Tribunal overturns disallowances, allows depreciation claim under section 80P(2)(d)

The Tribunal allowed the appeal of the assessee, overturning the disallowances made by the lower authorities regarding delay in filing the appeal, eligibility for deduction u/s 80P(2)(d) of the Act, and disallowance of depreciation on fixed assets. The Tribunal directed the AO to allow the depreciation claim, holding in favor of the assessee.

---

---

Issues:
1. Delay in filing the appeal by the assessee.
2. Eligibility for deduction u/s 80P(2)(d) of the Act in respect of dividend income.
3. Disallowance of depreciation on fixed assets and addition u/s 69 r.w.s. 115BBE of the Act.

Delay in filing the appeal:
The appeal in ITA No. 914/Del/2021 for AY 2015-16 was delayed by 639 days due to the transfer of the previous Secretary handling income-tax matters. An affidavit was filed by the present Secretary explaining the delay, which was accepted by the Tribunal, leading to the appeal being admitted for adjudication.

Eligibility for deduction u/s 80P(2)(d) of the Act:
The assessee, a cooperative society, received dividend income and claimed it as exempt u/s 10 of the Act. The Assessing Officer disallowed the exemption, stating that it could only be claimed if dividend distribution tax was paid by the payer. However, the Tribunal found that the issue was already decided in favor of the assessee in previous cases and held that the dividend income from cooperative societies IFFCO and U.P. Cooperative Bank Ltd. was exempt u/s 80P(2)(d) of the Act. The appeal of the assessee on this ground was allowed.

Disallowance of depreciation on fixed assets:
The assessee's claim for depreciation on fixed assets was disallowed by the lower authorities based on a technicality related to the ITR form. Despite a minor error in mentioning the depreciation figure, the Tribunal found that the claim was genuine and properly presented in the return of income. The Tribunal criticized the authorities for disallowing the claim and invoking unrelated provisions, directing the AO to allow the depreciation claim. Consequently, the appeal of the assessee on this ground was allowed.

Final Decision:
The Tribunal allowed the appeal of the assessee, overturning the disallowances made by the lower authorities and directing the AO to allow the depreciation claim. The order was pronounced in the open court on 22.05.2023.

---