2024 (10) TMI 1568 - AT - Income Tax

ITAT Chennai Allows Appeal, Condones Delay, and Emphasizes Cooperative Sector Promotion u/s 80P of Income Tax Act.

The ITAT Chennai condoned a 3-day delay in the filing of an appeal by a Primary Agricultural Coop. Credit Society. The Tribunal set aside the disallowance ... Disallowance of deduction claimed u/s. 80P - non filing of ROI within the due-date u/s. 139(1) - delay in filing of return u/s. 139(1) of the Act was due to belated statutory audit carried out as per the Tamil Nadu Co-operative Societies Act, 1983 on 31.12.2018 - HELD THAT:- Assessee being an Agricultural Cooperative Society registered under the Tamil Nadu Co-operative Societies Act, 1983 had to carry out statutory audit as per the said Act and pursuant to that statutory audit under the Tamil Nadu Co-operative Societies Act, 1983, was over only on 31.12.2018. And the assessee belatedly filed the return on 20.03.2019 and had filed condonation application on 19.03.2019, which is pending before the CBDT. In this context it is noted that in the case of Mavilayi Service Co-operative Bank Ltd. [2021 (1) TMI 488 - SUPREME COURT] held that deduction claimed u/s. 80P of the Act shouldn’t be denied, because, it is benevolent provision enacted by the Parliament to encourage and promote the cooperative sector in general. Therefore, we set aside the impugned order and restore the appeal back to the file of the CIT(A) with a direction to adjudicate the grounds of appeal raised by the assessee (u/s.80P of the Act) after CBDT passes order on the condonation petition filed before it. Appeal filed by the assessee is allowed for statistical purposes. Issues:Delay in filing appeal, Disallowance of deduction u/s. 80P of the Income Tax Act, 1961Analysis:The appeal was filed by the assessee, a Primary Agricultural Coop. Credit Society, against the order of the Learned Commissioner of Income Tax (Appeal) for the Assessment Year 2018-19. The delay of 3 days in filing the appeal was condoned by the Appellate Tribunal ITAT Chennai, as the assessee provided sufficient cause for the delay and the Revenue did not object. The main grievance of the assessee was against the disallowance of the deduction claimed under section 80P of the Income Tax Act, 1961. The assessee's return of income for AY 2018-19 was filed late due to a belated statutory audit conducted under the Tamil Nadu Co-operative Societies Act, 1983. Despite filing a condonation petition before the CBDT and informing the authorities, the claim of deduction u/s. 80P was denied by the CPC and the Ld.CIT(A).The Appellate Tribunal noted that the assessee, being a Co-operative Society registered under the Tamil Nadu Co-operative Societies Act, 1983, had valid reasons for the delay in filing the return. The statutory audit under the said Act was completed on 31.12.2018, and the return was filed on 20.03.2019 after a condonation application was submitted to the CBDT on 19.03.2019. Citing the Supreme Court's decision in Mavilayi Service Co-operative Bank Ltd. & Othrs. v. CIT, the Tribunal emphasized that section 80P is a benevolent provision to promote the cooperative sector. The impugned order disallowing the deduction was set aside, and the appeal was restored to the file of the Ld.CIT(A) with directions to adjudicate the grounds of appeal after the CBDT passes an order on the condonation petition.In conclusion, the appeal filed by the assessee was allowed for statistical purposes, and the decision was pronounced on the 23rd day of October, 2024, in Chennai.