2023 (6) TMI 264 - AT - Income Tax

Disallowance of deduction u/s 80P - assessee filed return of income belatedly for beyond prescribed time limit - HELD THAT - As decided in Veerappampalayam Primary Agricultural Cooperative Credit Society Limited case 2021 (4) TMI 1169 - MADRAS HIGH COURT the date of filing of the return of income would be apparent on the face of return and upon a perusal thereof, it would be clear as to whether the return is a valid return, having been filed within the statutory time limit, or a belated one. This is mechanical exercise and one that can be carried out by the CPC, very much within the scope of Section 143(1)(a)(ii) of the Act. AR submitted that Section 143(1)(a)(v) which was introduced on 01.04.2021 cannot be applicable in A.Y. 2019-20 in the present assessee s case as the AO does not have power related to Chapter-VIA Part-C wherein deduction under Section 80P has to be claimed - assessee has admitted that returns were filed belatedly. The assessee should have filed the return within the extended period of due date but the assessee failed to do so. The Assessing Officer thereby issued intimation under Section 143(1) of the Act and has categorically disallowed the deduction under Section 80P of the Act on the ground of belated returns. It appears in Part-A, Schedule 6A of the intimation that return is not within the due date but the fact remains that on merit also the assessee has not taken cognisance of its claim. As assessee filed return belatedly and Section 80AC(ii) of the Act is inapplicable in present case. The CIT(A) was right in denying the claim of assessee that of deduction under Section 80P - Decided against assessee.

Summary

Issues Involved:
1. Deduction under Section 80P and its denial due to late filing of return.
2. Applicability of Section 143(1)(a) for adjustments in belated returns.
3. Interpretation of Section 80AC(ii) in the context of belated returns.

Summary:

Issue 1: Deduction under Section 80P and its denial due to late filing of return

The Assessee, a Co-operative Milk Producers Society, filed its return of income for the Assessment Year 2019-20 on 05.11.2019, beyond the extended due date of 31.10.2019. The CPC, Bangalore, disallowed the entire deduction claim of Rs. 4,61,664/- under Section 80P in the intimation under Section 143(1) on the ground that the return was filed late. The Assessee appealed to the CIT(A), who dismissed the appeal, citing Section 80AC, which mandates that deductions under Part-C of Chapter VI-A are admissible only if the return is filed within the due date.

Issue 2: Applicability of Section 143(1)(a) for adjustments in belated returns

The Assessee argued that the adjustment made under Section 143(1)(a) was not applicable for A.Y. 2019-20 as the relevant provisions came into effect from 01.04.2021. The CIT(A) and the Tribunal noted that Section 143(1)(a)(ii) allows for mechanical adjustments if the return is belated, and this provision was applicable for the relevant assessment year. The Tribunal upheld the CIT(A)'s decision, stating that the CPC was within its rights to disallow the deduction under Section 80P due to the late filing of the return.

Issue 3: Interpretation of Section 80AC(ii) in the context of belated returns

The Tribunal referred to the decision of the Hon'ble Madras High Court in the case of Veerappampalayam Primary Agricultural Cooperative Credit Society Limited, which clarified that no deduction under Part C of Chapter VIA is admissible for belated returns. The Tribunal found that this decision was directly applicable and supported the denial of the deduction under Section 80P. The Tribunal distinguished other cases cited by the Assessee and concluded that the CIT(A) correctly applied the law.

Conclusion:

The Tribunal dismissed the appeal, affirming the CIT(A)'s decision that the Assessee was not entitled to the deduction under Section 80P due to the late filing of the return, in accordance with Section 80AC(ii) and the mechanical adjustments permissible under Section 143(1)(a).