Mysore District Judicial Employee Credit Co-operative Society Limited Vs ITO (ITAT Bangalore)
For the AY 2020–21, assessee co-operative society, primarily engaged in providing credit facilities to its members, did not file its return of income within the time either u/s 139(1) or 139(4). Instead, the assessee took recourse to the updated u/s 139(8A) & claimed 80P(2)(a)(i) deduction declaring NIL income after this deduction.
The return filed u/s 139(8A) was held invalid by the CPC vide intimation for the reason that tax as per sec 140B not paid and Part-B-ATI was also not filled. Subsequently, the CPC sought clarification from the assessee regarding the incorrect claim u/s 80P for the reason that return was not filed u/s 139(1). Surprisingly, thereafter, CPC passed intimation u/s 143(1) disallowing the assessee’s claim of deduction u/s 80P(2)(a)(i) .
Though the assessee raised various grounds challenging the action of the CPC, CIT(A) confirmed the disallowances made by the CPC.
Assessee contended before the Tribunal that that once the return has been held invalid, the same cannot be used for drawing any adverse inference against the assessee for processing u/s 143(1).
Tribunal observed that the core issue relates to the disallowance of the assessee’s claim for deduction u/s 80P, as processed u/s 143(1)
