2024 (4) TMI 1111 - AT - Income Tax

Deduction claimed u/s. 80P(2)(a)(i) - claim denied in the intimation u/s. 143(1) stating that the same was not correctly made in the ITR filed - HELD THAT - Considering the object of the society being lending money to its member the deduction is correctly claimed by the assessee in his return of income filed and so the reasons advanced by the revenue on this part has no force and are purely based on surmises and conjecture. Status showing as AOP and not mentioned as cooperative society - As we have gone through the definition of person given in section 2(31) of the Act wherein there is no separate status for co-operative society to mentioned and therefore, the mentioned of the status as AOP also does not disqualify the assessee to claim the deduction. Therefore, denial of the deduction on that second reasons is also not correct. We get the support of our view from the decision of Shree Datta Prasad Sahakari Patsanstha Ltd 2021 (9) TMI 419 - ITAT MUMBAI wherein the bench has dealt the similar issue and allowed the deduction even though the same was not claimed by the assessee in that return of income filed in that case. Whereas, the bench has noted that in this case the assessee has claimed the deduction and therefore, merely without specifying how the claim of the assessee is not correctly claimed and the same cannot be denied in the intimation u/s. 143(1) of the Act. In the light of these set of facts the ld. AO is directed to allow the claim of the assessee as claimed in the ITR u/s. 80P(2)(a)(i) - Appeal of the assessee is allowed.

Summary

Issues Involved:
1. Validity of the order u/s 154/143(1)(a).
2. Disallowance of deduction claimed u/s 80P(2)(a)(i).
3. Alleged non-filing of certain details.

Summary of Judgment:

Issue 1: Validity of the Order u/s 154/143(1)(a)
The assessee challenged the validity of the order u/s 154/143(1)(a) dated 15.04.2021, arguing it was "bad in law and on facts of the case, for want of jurisdiction." The Tribunal noted that the assessee had filed a rectification application under section 154, which was rejected by ADIT, CPC, Bengaluru, on the grounds of incorrect filing of Schedule VIA and incorrect status other than a cooperative society.

Issue 2: Disallowance of Deduction Claimed u/s 80P(2)(a)(i)
The primary issue was the disallowance of deduction claimed u/s 80P(2)(a)(i) on account of interest income. The Tribunal observed that the assessee, a credit cooperative society, had correctly claimed the deduction in the ITR filed. The Tribunal noted that the assessee's status as an AOP (Association of Persons) does not disqualify it from claiming the deduction under section 80P(2)(a)(i). The Tribunal found the revenue's reasons for denial to be "purely based on surmises and conjecture." The Tribunal directed the AO to allow the claim of the assessee as made in the ITR.

Issue 3: Alleged Non-Filing of Certain Details
The Tribunal addressed the allegation that the assessee did not file certain details correctly. It was noted that the assessee had filed its e-Return of Income correctly and fulfilled the required conditions applicable to a cooperative society. The Tribunal found no specific evidence from the revenue to support the claim that the details were incorrectly filed.

Conclusion:
The Tribunal allowed the appeal of the assessee, stating that the deduction claimed u/s 80P(2)(a)(i) was valid and should be allowed. The grounds raised by the assessee were found to be justified, and the orders of the lower authorities were not sustainable.

Order:
The appeal of the assessee is allowed.