DEVANNAGOUNDANUR PACCS LTD.,SALEM V. ITO, WARD-1(6), SALEM

ITA 2996/CHNY/2025

AI Insights

The case involves the Devannagoundanur Primary Agri Coop Credit Society Limited, a cooperative society engaged in providing credit facilities and accepting deposits from its members, which appealed against the orders of the CIT(A) for the Assessment Years 2016-17 and 2017-18. The society had claimed deductions under section 80P of the Income Tax Act, which were denied by the Income Tax Officer (ITO) on the grounds that the society was akin to a cooperative bank and thus fell under the prohibitions of section 80P(4). The CIT(A) dismissed the society's appeals for non-prosecution. The ITAT found procedural improprieties in the CIT(A)'s dismissal and remanded the case for a fresh decision on its merits.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 824678 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-12-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2016-2017
• Appeal Filed On: 28-10-2025
• Other Referred Cases: PCIT vs. Premkumar Arjundas Luthra 279 CTR 614
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R. ANITHA
• Assessee Lawyers: BHUPENDRAN
• Keywords: Condonation of delay
• Section: 143(3)

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH: CHENNAI BEFORE HON’BLE SHRI GEORGE GEORGE K, VICE PRESIDENT AND HON’BLE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER ITA No.2996 & 2997/Chny/2025 Assessment Years: 2016-17 & 2017-18 Devannagoundanur Primary Agri Coop Credit Society Limited, No.421, Devanakavandanur, Salem, Tamil Nadu-637 301. [PAN: AAEAS7657J] Income Tax Officer, Ward-1(6), Salem. Appellant) Respondent Assessee by : Mr.Bhupendran, Advocate. Revenue by : Ms.R.Anitha, Addl.CIT Date of Hearing : 17.12.2025 Date of Pronouncement : 31.12.2025 O R D E R PER INTURI RAMA RAO, A.M : These appeals filed by the assessee – Cooperative Society directed against different orders of NFAC (herein after called CIT(A)’ in short], Delhi, dated 19.11.2024 & 01.08.2025 for AY-2016-17 & 2017-18 respectively. 2.0 Since identical facts and issues are involved in both these appeals, these appeals were heard together and disposed of by this common order. 3.0 For the sake of convenience and clarity, the facts relevant to the appeal bearing ITA No.2966/Chny/2025 for the Assessment Year 2016-17 are stated herein. Printed from counselvise.com ITA No.2996 & 2997/Chny/2025 Page - 2 - of 5 4.0 Briefly the facts of the case are, the appellant is a Cooperative Society duly registered under the Tamil Nadu Cooperative Society Act 1983. It is engaged in the business of providing credit facilities to its members and accepting deposits from its members. It is classified as a primary agricultural credit cooperative society. The return of income for the Assessment Year for 2016-17 was filed on 31.03.2018 disclosing Nil income after claiming deduction u/s 80P of the Income Tax Act. Against the said return of income, the assessment was completed by the Income Tax Officer, Ward-2(2), Salem (hereinafter called ‘AO’) vide order dated 21.12.2018 passed u/s 143(3) of the Income Tax Act at a total income of Rs.44,57,760/. While doing so, the AO had denied the claim for deduction u/s 80P by holding that it is a cooperative bank and hit by provisions of Sub-section-4 of section 80P of the Income Tax Act. 5.0 Being aggrieved by the above assessment order, an appeal was preferred before the CIT(A), who vide impugned order dismissed the appeal for non-prosecution. Being aggrieved, the appellant is in appeal before us. 6.0 At the outset, we find that there is a delay of 270 days in filing the present appeal before this tribunal. The appellant filed an affidavit seeking the condonation of delay on the ground delayed had occurred on account of the fact there was frequent changes in the office of secretary of the society who was responsible for administration of the society. It was further mentioned that soon after the present secretary took the charge of the office on 01.08.2025, immediately the steps were initiated for filing appeal. Printed from counselvise.com ITA No.2996 & 2997/Chny/2025 Page - 3 - of 5 Thus, it is prayed that the delay in filing the appeal is neither intentional nor wanton. Therefore, the delay may be condoned. 7.0 On the other hand, the learned Sr.DR has vehement opposed the condonation of the delay. 8.0 We heard the rival submissions and perused the material available on record. The averments made in the affidavit filed seeking the condonation of delay remain uncontroverted by the learned Sr.DR. In the absence of any material to the contrary, the averments made in the affidavit cannot be brushed aside. Therefore, we are of considered opinion that it is a fit case to condone delay of 270 days. Accordingly, the appeal is admitted for adjudication on merits. 9.0 We heard the rival submissions and perused the material available on record. We find that the CIT(A) dismissed the appeal of the appellant for non-prosecution without entering into the merits of the addition. The CIT(A) without dealing with the contentions of the appellant merely dismissed the appeal in limine for non-prosecution. As contemplated u/s. 250(6) of the Act the CIT(A) is required to frame points of determination followed by a detailed discussion thereupon before passing the order. It is the settled position of law that the CIT(A), even while disposing of the appeal ex-parte, is duty bound to dispose of the appeal on merits. Reliance in this regard can be placed on the decision of the Hon'ble Bombay High Court in the case of PCIT vs. Premkumar Arjundas Luthra 279 CTR 614. Therefore, in Printed from counselvise.com ITA No.2996 & 2997/Chny/2025 Page - 4 - of 5 the light of the above legal position, we are of the considered view that the matter requires to be remanded to the file of the CIT(A) with the direction to dispose of the appeal de novo on merits after affording reasonable opportunity of hearing to the assessee. Accordingly, the appeal of the appellant is stands partly allowed for statistical purposes. ITA No.2997/Chny/2025 for Assessment Year 2017-18 10.0 Since the facts in the present appeal are identical to the facts in the appeal No.ITA-2996/Chny/2025 for the AY-2016-17, the finding given by us shall apply mutatis mutandis. Accordingly, the appeal filed by the assessee – Cooperative society stands partly allowed for statistical purposes. 11.0 In the result, both the appeals of the assessee are partly allowed for statistical purposes. Order pronounced on 31st , December-2025 at Chennai. Sd/- (GEORGE GEORGE K) Vice president Sd/- (INTURI RAMA RAO) Accountant Member Chennai, Dated: 31st , December-2025. KB/- Printed from counselvise.com ITA No.2996 & 2997/Chny/2025 Page - 5 - of 5 Copy to: 1. Appellant 2. Respondent 3. CIT - Chennai/Coimbatore/Madurai/Salem. 4. DR 5. GF Printed from counselvise.com "