2026 (6) TMI 269

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....-20, date of order 29.01.2026. The impugned order emanated from the order of the C.P.C., Bengaluru (for brevity the 'Ld. AO') order passed under section 154/143(1) the Act date of order 08.10.2020. 2. We heard the rival submission and considered the documents available in the record. The assessee is a society and filed the return by declaring the total income nil. The assessee declared the exempt income in schedule BP of the ITR however, while declaring the same in Schedule EI, the assessee failed to declare the same as exempted income. EI the return was processed u/sec. 143(1) where response was not submitted by the assessee. Hence, the assessee file revised on 21.02.2020 which processed with a demand arise amounting to Rs. 14,05,940/-.....

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.... of the assessee. So the amount Rs. 37,32,640/- was considered as total income and the tax was duly calculated. 4. On perusal of the impugned appellate order we found the Ld. CIT(A) had adjudicated the issue in favour of the assessee. The observation in para no.7.4 to 7.7 of the appellate order is reproduced as below: "7.4 As seen from the facts of the case that the appellant is covered under the principal of mutuality. The appellant has stated that out of total receipts of Rs. 37,32,640/-, Members Contribution is Rs. 26,60,784/- Interest from Member is Rs. 8,81,207/- and Transfer charges are Rs. 88,860/-. All these receipts are covered under principal of mutuality. It is noticed that the appellant has made some clerical mistake....

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.... of the Act. But without issuing any notice of enhancement the Ld. CIT(A) adjudicated the issue and confirmed the addition. In the instant case, the assessee had received interest from Co operative Banks. It is well settled position that the interest earned from cooperative bank by the assessee-trust is admissible deduction u/sec. 80P(2)(d) of the Act. The CPC had allowed the claim of the assessee. 6. The Ld. DR argued and relied on the order of the revenue authorities. 7. We have heard the rival submissions and perused the material available on record. It is an undisputed fact that the CPC, while passing the rectification order under section 154 r.w.s. 143(1) of the Act, had already allowed the deduction claimed by the assessee under....