Somalwar Academy Education Societies Employees Co-op. Credit Society Mar Vs DCIT (CPC) (ITAT Nagpur)
Belated Return Cannot Deny 80P Deduction – Tribunal Follows Kerala HC Ruling-No 143(1)(a)(v) Power Before 01.04.2021 – Adjustment Held Invalid; ITAT Nagpur allowed the appeal by holding that deduction claimed u/s 80P cannot be denied merely because return was belated.
Assessee, a cooperative credit society, filed its return on 26.03.2019 claiming deduction of Rs. 7,46,340/- u/s 80P. CPC while processing return u/s 143(1) on 04.07.2019 disallowed the claim on the ground that return was not filed within due date u/s 139(1). CIT(A)/NFAC confirmed disallowance, relying on Bombay HC decision in EBR Enterprises Vs. UOI (W.P. No. 1415/2019).
Before Tribunal, Assessee contended that prior to 01.04.2021 there was no enabling provision under s.143(1)(a)(v) to make such adjustment at processing stage. It further relied on Kerala HC in Chirakkal Service Co-op. Bank Ltd. Vs. CIT (68 taxmann.com 298) which held that even belated returns can be considered for deduction u/s 80P, provided assessment proceedings are pending in statutory hierarchy.
Tribunal observed that return filed on 26.03.2019 was available on record when CPC processed the case on 04.07.2019, hence could not be treated as non-est. Following Chirakkal Service Co-op. Bank Ltd., it held that authorities below erred in denying deduction solely for delay in filing return. Accordingly, it allowed the appeal & directed AO to examine Assessee’s claim on merits & compute tax liability accordingly. Thus, the appeal was allowed in favour of the Assessee.
