2026 (5) TMI 554

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.... passed by u/s. 250 passed on 19.12.2025 for A.Y. 2018-19 by Addl./JCIT(A), Kochi (for short CIT(A)") upholding the disallowance of deduction u/s 80P(2)(a)(1) and 80P(2)(d) aggregating to Rs. 8.98,716/ on hyper technical ground without giving any opportunity or notice is wholly illegal, unlawful and against the principles of natural justice. 1.2 The Id. CIT(A) has erred in law or on facts in confirming the disallowance u/s 80P without giving any notice or opportunity to rectify the inadvertent and bona fide mistake committed by the data operator of the office of the tax consultant in reporting the said deduction in relevant columns of ITR form. Thus, there was a sufficient cause for the mistake in reporting said deductions. Thus, t....

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....5,740/-. Even the rectification proposed u/s 154 was also rejected by CPC 4. Being aggrieved, the appellant had preferred appeal before NFAC.CIT(A) wherein it had challenged the disallowance of deduction claimed u/s 80P of Rs. 8.98,716/- and the basic deduction of Rs. 50,000/-. The assessee made written submission on 17.01.2025 before NFAC.CIT(A) contending that since the society was engaged in the business of providing credit facility to its members, the interest income received from its members and the interest income from Kheda Dist. Co. Op. Bank were exempt u/s 80P(2)(a)(i) and 80P(2)(d) respectively. However, surprisingly the CIT(A) without pointing out and giving any opportunity, rejected the said appeal on the ground that the appe....

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....cooperative bank which in turn, is a cooperative society itself - Held, yes - Whether exclusion of applicability of section 80P to cooperative banks by section 80P(4) would not disentitle assessee from claiming deduction under section 80P(2)(d) in absence of any amendment in said section - Held, yes - Whether thus, provisions of section 80P(2)(d) would be applicable to instant case and Principal Commissioner was not justified in invoking revisional powers under section 263 which was rightly reversed by Tribunal - Held, yes [In favour of assessee) *** * The controversy sought to be canvassed with regard to deduction under section 80P(2)(d) is no more res integra in view of the decision of this Court in case of Katlary Kariyana Me....

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....refore it cannot be said that cooperative banks are excluded from the definition of cooperative societies by such an amendment. [Para 29] * Moreover, as reliance placed on the aforesaid decision for applicability of section 80P(4) in the facts of the case is also not possible to accept as section 80P(4) would be applicable to the cooperative bank when the cooperative bank is liable to pay tax under the provisions of the Act and in such eventuality, the provision of section 80P would not be applicable as per the amendment of subsection (4) of section 80P. Therefore, the exclusion of applicability of section 80P to cooperative banks by section 80P (4) would not disentitle the respondent-assessee from claiming deduction under section ....