Belated return denial under Section 80P remitted for reconsideration in light of CBDT flood-relief instruction.

Deduction under Section 80P had been denied because the return was treated as belated, and the accompanying rectification request under Section 154 was rejected. The tribunal noted a CBDT instruction for Kerala flood-affected taxpayers treating returns and audit reports filed up to the stipulated date as timely under Section 119(2)(b). In view of that instruction, and as the Revenue did not oppose reconsideration on that basis, the rectification issue required fresh examination by the assessing authority. The matter was remitted for reconsideration in light of the CBDT instruction, with partial relief to the assessee.

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Issues: Whether the disallowance of deduction under Section 80P on the ground of belated filing of the return, and the consequent rectification order, required reconsideration in the light of the CBDT instruction issued for Kerala flood-affected taxpayers.

Analysis: The assessee's return for the relevant assessment year had been processed under Section 143(1) and the claim under Section 80P was denied as belated. A rectification application under Section 154 was also rejected. The appellate tribunal noted the CBDT instruction issued under Section 119(2)(b) treating returns and audit reports filed up to the stipulated date as having been filed within time for Kerala taxpayers affected by the floods, and the Revenue raised no objection to reconsideration on that basis. In these circumstances, the rectification issue required fresh examination by the assessing authority.

Conclusion: The matter was remitted for fresh consideration of the rectification in the light of the CBDT instruction, with the assessee obtaining partial relief.

Final Conclusion: The denial of deduction was not finally sustained on the existing rectification record, and the controversy was sent back for reconsideration in accordance with the CBDT instruction.

Ratio Decidendi: Where a statutory deduction has been denied solely on the footing of belated filing, and a later administrative instruction potentially treats the return as timely filed for the relevant class of taxpayers, the rectification issue must be reconsidered on that legal basis.

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