Janaseva Urban Cooperative Credit Society Limited Vs ITO (Bombay High Court)
The Bombay High Court granted interim relief to Janaseva Urban Cooperative Credit Society Limited in a dispute regarding disallowance of deduction under Section 80P of the Income Tax Act, 1961, restraining the Income Tax Department from taking coercive recovery measures.
For the Assessment Year (AY) 2019–2020, the assessment order proposed to add ₹32,16,371 disallowed under Section 80P as business income. The order noted that the petitioner had not filed its return despite conducting transactions totaling ₹8,63,55,868, including cash deposits, time deposits, and interest income. The petitioner argued that there was no finding that this amount constituted its income and highlighted inconsistencies in the computation sheet, which listed ₹8,95,72,239 as income from other sources. The petitioner also submitted that ₹23,49,186 had already been recovered, which exceeded the potential tax liability.
The Court directed that no coercive action be taken against the petitioner for AY 2019–2020 until the next hearing. Regarding AY 2020–2021, the petitioner had filed an appeal and deposited over 20% of the demand; the Court noted that coercive steps should not be taken as per Clause 4 of the CBDT circular dated 29 February 2016. Similarly, for AY 2021–2022, no coercive action was to be initiated until the next hearing.
