2019 (2) TMI 810 - AT - Income Tax

Tribunal Upholds Assessee's Appeal, Rejects Revision on Section 263 - Proper Examination of Deduction

M/s VPT Cargo Handling Division (Traffic Department) Employees Co-operative Credit Society Limited (Earlier known as M/s Dock Labour Board Employees Co-operative Credit Society Ltd.) Versus ACIT Circle-1 (1) Visakhapatnam

M/s VPT Cargo Handling Division (Traffic Department) Employees Co-operative Credit Society Limited (Earlier known as M/s Dock Labour Board Employees ... Issues:1. Delay in filing the appeal.2. Revision u/s 263 regarding deduction u/s 80P for interest income and miscellaneous income.Issue 1: Delay in filing the appealThe appellant filed an appeal against the order of the Pr.Commissioner of Income Tax (Pr.CIT), Visakhapatnam, citing a delay of 37 days in filing the appeal for the Assessment Year (A.Y.) 2012-13. The reason for the delay was attributed to finalization of accounts at year-end, general body meetings, dividend calculations, and distributions. The appellant's condonation petition for the delay was accepted after considering the reasons provided.Issue 2: Revision u/s 263 regarding deduction u/s 80P for interest income and miscellaneous incomeThe Assessing Officer (AO) completed assessments u/s 143(3) after allowing deduction u/s 80P of the Income Tax Act. However, the Pr.CIT initiated revision u/s 263, contending that interest income on savings accounts and miscellaneous income should have been disallowed as they were not earned from society members. The appellant argued that the interest and miscellaneous income were utilized for members' benefit, as per cooperative society regulations. The Pr.CIT set aside the assessments u/s 143(3) and directed a fresh assessment, deeming the original assessment prejudicial to revenue.The Tribunal noted that the AO had examined and allowed the deduction u/s 80P after due verification. It emphasized that any deviation from the AO's order regarding the deduction would constitute a difference of opinion, not an error. Citing a previous case, the Tribunal highlighted that proper verification and adequate examination by the AO were not grounds for revision u/s 263. As the AO had conducted necessary inquiries and made informed decisions on the issues, the Tribunal concluded that there was no basis for invoking revision jurisdiction. Consequently, the Tribunal allowed the appeals of the assessee, finding no error in the assessment order that required modification.In conclusion, the Tribunal allowed the appeals of the assessee, emphasizing that the AO had properly examined and allowed the deduction u/s 80P, thereby rejecting the Pr.CIT's revision under section 263.