Kerala State Taxes Employees Co Op Society Limited Vs ITO (Kerala High Court)
The Kerala High Court directed the Income Tax Officer (ITO) to consider the petitioner’s rectification application within three months after observing that the delay in filing the income tax return had already been condoned by the competent authority. The petitioner, a co-operative society registered under the Kerala Co-operative Societies Act, 1969, claimed eligibility for deduction under Section 80P of the Income Tax Act. It could not file its return for Assessment Year 2018-19 within the prescribed time due to delay in completing the statutory audit, following which the assessment was completed and the Section 80P deduction was denied.
Subsequently, pursuant to CBDT Circular No. 13/2023 dated 26.07.2023, the petitioner obtained condonation of delay under Section 119(2)(b) of the Income Tax Act. The petitioner then sought consequential relief from the Assessing Officer, but the request was rejected on the ground that no direction had been issued by the appellate or revisional authority. The petitioner thereafter filed a rectification application.
The High Court observed that since the delay in filing the return had been condoned, the principal ground for denying the Section 80P deduction no longer existed and the assessment required reconsideration. Accordingly, the Court directed the Assessing Officer to consider the rectification application, provide the petitioner an opportunity of hearing, and pass appropriate orders in accordance with law within three months.
