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TaxTMI 
TaxTMI 
TaxTMI 
2022 (4) TMI 287
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....unds of appeal raised by the assessee are as follows: "(1) That on facts, and in law, the learned CIT has grievously erred in assuming jurisdiction u/s 263 of the Act. (2) That on facts, and in law, the proceedings u/s 263 are void as the original assessment order was passed u/s 143(3) of the Act after due inquiry and application of mind / and is not erroneous and prejudicial to the interest of the Revenue. (3) That on fact, and in law, the learned CIT has grievously erred in holding that the deduction of Rs. 16,15,315/- u/s 80P(2)(d) of the Act is required to be disallowed." 3. The facts of the case which can be stated quite shortly are as follows: The assessee before us is an urban Co-op. Credit Society engaged in the business of b....
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....proceedings. Thus there was an underassessment of income of the assessee by Rs. 16,15,315/-, therefore assessment order passed u/s 143(3) of the Act on 29.11.2016 in assessee`s case is considered erroneous and prejudicial to the interest of the Revenue. Therefore, ld PCIT directed the assessing officer to recompute and determine the correct total income of the assessee after making disallowance of such wrong claim. 7. Aggrieved by the order of Ld. PCIT, the assessee is in appeal before us. 8. Before us Ld. Authorized Representative (AR) for the assessee submitted that first of all, the assessee did not claim deduction u/s 80P(2)(d) of the Act in respect of disputed amount of Rs. 16,15,315/-, therefore, the jurisdiction exercised by ld PCI....
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....essing officer should not be erroneous. 11. Apart from this, assuming assessee has claimed deduction in respect of interest received from co-operative bank, in that situation, we are of the view that u/s 80P(2)(d) of the Act interest received from co-operative bank are allowable deduction, that is, the deduction is available in respect of interest received from co-operative bank for that reliance can be placed on the order of this co-ordinate Bench, in the case of Bardoli Vibhag GramVikas Co.Op. Credit Society Ltd. vs. Principal Commissioner of income Tax-2,Surat in ITA No. 283/SRT/2019 dated 12.05.2021, wherein the co-ordinate bench held as follows: "9. On merit of the case the learned AR for the assessee submits that the assessee earne....
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....ITA No. 185/SRT/2020 dated 03.03.2021). 10. On the other hand the learned CIT-DR for the revenue supported the order of learned PCIT. The learned DR further submits that the order passed by assessing officer is not only erroneous but it is prejudicial to the interest of revenue as well. The assessing officer simply allowed the deduction under section 80P(2)(d) without discussing the issue in details and the nature of interest earned by assessee on deposit with cooperative banks. The order is not in accordance with the decision of Hon'ble Karnataka High Court Totagars cooperative sales society (second Totagars case) (supra). Thus, the order passed by in allowing deduction under section 80P(2)(d) assessing officer is certainly prejudici....
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....led by the revenue before Tribunal in A.Y. 2009-10, 2010-11 and 2012-13 and the assessee was allowed similar deductions. 13.The Hon'ble Jurisdictional High Court in Aryan Arcade Ltd., vs PCIT (2019) 412 ITR 277 (Gujarat) held that merely because Commissioner held a different belief that would not permit him to take the order in revision, it if further held that when Assessing Officer made full enquiry, he made up his mind, the notice of revision is not valid. (emphasis added by us). Further, Hon'ble Madras High Court in CIT Vs Mepco Industries Ltd., (2007) 207 CTR 462 (Madras) held that when two views are possible on an issue and it is not the case of the Commissioner that the view taken by Assessing Officer is not permissible in ....
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....with co-operative bank. Thus, in view of the aforesaid legal discussion we are of the considered view that order passed by Assessing Officer is not erroneous, though it may be prejudicial to the interest of the Revenue. Therefore, the twin conditions that orders is erroneous and so far as prejudicial to the interest of revenue, as prescribed under section 263 is not fulfilled in the present case. 17.Moreover, we have seen that in assessee's own case for A.Y. 2009-10, 2010-11 and 2012-13, the similar disallowance under section 80P(2)(d) was made by the assessing officer while passing assessment order under section 143(3), however, on appeal before Ld. CIT(A) , the disallowances were deleted and the order of the Ld. CIT(A) in all years were....