TaxTMI 
TaxTMI 
2023 (10) TMI 1378
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....essment "records" of the appellant co.op.society is purely on misleading, misconception, arbitrary and perverse observations and hence, being without jurisdiction, bad in law, in-valid, illegal, unwarranted of facts is liable to be quashed. 2. On the facts and in the circumstances of the case as well in law, both the lower authorities have erred in not allowing deduction u/s 80P of the Act to the extent of Rs.2,88,208/- and hence, the order passed under complete misconception, misconstruction and misinterpretation of the relevant provisions of law and facts of the case, is liable to be quashed. 3. On the facts and in the circumstances of the case as well in law, both the lower authorities have failed to appreciate that the appellant being the registered co.operative society engaged in the activity of providing credit facilities exclusively toits members-farmers, duly eligible for deduction u/s 80P(2)(a)(i) and 80P(2)(d) of the Act and hence, the ex-parte order passed by the AO denying the deduction u/s 80P(2)(a)(i) and 80P(2)(d) of the Act is, being without jurisdiction, unwarranted of facts, arbitrary, perverse, bad in law, illegal and invalid, liable to be stuck....
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.... such details are placed on record. The Assessing Officer while passing the assessment order accepted the status of assessee as "Primary Agricultural Co-Operative Credit Society". However, the Assessing Officer denied such deduction under section 80P(2)(a)(i) and 80P(2)(d) by wrongly applying the provision of Section 80A(5). The Assessing Officer denied such deduction on the sole ground that assessee failed to file its return of income as has been recorded in para-6 of assessment order. The assessee before lower authorities explained such difficulties. The ld AR for the assessee submits that the assessee is eligible for deductions claimed under section 80P(2)(a) & (d) and such deduction cannot be denied by the assessing officer for the sole reasons that the assessee failed to file return of income. To support his submissions, the Ld. AR for the assessee relied on the decision of Hon'ble Apex Court in the case of CIT vs. G.M. Knitting Industries (P.) Ltd. [2016] 71 taxmann.com 35 (SC)/[2015] 376 ITR 456 (SC)/[2015] 279 CTR 534 (SC) [24-07-2015] wherein it was held that filing of return of income is directly and not mandatory for claiming deduction under relevant Section of Chapter-V....
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....supported the order of Assessing Officer. The Ld. Sr-DR for the Revenue submits that assessee has not filed return of income. It is the duty of assessee to file return of income and to claim eligible deduction. The Assessing Officer has no power to accept any claim in absence of such claim in the return of income for such claim is made for revised return as has been held by Hon'ble Apex Court in the case of Goetze (India) Limited 284 ITR 323 (SC). He admittedly this is a case where assessee has not filed return of income at all. The Ld. Sr-DR for the Revenue submits that he fully supported the order of lower authorities. 5. I have considered the submission of both the parties and perused the order of lower authorities carefully. I have also deliberated on various case law relied by Ld. AR for the assessee. I find that the Assessing Officer issued notice under section 142(1) to file return of income for assessment year 2017-18. The Assessing Officer recorded that assessee failed to furnish return of income under section 139 in response to such notice. The Assessing Officer further recorded that if assessee failed to comply notice issued under section142(1) of the Act, he will gat....
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....ised by the assessee before assessing officer, therefore, facts related to the issue is emanating from the record of lower authorities, thus, the claim of assessee is admitted. 7. I find that Co-ordinate Benches of Bangalore Tribunal in the case of Prathamika Krishi Pattina, Sahakara Sangha Ltd. (supra) held that provision of Section 80AC which deals with the denial of deduction in respect of certain provision of Chapter VIA, if a returned of income is not filed by assessee, it was held that such provision do not apply to the claim of deduction under section 80P. The relevant part of decision (supra) is extracted below: "7. I have heard the rival submissions. The learned Counsel for the assessee submitted that the provisions of section 80A(5) of the Act will come into play only when a return of income is filed by an assessee and the claim for deduction under Chapter VIA of the Act is not claimed in the said return. It was contended that since the assessee did not file return of income for Assessment Year 2017-18, there was no question of invoking the provision of section 80A(5) of the Act. His further submission was that section 80AC of the Act is it existed prior to it....
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....lowing deduction under section 80P of the Act, for examining afresh by the AO. I therefore allow the appeal of the assessee for statistical purposes." 8. I further find that Co-ordinate Benches of Nagpur Bench in the case of Krushi Vibhag Karmachari Vrund Sahakari Pat Sanstha Maryadit vs. ITO [2023] 147 tamann.com 449 (Nagpur-Trib.) also held that making of claim in return of income under section 80A(5) is directory and the authorities below were not justified in rejecting the claim of assessee under section 80P. The relevant extract is reproduced below: "5. I have heard both the sides and scanned through the relevant material on record. It is an undisputed fact that the assessee did not file return of income for the year under consideration either originally or pursuant to notice u/s 148. Computation of income was filed during the course of assessment proceedings in which the deduction u/s 80P was claimed. Whereas, the authorities below have canvassed a view that the assessee violated section 80A(5) and hence the deduction was not available; the assessee has made out a case that section 80A(5) does not apply where no return is furnished and rather it is section 80AC wh....
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.... sections as given in section 80AC), then the deduction shall not be allowed. A perusal of the mandate of section 80A(5) divulges that the claiming of deduction under various sections of part C of Chapter VI-A in the return of income is essential. The reference in this provision is only to return of income, without any further qualification. The return may be u/s 139(1) or 139(4) or any other relevant section. 9. On a conjoint reading of sections 80A(5) and 80AC, it gets manifest that claiming of deduction under various sections of Part C of Chapter VIA in the return of income is essential. However, an additional requirement for claiming deduction under sections 80-IA or 80-IAB or 80-IB or 80-IC or 80-ID or 80-IE is that such deduction must be claimed in a return filed u/s 139(1) of the Act. In one sense, section 80AC is an exception to section 80A(5), making the mandate of the latter section more stringent in the prescribed cases. Whereas other deductions of Part C of Chapter VIA, including section 80P, can be claimed in the return filed under any section, including section 139(4); the six deductions as referred to in section 80AC must necessarily be claimed in the return....
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....4] 75 Taxman 93/209 ITR 63/119 CTR 94 (Bom.), approved the view of the Hon'ble High Court having the effect that the requirement of filing Form 3AA was a necessary ingredient for claiming additional depreciation, but the timing of filing the Form was a directory requirement, which was fulfilled on filing it even during the course of assessment proceedings. The Hon'ble Bombay High Court in Shivanand Electronics (supra) dealt with the requirement of filing audit report for the purpose of claiming deduction u/s 80J, which required that the report should be filed "along with return of income'' under s. 80J(6A). It held that such requirement of filing the audit report along with the return of income was not mandatory, but directory in the sense that if assessee complied with the same before completion of assessment, deduction under s. 80J, on the basis of such report, was allowable. 12. Recently, the Hon'ble Supreme Court was confronted with the claim of benefit u/s 10B in Pr. CIT v. Wipro Ltd. [2022] 140 taxmann.com 223/288 Taxman 491/446 ITR 1. The assessee furnished original return taking the benefit of section 10B and did not carry forward the loss. Ther....