TaxTMI 
TaxTMI 
2018 (7) TMI 747
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....o-operative Societies Act, 1969. It is engaged in the business of providing loans and advances to its members as well as accepting deposits from them. For the assessment years 2012-2013 and 2013-2014, returns of income were filed disclosing loss of Rs. 1,94,61,920 and Rs. 3,01,57,865, respectively. In the returns of income filed, the assessee did not claim deduction u/s 80P of the I.T.Act. According to assessee, the deduction u/s 80P(2) of the I.T.Act could not be claimed since it was not having any positive income. The assessments were completed for assessment years 2012-2013 and 2013-2014 on a total income of Rs. 2,15,49,753 and Rs. 1,83,80,121, respectively. The claim of deduction u/s 80P(2) of the I.T.Act was not considered by the Assessing Officer, for the reason that no such claim was made by the assessee in the returns of income filed by the assessee. 4. Aggrieved by the orders of the assessment completed for assessment years 2012-2013 and 2013-2014, wherein the claim of deduction u/s 80P(2) of the I.T.Act was not considered, the assessee preferred appeals before the first appellate authority. The CIT(A) after referring to the judgment of the Hon'ble jurisdictional High C....
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....the same was filed beyond the time limit prescribed under the Act. The Hon'ble High Court in the case of Chirakkal Service Coop Bank Ltd vs CIT (supra) had held at para 21 that appeals are continuation of assessment proceedings and even if the return of income was filed before the appellate authority claiming deduction u/s 80P(2), the same has to be acted upon. The Hon'ble High Court was considering the following substantial questions of law:- "(B) Whether the Tribunal is justified in denying the exemption under section 80P of the Income Tax Act, 1961, on the mere ground of belated filing of return by the assessee? (C) Whether a return filed by the assessee beyond the period stipulated under section 139(1)/(4) or section 142(1) / 148 can be held as non est in law and invalid for the purpose of deciding exemption under section 80P of the Income Tax Act, 1961?" 7.1 In deciding the above questions, the Hon'ble High Court held as follows:- 19. Section 80A(5) provides that where the assessee fails to make a claim in his return of income for any deduction, inter alia, under any provision of Chapter VIA under the heading "C.- Deductions in respect of certain ....
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....exemption under section 80P of the IT Act on the mere ground of belated filing of return by the assessee concerned. A return filed by the assessee beyond the period stipulated under section 139(1) or 139(4) or under section 142(1) or section 148 can also be accepted and acted upon provided further proceedings in relation to such assessments are pending in the statutory hierarchy of adjudication in terms of the provisions of the IT Act. In all such situations, it cannot be treated that a return filed at any stage of such proceedings could be treated as non est in law and invalid for the purpose of deciding exemption under section 80P of the IT Act. We thus answer substantial questions of law Band C formulated and enumerated above." 7.2 In para 21 of the judgment, the Hon'ble High Court has categorically held that return filed beyond the period stipulated u/s 148 can also be accepted and acted upon provided further proceedings in relation to such assessments are pending in the statutory hierarchy of adjudication in terms of the provisions of the I.T.Act. In view of the above conclusions of the Hon'ble High Court, we direct the Assessing Officer to consider the claim of deduction u....
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....gible for deduction under section 80P of the Act and the grounds raised by the assessee are allowed." 10. Aggrieved by the order of the CIT(A), the Revenue has preferred the present appeal before the Tribunal. The learned Departmental Representative relied on the grounds raised. The learned AR, on the other hand, submitted that the issue in question is squarely covered in favour of the assessee by the judgment of the Hon'ble jurisdictional High Court in the case of Chirakkal Service Co-op Bank Ltd vs CIT (supra). 11. We have heard the rival submissions and perused the material on record. The Assessing Officer had denied the claim of deduction u/s 80P(2) of the I.T.Act since the revised return was filed beyond the time limit prescribed u/s 139 of the I.T.Act. Therefore, it was concluded by the Assessing Officer that in view of the provisions of section 80A(5) of the I.T.Act, the assessee is not entitled to claim of deduction u/s 80P(2). The Hon'ble High Court in the case of Chirakkal Service Co-op Bank Ltd vs CIT (supra) had held at para 21 that appeals are continuation of assessment proceedings and even if the return of income was filed before the appellate authority claiming....
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.... furnish the return and while doing so, could also make claim for deduction referable to section 80P. Not much different is the situation when pre-assessment enquiry is carried forward by issuance of notice under section 142(1) or when notice is issued on the premise of escaped assessment referable to section 148 of the IT Act. This position notwithstanding, when an assessment is subjected to first appeal or further appeals under the IT Act or all questions germane for concluding the assessment would be relevant and claims which may result in modification of the returns already filed could also be entertained, particularly when it relates to claims for exemptions. This is so because the finality of assessment would not be achieved in all such cases, until the termination of all such appellate remedies. Under such circumstances, the Tribunal was not justified in denying exemption under section 80P of the IT Act on the mere ground of belated filing of return by the assessee concerned. A return filed by the assessee beyond the period stipulated under section 139(1) or 139(4) or under section 142(1) or section 148 can also be accepted and acted upon provided further proceedings in rela....