9911796707
TMI Blog2022 (12) TMI 869X X X X Extracts X X X X X X X X Extracts X X X X ..... ooperative bank is not cooperative society for claiming of deduction u/s 80P(2)(d), whereas various High Court and ITAT Benches have already decided that Cooperative bank is also a cooperative society. 3. On the facts and circumstances of the case, LD PCIT Jaipur-2, Jaipur grossly erred in not considering the decision of Hon'ble Rajasthan High Court in the case of CIT V/S Rajasthan Rajya Sahakari Kray Vikraya Sangh Ltd dated 01-09-2016 in DB IT No 139/2002,20.24 & 27/2004. In this case Hon'ble Rajasthan High Court held that Jaipur Central Cooperative Bank is a cooperative society registered under cooperative society Act and is eligible for deduction under section 80P(2)(d) of the Act. 4. On the facts and circumstances of the case. LD PCIT Jaipur-2, Jaipur grossly erred in holding that A.O. has not verified the issue while completing assessment. From the assessment record it is clear and verifiable that assessing officer allowed the deduction under section 80P(2)(d) after verifying all the documents regarding claim of deduction U/s 80P(2)(d)." 3. The fact as culled out from the records is that the assessee has efiled its return of income on 26.10.2017 declaring total in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment proceedings. This has resulted in order being erroneous and prejudicial to the interest of revenue. During the proceeding u/s. 263 the assessee claimed that the interest received is from the co-operative society, copy of the registration certificate was placed on record. The ld. PCIT observed that any income by way of interest or dividends derived by the co-operative society from its investments with any other co-operative society is exempt. However, the assessee cooperative society has received interest from banks who are not themselves cooperative societies, therefore, the interest received is taxable and deduction u/s. 80(P)(2)(d) is not available to the assessee. Finally, the ld. PCIT has taken a final view which is reiterated here in below: "10. I have gone through the assessment order and case records and submission filed by the assessee, in the facts and circumstances of the case I find that the powers of revision are inherent and PCIT/CIT can use these powers if it notices that any order passed by the AO is not in conformity with the law. 11. From the above facts and circumstances of the case and having regard to the material available on record, the Assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts stated therein are assumed to be correct." 1. Madras High Court in the case of Seshasayee Paper & Boards Ltd. [2000] 242 ITR 490 (Mad.)has held that the powers of the Commissioner are very wide in exercising the powers of revision u/s 263. It is no doubt true that for making a valid order u/s 263, it is essential for the Commissioner to record an express finding that the order sought to be revised was erroneous as well as prejudicial to the interest of the revenue. However, there is nothing in section 263 to show that the Commissioner should in all cases record his final conclusion on the points in controversy before him. The legislative intent to bring the amendment was to make clear the provisions of Explanation to section 263 and to reduce the litigations in this regard which is well supported in view of the clear words used in clause (a) of the Explanation 2 to section 263(1) wherein it is mentioned that the order passed by the AO shall be deemed to be erroneous in so far as it is prejudicial to the interest of revenue, if in the opinion of the PCIT the order is passed without making inquiries or verification which should have been made. If the order is passed without appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 10.10.2019 and 19.11.2019. The same was replied by the assessee vide their letter dated 11.11.2019, the content of the reply is extracted here in below: " 1. Justification on applicability of provision of section 80P:- Sir, we are submitting herewith the computation of total income for the year under consideration for your kind perusal. The assessee has claimed deduction under chapter VIA as follows:- 80P (2)(d) Rs. 54,51,990/- 80P (2)(c)(ii) Rs. 50,000/- Sir, assessee has declared interest received from co-operative bank of Rs. 51,57,590/- and dividend from co operative societies Rs. 2,94,400/-. First one i.e. interest received from co-operative bank are exempt u/s 80P)2)(d) of the Income Tax Act, Certificate of Sikar Kendriya Sahkari Bank Ltd. in respect of interest received on FDR and copy of bank account for interest on saving bank account are submitted herewith for your kind perusal & verification. Likewise assessee has also received dividend of Rs. 2,94,400/- from cooperative society, copy of dividend account is submitted herewith. Copy of audited balance sheet & profit & loss a/c are also submitted in support of our submission. Sir, deduction of Rs. 50,000/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication of mind" and concluded that "during the course of assessment proceedings AO have not verified the claim of deduction u/s. 80(P)(2)(d)". Everything thus hinges on whether assessee's submission being accepted can be faulted with, whether the assessee ought to have produced the appropriate evidence and whether non-recording of the reasons for accepting explanation will render the order erroneous and prejudicial to the interest of the revenue. In fact, there is a specific query and reference of the deduction claimed by the assessee is also founded place in the assessment order. Thus, we are of the considered view that he ld. AO has taken a plausible view which is based on decision relied upon by the ld. AR of the assessee is one of the plausible view and we see that there is no lack of enquiry on the part of Ld. AO. 8. Thus, ld.AO has examined that issue as it is evident form the submission made in the form of paper book filed by the assessee. As the case was for this limited purpose the same has been examined and verified by the ld. AO as it emerges from the findings of the AO. The ld. Pr. CIT evidently did not place on record any apparent error on the part of the AO so a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nquiries, applies his mind to the facts and circumstances of the case and determine the income, the Commissioner of Income-tax, while exercising his power under section 263 of the Act is not permitted to substitute his estimate of income in place of the income estimated by the Assessing Officer. (vii) The Assessing Officer exercises quasi-judicial power vested in his and if he exercises such power in accordance with law and arrive at a conclusion, such conclusion cannot be termed to be erroneous simply because the Commissioner of Income-tax does not fee stratified with the conclusion. (viii) The Commissioner of Income-tax, before exercising his jurisdiction under section 263 of the Act must have material on record to arrive at a satisfaction and (ix) If the Assessing Officer has made enquiries during the course of assessment proceedings on the relevant issues and the assessee has given detailed explanation by a letter in writing and the Assessing Officer allows the claim on being satisfied with the explanation of the assessee, the decision of the Assessing Officer cannot be held to be erroneous simply because in his order he does not make an elaborate discussion in that regar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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