Case Law Details
Tuticorin Agricultural Producers Co-Op Marketing Society Limited Vs CIT (Appeals) (ITAT Chennai)
The ITAT Chennai considered an appeal filed by a co-operative society against the order of the Commissioner of Income Tax (Appeals), NFAC, for Assessment Year 2020-21. The assessee, registered under the Tamil Nadu Cooperative Societies Act, 1983, had initially not filed its return of income for the relevant assessment year. Based on information received through the insight portal regarding sales reported in GSTR-3B amounting to Rs.11.04 crore, substantial cash deposits in cooperative and SBI bank accounts, and cash withdrawals, proceedings under Section 148A(d) of the Income Tax Act were initiated. Subsequently, notice under Section 148 was issued on 20.02.2024 reopening the assessment.
In response to the notice, the assessee filed its return of income on 20.05.2024 declaring total income of Rs.13,534 after claiming deduction of Rs.41,98,465 under Section 80P(2)(a)(i) of the Act. However, since the return had not originally been filed under Section 139 of the Act, the Assessing Officer denied the deduction claimed under Section 80P. The assessment completed under Sections 147 read with 144B was upheld by the First Appellate Authority.
Before the Tribunal, the assessee submitted that it had already filed a condonation petition dated 17.01.2025 before the Chief Commissioner of Income Tax under Section 119(2)(b) seeking condonation of delay in filing the return under Section 139(1). The assessee argued that the outcome of the condonation application had a direct bearing on the allowability of deduction under Section 80P and therefore requested restoration of the matter to the Assessing Officer pending decision of the competent authority.
The Tribunal observed that the condonation application under Section 119(2)(b) directly affected the assessee’s eligibility to claim deduction under Section 80P. According to the Tribunal, if the competent authority condoned the delay in filing the return, the Assessing Officer would necessarily have to examine the deduction claim on merits. Since the condonation petition was still pending, the Tribunal considered it appropriate to restore the matter to the file of the Assessing Officer with a direction to pass a fresh order after the competent authority decided the condonation application.
Accordingly, the appeal of the assessee was allowed for statistical purposes.
FULL TEXT OF THE ORDER OF ITAT CHENNAI
This appeal filed by the assessee is directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dated 26.11.2025, passed under section 250 of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The relevant Assessment Year is 2020-21.
2. Brief facts of the case are as follows: The assessee is Cooperative society registered under the Tamil Nadu Cooperative Societies Act, 1983. Initially, the assessee society has not filed its return of income for assessment year 2020-21. The Department has received information through insight portal that during the year under consideration, the assessee society has reported total sales under GSTR-3B of Rs.11,04,12,969/- and had also made cash deposits of Rs.10,70,99,400/- in The Thoothukudi District Central Coop Bank Ltd and Rs.59,98,500/- in the bank account maintained with SBI and had also made cash withdrawal of Rs.2,73,46,973/-. Since the assessee had not filed its return of income, order under clause (d) of section 148A of the Act was passed on 19.02.2024. Accordingly, the case was reopened for scrutiny assessment by issuing notice u/s.148 of the Act on 20.02.2024. In response to notice u/s.148 of the Act, assessee filed its return of income on 20.05.2024 declaring total income of Rs.13,534/- after claiming deduction of Rs.41,98,465/-u/s.80P(2)(a)(i) of the Act. Since the assessee has not filed its return of income u/s.139 of the Act, the AO denied the claim of deduction u/s.80P of the Act.
3. Aggrieved by the assessment completed u/s.147 r.w.s. 144B of the Act, the assessee filed appeal before the First Appellate Authority (‘FAA’). After considering the submissions of the assessee, the FAA confirmed the order of the AO.
4. Aggrieved by the order of the FAA, the assessee has filed the present appeal before the Tribunal. The Ld.AR submitted that the assessee has filed a condonation petition dated 17.01.2025 before the CCIT, Chennai u/s.119(2)(b) of the Act praying for condonation of delay in filing return of income u/s.139(1) of the Act and the same is pending. It was submitted that since the condonation petition u/s. 119(2)(b) of the Act before the competent authority has direct bearing, the matter may be restored to the files of the AO to await the decision of the Competent Authority on the condonation application filed in terms of section 119(2)(b) of the Act.
5. The Ld.DR supported the order of the FAA.
6. We have heard rival submissions and perused the material on record. The assessee had approached the Competent Authority u/s.119(2)(b) of the Act for condonation of delay in filing return of income u/s.139(1) of the Act. The assessee’s application for condonation of delay u/s.119(2)(b) of the Act has a direct bearing as regards the claim of deduction u/s.80P of the Act. In event the competent authority condones the delay in filing the return of income filed by the assessee necessarily the claim of deduction u/s.80P of the Act has to be considered on merits by the concerned AO. Since the assessee’s application of condonation of delay in filing the return of income is pending consideration before the Competent Authority, we deem it appropriate to restore the case to the files of the AO. The AO is directed to pass afresh order after the Competent Authority has passed the order regarding the assessee’s petition for condonation of delay in filing the return of income. It is ordered accordingly.
7. In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on 7th April, 2026 at Chennai.
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