2023 (5) TMI 910 - AT - Income Tax

Deduction u/s 80P(2)(a)(i) - reasons given by the CIT(A) to deny the claim of deduction u/s 80P was that the assessee society did not file its return of income within the due time as prescribed u/s 139(1) of the Act; and had filed the same only in response to notice u/s 148 -

HELD THAT:- We note that the Hon’ble jurisdictional High Court had an occasion to examining this precise issue in respect of claim of deduction under section 80P of the Act wherein the issue of filing of return belatedly beyond the period stipulated in section 139(1) or section 139(4) of the Act as the case may be, as well as section 142(1) or section 148 of the Act as the case may be was considered at length by even considering section 80A(5)/80AC of the Act and the Hon’ble Kerala High Court (DB) decided the same in the case of Chirakkal Service Co-operative Bank Ltd.[2016 (4) TMI 826 - KERALA HIGH COURT] wherein it has held that the return filed by the assessee beyond the period stipulated u/s 139(1) or 139(4) of the Act was u/s 142(1) or section 148 of the Act need to be accepted by the AO and acted upon in accordance to law.

Thus reasons given by Ld. CIT(A) about the omission on the part of assessee in filing the return of income u/s 139(1)/142(1)/148 of the Act cannot be a ground for these AY’s before us.

Other reason given by the Ld. CIT(A) to deny the claim of deduction under section 80P of the Act claim was that the assessee society cannot be termed as Primary Agricultural Credit Society [PACS] even though, there was a certificate of the Registrar of Co-operative Societies - We note that the AO/Ld. CIT(A) had no benefit of the decision rendered in the case of Malvilayi Service Co-operative Bank Ltd (2021 (1) TMI 488 - SUPREME COURT] - Therefore, in the interest of justice and equity, the issue of claim for deduction u/s 80P(2)(a)(i) of the Act is restored back to file of AO who is directed to examine afresh the claim of assessee in the light of the Hon’ble Apex Court decision in Malvilayi Service Co-operative Bank Ltd (supra). Therefore, the impugned order of Ld. CIT(A) is set aside, and issue is restored back to the file of the AO.

Appeals of the assessee are allowed for statistical purposes.