Jagruti Nagri Sahakari Patsanstha Myt Parli Vaijnath Vs ITO (ITAT Pune)
In a significant ruling, the Income Tax Appellate Tribunal (ITAT), Pune bench, condoned substantial delays, ranging up to 884 days, in a cooperative society’s appeals against ex-parte assessment and penalty orders. The Tribunal underscored the need for a pragmatic and common-sense approach when considering delays, rather than a strict, pedantic one, drawing upon the principles laid down by the Supreme Court.
The case involved Jagruti Nagri Sahakari Pathpedi Maryadit, a cooperative credit society, which faced adverse orders from the Income Tax Department for Assessment Years 2020-21 and 2018-19. For AY 2020-21, the society’s return, claiming deduction under section 80P, was selected for scrutiny. Due to a lack of response to statutory notices, the Assessing Officer (AO) completed the assessment ex-parte under section 144 of the Income-tax Act, 1961. Significant additions were made, including for high interest expenditure, deduction claimed under Chapter VIA (specifically section 80P), and high liabilities compared to low income. This resulted in a total assessed income of over Rs. 90 lakh against the declared ‘Nil’ income.
Similarly, for another period (referenced in the order as AY 2020-21 but with different figures, suggesting it might pertain to a separate assessment or a clerical error in the source text regarding the assessment year), the assessee’s nil income return with an 80P deduction claim led to a complete scrutiny and subsequent ex-parte assessment under section 144. In this instance, the AO determined the society’s income at over Rs. 1.14 crore.
