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Income Tax Appellate Tribunal, VISAKHAPATNAM “SMC” BENCH, VISAKHAPATNAM
Before: SHRI DUVVURU RL REDDY, HON’BLE
IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM “SMC” BENCH, VISAKHAPATNAM श्री दुव्वूरु आर एल रेड्डी, न्याधयक सदस्य के समक्ष BEFORE SHRI DUVVURU RL REDDY, HON’BLE JUDICIAL MEMBER आयकर अपील सं./I.T.A.No.23/Viz/2023 (ननधधारण वर्ा / Assessment Year : 2019-20) Fishery Survey of India Employees Vs. Income Tax Officer Cooperative Credit and Thrift Ward-1(1) Society Visakhapatnam Fishing Harbour Complex Beach Road, Visakhapatnam [PAN : AAFAT3533M] अपीलधथी की ओर से/ Appellant by : Shri C Subrahmanyam, AR प्रत्यधथी की ओर से / Respondent by : Shri O.N.Hari Prasada Rao, DR सुनवधई की तधरीख / Date of Hearing : 27.04.2023 घोर्णध की तधरीख/Date of Pronouncement : 14.07.2023 आदेश /O R D E R
Per Shri Duvvuru RL Reddy, Judicial Member :
This appeal is filed by the assessee against the order of Commissioner of Income Tax (Appeals) [CIT(A)], National Faceless Appeal Centre (NFAC), Delhi in DIN & Order No.ITBA/NFAC/S/250/2022-23/1048861637(1) dated 17.01.2023 for the Assessment Year (A.Y.) 2019-20, arising out of the order passed u/s 143(1) of the Income Tax Act, 1961 (in short ‘Act’) dated 24.12.2020.
Brief facts of the case are that the assessee, a society registered under the Co-operative Society Act had filed it’s return of income on Fishery Survey fo India Employees Cooperative Credit and Thrift Society, Visakhapatnam 17.11.2020, declaring a total income of Rs.Nil for the A.Y.2019-20, after claiming deduction amounting to Rs.3,94,896/- under Chapter VIA of the Act. The Centralized Processing Centre (CPC) while processing the return for the A.Y.2019-20, assessed the income of the assessee at Rs.3,94,896/- by disallowing the same on the ground that the deduction is claimed u/s 80P, however, the return of income for the year under consideration was not filed within the due date. The assessee filed a rectification request against the aforesaid disallowance dated 25.01.2021 before CPC, Bangalore, however, vide order dated 28.01.2021 u/s 154 of the Act, the AO CPC rejected the claim of the assessee for deduction u/s 80P of the Act.
On being aggrieved, the assessee preferred an appeal before the CIT(A) and the Ld.CIT(A) dismissed the appeal of the assessee, holding that the return of income filed by the assessee society was beyond the due date of filing the return of income, for which no sufficient cause could be adduced by the assessee.
On being aggrieved, the assessee preferred an appeal before the Tribunal by raising the following grounds :
1 . The orders passed under the provisions of section 250 of I.T.Act is contrary to the provisions of law and facts of the case.
Fishery Survey fo India Employees Cooperative Credit and Thrift Society, Visakhapatnam
2. The Ld.Commissioner of Income-Tax (Appeals) (in short ‘CIT(A)’) erred in confirming the action of AO in denying the claim of deduction u/s 80P of the IT Act amounting to Rs.3,94,896/-.
3. The Ld.CIT(A) failed to recognize that assessee did claim the benefit u/s 80P of the IT Act in the return of incoem filed u/s 139(4) of the IT Act, but CIT(A) rejected the benfit stating that the return was not filed u/s 139(1) of the IT Act. In this process, the Ld.CIT(A) failed to take note that section 80P being beneficial section, benefit could not have rejected, especially when the Judicairy considered the return filed u/s 139(4) as equivalent to return filed u/s 139(1) of the IT Act. 4. The Ld.CIT(A), at the first instance, failed to understand that prior to the amendment made by Finance Act, 2021 w.e.f. 01.04.2021, there was no provision incorporated section 143(1) of the IT Act to resort adjustment on the claim fo deduction u/s 80P of the IT Act. Therefore, the impugned order passed by CPC Bangalore u/s 143(1), denying the claim of deduction u/s 80P, is against the provisions of law. 5. The Ld.CIT(A) ought to have understood that assessee was prevented by reasonable cause in filing the Return of Income within the due date prescribed u/s 139(1), and therefore, the action of CIT(A) in confirming the denial of claim u/s 80P of the IT Act is not judicious. 6. The reliance placed by Ld.CIT(A), while dismissing the case of assessee, on the decion of Madras High Court in WP No.7038/2020 is distinguishable on facts of the case. 7. For these and such other submissions that are to be urged at the time of hearing of the appeal, the appellant prays that the claim made by assessee u/s 80P of the IT Act be allowed in the intererst of justice. 5. The only contention of the assessee is that the AO, CPC is not correct in denying the claim of deduction u/s 80P of the Act, which was further upheld by the Ld.CIT(A) injudiciously. The Ld.AR contended that adjustment for disallowance u/s 80P cannot be made while processing the return u/s 143(1), as it is outside the scope of section 143(1). The Ld.AR further contended that claim for deduction u/s 80P cannot be denied for the sole reason that the return was filed beyond the due date Fishery Survey fo India Employees Cooperative Credit and Thrift Society, Visakhapatnam u/s 139(1). The return of income was filed on 17.11.2020, within the exctended time u/s 139(4) of the Act, which is an extension of section 139(1). The Ld.AR further contended that there was no provision incorporated u/s 143(1) of the Act to resort to adjustment on the claim of deduction u/s 80P of the Act prior to the amendment made by Finance Act, 2021 w.e.f. 01.04.2021. Since the assessee’s case relates to the impugned A.Y.2019-20, the Ld.AR submitted that denying the claim of deduction u/s 80P is against the provisions of law. The assessee relied on the following case laws, filed in the paper book and pleaded that the return filed u/s 139(4) within due date is valid and the deduction claimed u/s 80P cannot be denied.
(i) Hon’ble High Court of Telangana in the case of Commissioner of Income-Tax Vs. GVK Industries Ltd., [2023] 147 taxmann.com 281 (Telangana) (ii) Hon’ble ITAT Rajkot Bench in the case of Medi Seva Sahakari Mandali Ltd. Vs. ADIT(CPC) [2023] 146 Taxmann.com 3 (Rajkot – Trib) (iii) Hon’ble ITAT Mumbai in the case of New Ideal Cooperative Housing Society Ltd. Vs. ITO Ward 19(2)(4) vide I.T.A.No.2681/Mum/2019 (iv) Hon’ble ITAT Chandigarh Bench “SMC” in the case of Lanjani Co-operative Agri Service Society Ltd.(CPC) Vs. Deputy Commissioner of Income Tax, [2023] 146 taxmann.com 469 (Chandigarh-Trib)
Fishery Survey fo India Employees Cooperative Credit and Thrift Society, Visakhapatnam
Per contra, the Ld.DR relied on the order of the Ld.CIT(A) and pleaded to uphold the order of the Ld.CIT(A) and dismiss the appeal of the assessee.
I have heard both the parties and perused the material placed on record. It is undisputed fact that the assessee filed the return of income beyond the due date u/s 139(1), but within the due date u/s 139(4), which is an extension of 139(1) and claimed the benefit u/s 80P of the Act. The contention of the assessee is that prior to the amendment made by Finance Act 2021 w.e.f. 01.04.2021, there was no provision incorporated u/s 143(1) of the Act to resort to adjustment on the claim of deduction u/s 80P of the Act. Since the instant case relates to the impugned assessment year 2019-20, the order passed by the CPC, Bangalore u/s 143(1), denying the claim of deduction u/s 80P is against the provisions of law. Now, so far as the deduction u/s 80P is concerned, I have gone through the provisions of section 80AC(ii) amendment, which made it clear that any deduction that is claimed under para ‘c’ of Chapter VI A would be admissible, only if the return of income in that case is filed within the prescribed due date. Therefore, no claim under any of the provisions of para ‘c’ of Chapter VIA would be admissible in the case of belated return. The Ld.CIT(A) dismissed the appeal of the assessee Fishery Survey fo India Employees Cooperative Credit and Thrift Society, Visakhapatnam relying on the decision of Hon’ble High Court of Madras in the case of AA520 Veerappampalayam Primary Agricultural Cooperative Credit Society Ltd. Vs. Deputy Commissioner of Income Tax. [2022] 138 taxmann.com 571 (Madras) (07.04.2021). Similar issue was adjudicated by the Tribunal in the case of Unagatla Large Sized Co-operative Credit Society Ltd., Chagallu Mandal vide I.T.A.No. 255/Viz/2021, dated 08.03.2023 against the assessee, relying on the decision of the Hon’ble High Court of Madras in the case of AA520 Veerappampalayam Primary Agricultural Cooperative Credit Society Ltd.(supra). For the sake of clarity and convenience, I extract relevant part of the order of the Hon’ble High Court of Madras as follows :
“8. The provisions of section 80AC(ii) make it clear that any deduction that is claimed under Part C of Chapter VIA would be admissible only if the return of income in that case were filed within the prescribed due date. Thus no claim under any of the provisions of Part C of Chapter VIA would be admissible in the case of belated return. There is no dispute on this position. The date of filing of a return of income would be apparent on the face of return and upon a perusal thereof, it would be clear as to whether the return is a valid return, having been filed within the statutory time limit, or a belated one. This is mechanical exercise and one that can be carried out by the CPC, very much within the scope of section 143(1)(a)(ii) of the Act. Therefore, the contention of the assessee that the amendment made to section 143(1)(a)(v) is applicable w.e.f. 01.04.2021 has no application in the present case on hand, since the assessee made incorrect claim, according to the decision rendered by the Hon’ble High Fishery Survey fo India Employees Cooperative Credit and Thrift Society, Visakhapatnam Court of Madras. Therefore, the case laws relied on by the Ld.AR has no application to the instant case. Hence, I am of the view that the disallowance u/s 80P of the Act has been rightly made by the CPC and upheld by the Ld.CIT(A). Therefore, the grounds raised by the assessee are liable to be dismissed. In the result, the grounds raised by the assessee are dismissed.
6. In the result, appeal filed by the assessee is dismissed.
Order pronounced in the open court on 14th July, 2023. (दुव्वूरु आर.एल रेड्डी) (DUVVURU RL REDDY) न्याधयक सदस्य/JUDICIAL MEMBER Dated : 14.07.2023 L.Rama, SPS