Tribunal grants appeal for Cooperative Society, allows deductions under Section 80P, emphasizes no distinction between short/long term deposits.

The Tribunal allowed the appeals filed by the assessee after condoning a delay of 140 days in filing them. It held that the Cooperative Society qualifies for deductions under section 80P(2)(a)(i) of the Income Tax Act, overturning the Assessing Officer's initial decision. The Tribunal also emphasized that there is no legal basis for distinguishing between short term and long term deposits for deduction under section 80P, setting aside the impugned orders and directing a re-examination by the ld. CIT(A) in light of relevant legal precedents.

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Issues:
Delay in filing appeals before the Tribunal, eligibility of deduction u/s.80P(2)(a)(i) for a Cooperative Society, distinction between short term and long term deposits for deduction u/s.80P, setting aside of impugned orders by the Tribunal.

Delay in filing appeals before the Tribunal:
The judgment addresses a delay of 140 days in filing the appeals before the Tribunal by the assessee. The Tribunal, after considering the reasons provided in the affidavit by the assessee, condones the delay and admits the appeals for hearing.

Eligibility of deduction u/s.80P(2)(a)(i) for a Cooperative Society:
The primary issue revolves around the eligibility of a Cooperative Society for deduction u/s.80P(2)(a)(i) of the Income Tax Act. The Assessing Officer (AO) initially held the assessee to be a primary Cooperative Society and denied the deduction under section 80P(4). However, the ld. CIT(A) reversed this decision, allowing various deductions under section 80P(2) for the business activities of the Cooperative Society. The Tribunal concurred with the CIT(A) and held that the assessee qualifies as a Cooperative Society entitled to deductions under section 80P(2).

Distinction between short term and long term deposits for deduction u/s.80P:
A critical aspect of the judgment involves the distinction between short term and long term deposits for the purpose of claiming deductions under section 80P. The Tribunal noted that the ld. CIT(A) allowed deductions for interest incomes except for long term investments/deposits held for more than one year. The Tribunal found no legal provision justifying this distinction and referred to a relevant judgment by the Hon'ble Karnataka High Court. Consequently, the Tribunal set aside the impugned order and directed the ld. CIT(A) to re-examine the matter, considering the absence of a clear distinction between short term and long term deposits for deduction u/s.80P.

Setting aside of impugned orders by the Tribunal:
The Tribunal set aside the impugned orders for all the appeals, directing the ld. CIT(A) to revisit the decisions in light of the absence of a clear legal basis for distinguishing between short term and long term deposits for deduction u/s.80P. The Tribunal emphasized the importance of providing a reasoned order and considering relevant legal precedents, particularly the judgment of the Hon'ble Karnataka High Court. The assessee was granted a reasonable opportunity of hearing in the revised proceedings.

The judgment, delivered by Shri R.S. Syal, Vice President of the Appellate Tribunal ITAT PANAJI, concluded by allowing all the appeals for statistical purposes and setting a date for the order pronouncement in the Open Court on 09th November 2022.

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