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of <h1>Deduction under section 80P for prior assessment year permitted where section 80AC prospectivity excludes its application, claim to be reconsidered.</h1> The note addresses denial of a Chapter VIA deduction (section 80P) where the return was filed after the due date but in response to a notice. It explains ... Denial of deduction u/s 80P - return was not filed within the due date u/s 139(1) - return of income filed in response to notice u/s 142(1) - AO while invoking the provisions of section 80A(5) and 80AC - HELD THAT:- The provisions of section 80AC of the Act contemplate denial of deduction of certain provisions of Chapter-VIA of the Act if the return of income is not filed by the assessee on or before the due date specified under sub-section (1) of section 139 of the Act. These provisions, introduced from the A.Y. 2018-19 in our opinion, is prospective and hence do not apply to the deduction u/s 80P of the Act in the instant case for the impugned assessment year. Therefore, we are of the considered view that the Revenue is not justified in not entertaining the deduction under section 80P of the Act made by the assessee while filing the return of income forA.Y.2017- 18 on 28.11.2019. Accordingly, we direct the Ld. AO to consider the claim of the assessee u/s 80P as made in the return of income filed on 28.11.2019. Hence, this issue is set aside to the record of the Ld. AO for examination of the amount of claim made by the assessee under section 80P on merits. Appeal of the assessee is allowed for statistical purposes. Issues: Whether a primary agricultural cooperative society can claim deduction under section 80P of the Income-tax Act, 1961 for A.Y.2017-18 where the return claiming the deduction was filed belatedly on 28.11.2019 during assessment proceedings.Analysis: Section 80A(5) requires that a claim for specified deductions must be made in the return of income, but does not prescribe that the return must be filed within the due date. Section 80AC, as amended w.e.f. A.Y.2018-19, conditions certain Chapter-C deductions on filing the return on or before the due date under section 139(1); that amendment is prospective and applies only to assessment years commencing on or after 1 April 2018. For A.Y.2017-18 the amended condition in section 80AC(ii) is not applicable. The assessee made an express claim for deduction under section 80P in the belated return filed during assessment proceedings. The matter was remitted to the Assessing Officer for examination of the claim on merits since the statutory bar introduced from A.Y.2018-19 does not operate retrospectively to deny the 80P claim for A.Y.2017-18.Conclusion: The assessee is entitled to have the deduction under section 80P considered despite filing the return belatedly for A.Y.2017-18; the matter is remanded to the Assessing Officer for adjudication of the claim on merits in accordance with law.Final Conclusion: The appeal is allowed for statistical purposes and the issue of entitlement to deduction under section 80P for A.Y.2017-18 is restored to the Assessing Officer for merits determination.
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