2025 (6) TMI 951 - AT - Income Tax

Deduction u/s 80P - denial of claim as assessee has not filed any return of income for the instant assessment year - HELD THAT -There is no whisper of deduction u/s 80P of the Act under sub section 5 of Section 80A of the Act. Besides as perused the provisions of Section 80AC of the Act which provide that while computing the total income of an assessee of any previous year relevant to the assessment year commencing on or after (i) the 1st day of April 2006 but before the 1st day of April 2018 any deduction is admissible under section 80-IA or section 80-IAB or section 80-IB or section 80-IC or section 80-ID or section 80-IE; (ii) the 1st day of April 2018 any deduction is admissible under any provision of this Chapter under the heading C. Deductions in respect of certain incomes no such deduction shall be allowed to him unless he furnishes a return of his income for such assessment year on or before the due date specified under sub-section (1) of section 139. Therefore a perusal of the above provisions of section 80AC(ii) is clear that there is no requirement under the Act to file the return of income to claim deduction u/s 80P of the Act prior to A.Y. 201-19. The instant assessment year before us is A.Y. 2017-18 and accordingly I am of the view that the assessee cannot be denied the deduction u/s 80P of the Act. Accordingly set aside the order of ld. CIT (A) and direct the ld. AO to allow the addition.

Summary

The Appellate Tribunal (ITAT Kolkata) allowed the assessee's appeal for AY 2017-18 against the CIT(A)'s order confirming an addition of Rs. 7,84,470. The issue concerned denial of deduction under section 80P of the Income Tax Act, as the assessee, an agricultural credit cooperative society, had not filed a return of income. The AO disallowed the deduction relying on section 80A(5) and section 80AC of the Act.The Tribunal clarified that section 80A(5) does not mention section 80P, and section 80AC's requirement to file a return to claim deductions applies only from AY 2018-19 onwards. Since the instant year is AY 2017-18, "there is no requirement under the Act to file the return of income to claim deduction u/s 80P." Accordingly, the Tribunal held that the assessee "cannot be denied the deduction u/s 80P" and set aside the CIT(A)'s order, directing the AO to allow the deduction. The appeal was allowed.