AA520 Veerappampalayam Primary Agricultural Co-operative Society Ltd. Vs ITO (ITAT Chennai)
ITAT Chennai Remands Co-operative Society’s Tax Deduction Case Due to Pending Condonation Petition
Income Tax Appellate Tribunal (ITAT), Chennai Bench, has remitted the appeal of AA520 Veerappampalayam Primary Agricultural Co-operative Society Ltd. back to the Commissioner of Income Tax (Appeals) [CIT(A)] for re-adjudication. The case revolves around the denial of deductions claimed by the co-operative society under Section 80P of the Income-tax Act, 1961, primarily due to the belated filing of its income tax return (ITR) for Assessment Year 2018-19.
The co-operative society had filed its ITR on February 25, 2019, declaring a total income of Nil and claiming deductions under Section 80P(2)(a)(i) and 80P(2)(d) of the Act. However, the Assessing Officer (AO), in the assessment order dated February 27, 2021, disallowed the entire Section 80P claim. The primary ground for disallowance was the delayed filing of the ITR beyond the prescribed due date. Additionally, the AO contended that the society was not eligible for the deduction under Section 80P(2)(d) regarding interest income, as the deposits were made in a co-operative bank rather than co-operative societies, and also held that the assessee is not eligible for deduction under section 80P of the Act for income that is not earned by applying the principle of mutuality.
