Disallowance Of Claim U/s 80P By CPC Prior To Apr 01, 2021 Is Beyond Its Jurisdiction: Kolkata ITAT
Pankaj Bajpai
12 March 2024 7:15 PM IST
On finding that the alleged disallowance by CPC is beyond its jurisdiction as the adjustment towards deduction u/s. 80P of the Income Tax Act came to CPC only from Apr 01, 2021, the Kolkata ITAT interfered with the action of CPC in denying the deduction u/s 80P of the Income Tax Act, 1961.The Bench of the ITAT comprising Sanjay Garg (Judicial Member) and Girish Agrawal (Accountant...
On finding that the alleged disallowance by CPC is beyond its jurisdiction as the adjustment towards deduction u/s. 80P of the Income Tax Act came to CPC only from Apr 01, 2021, the Kolkata ITAT interfered with the action of CPC in denying the deduction u/s 80P of the Income Tax Act, 1961.
The Bench of the ITAT comprising Sanjay Garg (Judicial Member) and Girish Agrawal (Accountant Member) observed that, “section 80AC of the Act puts a bar against claiming of deduction in respect of certain income provided under the head (C) of Chapter VIA which includes section 80P of the Act also if the return of income is not filed before the due date prescribed u/s. 139(1) of the Act. Had it been a case of scrutiny proceeding u/s. 143(3) of the Act, the situation certainly would have been against the assessee subject to the approval by the authorities for condonation of delay in filing the return.” (Para 8)
As per the brief facts of the case, the assessee is a Co-operative Society engaged in the business of providing credit to its members. The assessee is required under law to get its account audited under the rules and regulations of West Bengal Cooperative Societies Act, 2006 by the auditor appointed by Directorate of Cooperative Societies. For the AY 2018-19 due date for filing the return was 31.08.2019. However, the return was submitted on 26.06.2020. The AO made a disallowance of deduction u/s 80P for delay in filing the return of income.
The CIT(A) also confirmed the action of the AO disallowing deduction u/s 80P for delay in filing the return of income.
The Bench noted that the Central Processing Centre denied the deduction u/s. 80P solely for the reason that return was not filed within the due date.
The Bench highlighted the provisions of section 143(1)(a)(v) that “disallowance of deduction claimed under section 10AA or under any of the provisions of Chapter VIA under the heading “C – Deductions in respect of certain incomes”, if the return is furnished beyond the due date specified under sub-section (1) of section 139;”
The Bench observed that before 01.04.2021 there was no mechanism for the CPC to prima facie disallow the claim u/s. 80P.
The Bench further observed that it was only from 01.04.2021 that such powers have been conferred with the CPC to make prima facie disallowance in case of the claim made u/s 10AA or deduction claimed under any of the provisions in Chapter VIA which, inter alia, includes 80P.
Therefore, on finding the alleged disallowance by CPC is beyond its jurisdiction, the ITAT allowed the assessee's appeal.
Counsel for Appellant/Taxpayer: Alokesh Kundu
Counsel for Respondent/Department: Amuldeep Kaur
Case Title: Pairagacha Cooperative Credit Society Ltd. verses Income Tax Officer
Case Number: ITA Nos.669/Kol/2023
