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Income Tax Appellate Tribunal, IN THE INCOME TAX APPELLATE TRIBUNAL,
Before: ARUN KHODPIA & ARUN KHODPIA & ARUN KHODPIA
Per C.M.Garg g, JM
This is an appeal filed by the assessee against the or This is an appeal filed by the assessee against the or This is an appeal filed by the assessee against the order of the Pr. CIT, Cuttack dated 29.3.2019 CIT, Cuttack dated 29.3.2019 for the assessment year for the assessment year 2014-15.
The appeal was The appeal was decided by the Tribunal on 13.11.2019. However, decided by the Tribunal on 13.11.2019. However, the appeal was recalled by the Tribunal on 28.2.2022 in M.A. in the appeal was recalled by the Tribunal on 28.2.2022 in M.A. in the appeal was recalled by the Tribunal on 28.2.2022 in M.A. in 23/CTK/2019 for consideration of Ground No.1 as the same was not 23/CTK/2019 for consideration of Ground No.1 as the same was not 23/CTK/2019 for consideration of Ground No.1 as the same was not adjudicated. Hence, we take up the appeal for fresh consideration. adjudicated. Hence, we take up the appeal for fresh consideration. adjudicated. Hence, we take up the appeal for fresh consideration.
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Ground No.1 reads as under:
“ for that on the facts and circumstances of the case, Pr. CIT has erred in law to invoke section 263 by considering the order passed by the AO u/s.143(3) is erroneous and prejudicial to the interest of the revenue when the AO passed the order after due consideration of law and facts. Therefore, invoking jurisdiction u/s,.263 is null and void. Hence, we request to set aside the order passed by the ld Pr. CIT.” 4. Ld A.R. submitted that when the Assessing officer passed order u/s.143(3) of the Act, by considering all the documentary evidences such as audited statement of accounts, as was required by notice u/s.142(1) of the Act, and allowed the deduction of Rs.56,96,017/- u/.s. 80P(2)(d) of the Act, then the order passed by the Pr. CIT is not justified exercising his jurisdiction u/s.263 of the Act. Further, ld A.R. submitted that it is not a case of no enquiry by the Assessing Officer and any new fact has come to the notice of the Ld Pr. CIT. Therefore, the order under section 263 is not justified.
Replying to above, ld CIT DR supported the order of the pr. CIT.
We have heard the rival submissions and perused the record of the case. On perusal of the assessment order, we find that during the course of assessment proceeding, the AO asked the assessee to produce the details of interest earned on the investments with other agencies as shown in the Profit & Loss Account and to explain as to why the interest earned will not be taxed and in compliance of which the assessee submitted a
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reconciled statement showing interest income on investment from various organizations. The AO also accepted the submission of the assessee that the interest earned would be deducted from the total income under the provision of Section 80P(2)(d) of the Act as the interest has been earned from other co-operative societies including cooperative bank and disallowed Rs.533.35 as interest earned from other than co-operative bank. On going through the order passed by the AO, we noticed that the AO has given deduction u/s.80P(2)(d) of the Act to the tune of Rs.56,96,017/- (57,10,378-533) after deducting interest from Vysya Bank, Cuttack of Rs.533.35/-. While going through the financial statements submitted the assessee, which is placed at paper book 53 in Schedule No.12 & 13, the assessee has earned interest from loans and advances, income from investments and other income. It is obvious that for earning income expenditure must be required. In this case, the total profit in the profit and loss account shown by the assessee of Rs.57,10,378/- and assessee has claimed deduction u/s.80P(2)(d) of the Act as stated above. The AO has not enquired as to how much amount is eligible for deduction u/s.80P(2)(d) of the Act and for earning this income how much expenditure has been incurred. The AO has straightway accepted the deduction claimed by the assessee u/s.80P(2)(d) of the Act. The AO is an investigating officer, who ought to have enquired/investigated on account of any deduction/exemption to be accepted by him. The AO should have calculated
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the taxable profit, which is lacking in this case. We have gone through the order of the Pr. CIT, who has after going through the details, has noted that there is a lacuna on the part of the AO for computing exact taxable profit. Therefore, the order passed by the AO is erroneous and prejudicial to the interest of Revenue. In our opinion, the Pr. CIT has given direction on this issue to examine the eligibility of assessee’s claim of deductions u/s. 80P(2)(a)(i) and/or 80P(2)(d) of the Act after giving due opportunity to the assessee. This would meet the ends of justice as the ld AR has submitted that the claim of assessee is allowable either u/s. 80P(2)(a)(i) or 80P(2)(d) of the Act. So let this issue be re-examined at the level of the AO and assessee would also get an opportunity to substantiate its claim by way of relevant legal and factual position. Being so, we do not find any infirmity in the order of the Pr. Commissioner of Income Tax and uphold the same.
In the result, appeal of the assessee is dismissed.
Order pronounced on 17 / 5 /2022.
Sd/- sd/- (Arun Khodpia) (Chandra Mohan Garg) ACCOUNTANT MEMBER JUDICIAL MEMBER Cuttack; Dated 17 / 5 /2022 B.K.Parida, SPS (OS)
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Copy of the Order forwarded to : 1. The Appellant : The Cuttack Credit Co-operative Society Ltd., A.D. Market, Link Road, Cuttack 2. The Respondent. Pr. CIT, Cuttack 3. The CIT(A)-, Cuttack 4. DR, ITAT, Cuttack 5. Guard file. //True Copy//
By order
Sr.Pvt.secretary ITAT, Cuttack
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