Ismail Dawoodani vs. DCIT 2018 (11) TMI 1885 (ITAT Mumbai)

Avantika Bunkar Sahakari Samiti Page 7 of 9 6. I have considered the rival submission as well as relevant material on record. The only controversy in this appeal is denying the claim of deduction u/s 80P of the Act while processing the return of income u/s 143(1) by the CPC on the ground that the assessee has filed the return beyond the due date of filing the return of income u/s 139(1) of the Act.

“7.1 A joint reading of the above provisions makes it evident that the claim of deduction under section 80P of the Act cannot be allowed the assessee, if the assessee does not file its return of income within the due date stipulated under section 139(1) of the Act w.e.f. assessment year 2018-19 onwards. However, we also note that amendment has been introduced in section 143(1)(a)(v) of the Act to provide that the claim of deduction under section 80P of the Act can be denied to the assessee, in case the assessee does not file its return of income within the time prescribed under section 139(1) of the Act with effect from 01-04-2021 and does not apply to the impugned assessment year i.e. assessment year 2019-20 relevant to financial year 2018- 19. Accordingly, in our considered view, denial of claim under section 80P of the Act would not come within the purview of prima facie Page 7 of 9

Avantika Bunkar Sahakari Samiti Page 8 of 9 adjustment under section 143(1)(a)(v) of the Act, for the simple reason that the section was not in force during the period under consideration i.e. assessment year 2019-20. 7.2 The second issue for consideration is that whether the case of the assessee would fall within the purview of prima facie adjustment under section 143(1)(a)(ii) (an incorrect claim, if such incorrect claim is apparent from any information in the return). In our view, the scope of the adjustments that can be made under the said provision has been elaborated in the Explanation to the aforesaid section, which does not include denial of deduction claimed by the assessee in case the assessee does not furnish its return of income within the date stipulated under section 139(1) of the Act. The Explanation to the said section specifically provides for cases/instances when the claim made by the assessee could be said to be “incorrect”. Therefore, in our considered view, the case of the assessee would also not fall within the purview of prima facie adjustment under section 143(1)(a)(ii) (an incorrect claim, if such incorrect claim is apparent from any information in the return). We also observe that the counsel for the assessee has filed copies of orders passed by Commissioner (Appeals), NFAC in many other cases of cooperative societies having similar issues, in which it has been held that section 143(1)(a)(ii) of the Act does not deal with disallowance of deduction for deed filing of return of income and also the said adjustment is not permissible under section 143(1)(a)(v) of the Act. 7.3 We note that in the case of Chirakkal Service Co-Operative Bank Ltd. Kannur v. CIT 2016] 68 taxmann.com 298 (Kerala), the Kerala High Court held that a return filed by assessee beyond period stipulated under section 139(1) or 139(4) or under section 142(1) or section 148 can also be accepted and acted upon for entertaining claim raised under section 80P provided further proceedings in relation to such assessments are pending in statutory hierarchy of adjudication in terms of provisions of Act. In the case of ASR Engg. & Projects Ltd. [2019] 111 taxmann.com 49 (Hyderabad - Trib.), the ITAT held that to be eligible to make claim under section 80-IA or any other section of Chapter VI A, assessee should have filed return of income under section 139(1) and even if it did not make claim for deduction in original return and subsequently file revised return making such claim, its claim for deduction under section 80-IA is maintainable. Therefore, where assessee had filed return under section 139(1), it was entitled to claim deduction under section 80-IA even if such claim was not made in original return but subsequently in revised return filed in response to notice issued under section 153A. 7.4 We note that the instant case, there was a few-month delay in filing the return of income by the assessee for the assessment year 2019-20 and return of income was filed within due date permissible u/s 139(4) of the Act, in which the claim for deduction u/s 80P of the Act was made. Therefore, looking into the totality of facts, we are of the view that claim of deduction u/s 80P of the Act cannot be denied to the assessee only on the basis that the assessee did not file return of income its return Page 8 of 9

Avantika Bunkar Sahakari Samiti Page 9 of 9 of income within due date u/s 139(1) of the Act , in light of the discussion and judicial precedents highlighted above. Therefore, in the interests of justice, we are restoring the case to the file of the Ld. CIT(Appeals) for fresh adjudication on merits of the case after giving due opportunity of hearing to the assessee.”

Order pronounced in the open court on 12.05.2023.