Prospective filing under section 80AC(ii) cannot deny section 80P deduction for an earlier assessment year.

A statutory filing condition introduced in section 80AC(ii) with effect from 1 April 2021 could not be applied to assessment year 2019-20, so belated filing of the return did not justify denial of deduction under section 80P. As the return was filed in December 2019, the prospective requirement to file within the time under section 139(1) was not in force for the relevant year. The adjustment made while processing the return under section 143(1) was therefore unsustainable, and the intimation was annulled in favour of the assessee.

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Issues: Whether the denial of deduction under section 80P on the ground that the return was filed belatedly was valid for assessment year 2019-20, when the requirement introduced by section 80AC(ii) applied only from 01.04.2021.

Analysis: The assessment year in dispute was 2019-20 and the return had been filed in December 2019. The requirement that the return must be filed within the time prescribed under section 139(1) was introduced in section 80AC(ii) with effect from 01.04.2021. Since that requirement was not in force for the relevant assessment year, it could not be applied to deny the deduction claimed under section 80P. The adjustment made in the intimation under section 143(1) was therefore unsustainable.

Conclusion: The denial of deduction under section 80P was invalid and the intimation under section 143(1) was annulled in favour of the assessee.

Final Conclusion: The assessee succeeded because the belated-filing restriction in section 80AC(ii) could not be applied to assessment year 2019-20, and the consequential adjustment made while processing the return was set aside.

Ratio Decidendi: A statutory condition introduced with prospective effect cannot be used to deny a deduction for an assessment year to which that condition did not apply.

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