2018 (9) TMI 407 - AT - Income Tax

Entitlement to the claim of deduction u/s 80P(2)(a)(i) - no return filed - Held that - It is undisputed that the assessee has not filed return of income for the relevant assessment year. The Hon ble jurisdictional High Court in the case of The Chirakkal Service Co-operative Bank Ltd. & Ors. (2016 (4) TMI 826 - KERALA HIGH COURT), had categorically held that no deduction u/s 80P shall be allowed when no return of income has been filed for a particular assessment year. Since the assessee has not filed the return of income for the relevant assessment year, deduction u/s 80P(2) of the I. T. Act cannot be granted - Decided against assessee.

Summary

Issues:
1. Appeal against CIT(A)'s order dated 21.02.2018 for the assessment year 2011-2012.
2. Claim of deduction u/s 80P(2)(a)(i) of the I. T. Act.

Analysis:
1. The appeal was directed against the CIT(A)'s order for the assessment year 2011-2012. The appellant contended that the assessing officer did not provide a reasonable opportunity to furnish the return of income and address legal formalities, violating principles of natural justice. Additionally, there was ambiguity regarding the assessment of income surplus over expenditure for cooperative institutions. The appellant argued that the assessing officer's failure to consider section 80P(2)(a)(i) for deduction in computing total income was illegal. The appellant sought regularization of the claim for deduction under section 80P(2)(a)(i) and prayed for the appeal to be allowed.

2. The assessee, a cooperative society, did not file its return of income for the assessment year 2011-2012 despite being statutorily liable to do so. Consequently, the assessing officer estimated the total income, leading to an appeal. The only issue before the first appellate authority was the claim of deduction u/s 80P(2)(a)(i) of the I. T. Act. The CIT(A) rejected the appeal, citing the jurisdictional High Court's judgment that no deduction under section 80P shall be allowed if no return of income is filed for a specific assessment year. The Tribunal upheld this decision, emphasizing that since the assessee did not file the return of income, the deduction under section 80P(2) could not be granted based on the precedent set by the jurisdictional High Court.

In conclusion, the Tribunal dismissed the appeal, affirming the decision that the appellant's failure to file the return of income for the relevant assessment year precluded the grant of deduction under section 80P(2) of the Income Tax Act. The judgment highlighted the importance of complying with statutory requirements for claiming deductions and reiterated the precedent set by the jurisdictional High Court regarding the allowance of deductions in the absence of filed returns.