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Income Tax Appellate Tribunal, ‘’ SMC’’ BENCH, AHMEDABAD
Before: SHRI WASEEM AHMED
आयकरअपीलीयअधिकरण, अहमदाबादनयायपीी IN THE INCOME TAX APPELLATE TRIBUNAL, ‘’ SMC’’ BENCH, AHMEDABAD BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER आयकरअपीलसं./ITA No. 858/AHD/2023 धििाधरणवरध/Asstt. Year: 2018-2019 Subhagya Co-operative Housing D.C.I.T, Society Limited, Vs. CPC Bangalore B-701 Safal Pegasus, Present Near Auda Garden, Income Tax Officer, Prahladnagar, Ward-5(2)(4), Ahmedabad-380015. Ahmedabad. PAN: AACAS0740E
(Applicant) (Respondent) Assessee by : Shri S.N. Divatia, A.R Revenue by : Ms. Saumya Pandey Jain, Sr. DR सुिवाईकीतारीख/Date of Hearing : 28/12/2023 घोरणाकीतारीख/Date of Pronouncement: 05/01/2024 आदेश/O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:
The captioned appeal has been filed at the instance of the Assessee against the order of the Learned Commissioner of Income Tax (Appeals), Ahmedabad, arising in the matter of rectification order passed under s. 154 of the Income Tax Act, 1961 (here-in-after referred to as "the Act") relevant to the Assessment Year 2018-2019.
The only issue raised by the assesee is that the Ld. CIT(A) denied the claim made u/s 80P of the Act amounting to Rs.4,74,831/- only.
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The necessary facts are that the assessee in the present case is a co- operative housing society and claimed deduction u/s 80P of the Act of Rs. 4,74,831/- in the return file u/s 139 of the Act. However, the deduction claimed by the assessee was denied in the intimation generated u/s 143(1) of the Act, on the reasoning that the relevant columns in the return of income tax were not properly filed up. The assessee against such denial of its claim filed rectification application u/s 154 of the Act which was also denied in the order passed u/s 154 of the Act by observing as under: As seen from the e-filed return of income and rectification filed by you, it is found that you have not correctly filled Sch. VIA for claiming the deduction u/s.80P. The system has computed the allowable deduction under chapter via from the details entered. The other reason for non-allowance of deduction u/s.80P is, the same is not allowable for status other than cooperative society. Further, the said deduction is allowable only on the balance income from business available after set off on the current year and brought forward losses. The assessee should then tick the appropriate box therein, for selecting the rectification reason and then upload the rectification XML-it is suggested that Assessee may use Department Utility for filing correct XML. 4. The aggrieved assessee preferred an appeal to the Ld. CIT(A). The assessee before the Ld. CIT(A) submitted that it has earned interest amounting to Rs. 4,61,012/- on the deposits made with the co-operative society which is liable for deduction u/s 80P(2)(d) of the Act. Likewise, the balance amount of Rs. 13,819/- was claimed deduction under residuary provision i.e. 80P(2)(c)(ii) of the Act. The assesee in support of its claim has also referred to the judgments of Hon’ble Jurisdictional High Court as well as order of the Ahmedabad, Tribunal.
However, Ld. CIT(A) rejected the claim of the assessee on the reasoning that the assessee has not filed up the Income-tax return properly so as to claim the deduction u/s 80P of the Act. As per the Ld. CIT(A), there is an incorrect claim of deduction u/s 80P(2)(d) of the Act on the part of the assessee. Thus, Ld. CIT(A), upheld the order of the AO.
Being aggrieved by the order of Ld. CIT(A), the assessee is in appeal before us.
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The Ld. AR before us filed its return of income and drawn our attention on the computation of income demonstrating that the deduction was claimed u/s 80P(2)(d)/2(c) of the Act. As per the Ld. AR, the deduction cannot be denied merely on the reasoning that the relevant columns in the income tax return were not filled up properly.
On the other hand, the Ld. DR submitted that the scope under the provision of section 154 of the Act is limited to the extent of apparent mistake. In the present case, the assessee has not made a claim properly in the Income-tax return and therefore the same was denied in the intimation generated u/s 143(1) of the Act. As such, there was no mistake apparent on the record which could be rectified under section 154 of the Act. The Ld. DR vehemently supported the order of the authorities below.
We have heard the rival contentions of both the parties and perused the materials available on record. The first controversy arises before us whether the assessee has claimed the deduction u/s 80P of the Act, in the return filed by it electronically. To this effect, we note that the Ld. AR has not brought anything on record to justify whether the proper columns in the income-tax return were filled up properly or not.
9.1 Be that, as it may be, the assessee in the computation of income has duly shown the deduction claimed by it u/s 80P(2)(d)/80P(2)(c) of the Act, which is available on record. Besides, the assessee has also contended before Ld. CIT(A) that the deduction is available to the assessee on the amount of interest income discussed above by virtue of the judgment/ order of Hon’ble Gujarat High Court and ITAT Ahmedabad. The relevant submission of the assessee is reproduced as under: Thus it is clear that the deduction is available to Appellant. In this connection there is a direct decision of Honourable Gujarat High Court (Jurisdictional High Court) in the case of CIT II vs. Sabarkantha District Cooperative Milk Producers Union Ltd Tax Appeal No.
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473/2014 Dated 16.6.2014 (Copy attached Annexure 5). Further in recent judgement by Honurable ITAT (Ahmedabad) on the same facts in the case of Suramya Adobe Co- operative Housing Services Society Limited allowed the claim of the Appellant. Copy of the order attached. (Annexure 6). Further Honourable CIT (A) -3 Ahd. on the same facts in the case of Altius-2 Co. Op. Housing Service Society Limited allowed claim of the Appellant. Copy of the order attached. (Annexure 7). 9.2 The above submission has nowhere been doubted by the Ld. CIT(A). As such, the Ld. CIT(A) has denied the benefit to the assessee merely pointing out the defect in the income-tax return.
9.3 It is the settled position of law that the income has to be computed by the assessee as per the provision of Act. To our understanding, if there is any mistake on the part of the assessee for claiming the legitimate deduction, it is the onus upon the revenue to rectify the same. As such the revenue cannot take the shelter of the ignorance of the assessee by denying the legitimate benefit to the assessee. The Hon’ble Gujarat High Court in the case of Esar Coste vs CIT reported in 276 ITR 165 has held as under: 18. The position is, therefore, that, regardless of whether the revised return was filed or not, once an assessee is in a position to show that the assessee has been over-assessed under the provisions of the Act, regardless of whether the over-assessment is as a result of assessee’s own mistake or otherwise, the CIT has the power to correct such an assessment under section 264(1) of the Act. If the CIT refuses to give relief to the assessee, in such circumstances, he would be acting de hors the powers under the Act and the provisions of the Act and, therefore is duty-bound to give relief to an assessee, where due, in accordance with the provisions of the Act. 9.4 In view of the above, we are of the opinion that the Ld. CIT(A), was bound to follow the verdict of the Hon’ble Jurisdictional High Court. In the event of non- compliance of Hon’ble Jurisdictional High Court, it amounts to a mistake apparent from the record and therefore the same can be rectified u/s 154 of the Act.
9.5 Before parting, it is equally important to note that the none of the authorities below has gone to verify the genuineness of the claim of the assessee whether it was within the provision of law. Thus, for the limited purpose, we are delegating the issue to the file of the AO for fresh adjudication to the extent to find out whether the interest in dispute has been earned from the co-operative
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society and from other sources. As such, the AO shall verify the deduction claimed by the assessee within the provisions of section 80P(d)/80P2(c)(ii) of the Act. Hence, the ground of appeal of the assessee is allowed for the statistical purposes.
In the result, the appeal filed by the assessee is allowed for the statistical purposes.
Order pronounced in the Court on 05/01/2024 at Ahmedabad. Sd/- Sd/-/-/- (T R SENTHIL KUMAR) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER (True Copy) Ahmedabad; Dated 05/01/2024 Manish