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2023 (1) TMI 893 - AT - Income TaxDeduction u/s. 80(P)(2)(a)(i) - Due date for filing the return of income under Section 139(1) - AO denied the deduction u/s. 80(P)(2)(a)(i) observing that the credit co-operative society is eligible for availing the exemption under Section 80P(20(a)(i) of the Act only if the return of income is filed with the due date - HELD THAT:- A conjoint reading of Section 139(1) of the Act read with the Explanation 2(ii) of the section and Section 63 of the Karnataka Co-Operative Societies Act, 1959 makes it clear that the assessee’s books are required to be audited under the Co-Operative Societies Act, the extended time is available to the assessee upto 31.10.2018 to the file the return of income for the AY 2018- 19. Admittedly in the present case the assessee filed the return of income on 31.10.2018. The assessee cannot be denied deduction under Section 80P(2)(a)(i) of the Act if the assessee filed the return of income on or before 31.10.2018 and the same has been disclosed in the return of income as required in ITR-5 stating that assessee is liable to audit under Cooperative Society Act and mentioned the date of audit in the return of income filed by the assessee. If it is so, the assessee could avail the benefit of circular issued by CBDT cited supra and the assessee has to be granted with the deduction under Section 80P(2)((i)(a). As discussed earlier in the present case assessee has filed return of income on 31.10.2018, which is within the extended time limit in the case of the present assessee whose books are to required to be audited under the relevant Co-operative Societies Act and Explanation 2(ii) of Section 139(1) of the Act is applicable to the assessee’s case. We find no force in the argument of the learned D.R. Accordingly, direct the AO to grant deduction claimed by the assessee under Section 80P(2)(i)(a) of the Act if the assessee establish that it has disclosed the fact that assessee is liable to audit under Cooperatives Societies Act and mentioned the date of furnishing audit report in the return of income filed by the assessee on 31.10.2018 for the impugned AY 2018-19. Accordingly the issue in dispute is remitted to the file of AO for fresh consideration in the light of above observations - Appeal filed by the assessee is partly allowed for statistical purposes.
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