MASINAN SAMABAY KRISHI UNNAYAN SAMITY,HOOGHLY V. I.T.O., WARD - 23(1), HOOGHLY, HOOGHLY

ITA 1171/KOL/2024

AI Insights

The case involves Masinan Samabay Krishi Unnayan Samity Ltd., a Primary Agricultural Credit Cooperative Society, which appealed against the order of the CIT(Appeals) that dismissed their appeal regarding the disallowance of a deduction claimed under section 80P of the Income Tax Act. The assessee had claimed a deduction of Rs.19,15,024 for the assessment year 2018-19, which was initially allowed but later disallowed by the CPC, leading to a tax charge of Rs.6,69,570. The CIT(Appeals) dismissed the assessee's appeal on the grounds that the deduction was claimed under an incorrect provision (80P(2)(c)(i) instead of 80P(2)(a)(i) and 80P(2)(a)(iv)), which was not considered a mistake apparent from the record. The Tribunal found that the CIT(Appeals) had not considered the appeal on merit and directed a fresh examination.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 473221 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2018-2019
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard
• Section: 154; 80P

Judgement Text

" ITA No. 1171/KOL/2024 (A.Y. 2018-2019) Masinan Samabay Krishi Unnayan Samity Ltd. 1 IN THE INCOME TAX APPELLATE TRIBUNAL, ‘SMC’ BENCH, KOLKATA Before Shri Duvvuru RL Reddy, Vice-President (KZ) I.T.A. No. 1171/KOL/2024 Assessment Year: 2018-2019 Masinan Samabay Krishi Unnayan Samity Ltd.,………………………………………… Appellant Masinanpur, Saidpur, Near Masinan Sakti Sangha, Hooghly-712415, West Bengal [PAN:AAGAM6248K] -Vs.- Income Tax Officer,…………………………....Respondent Ward-23(1), Hooghly, Chinsurah, Hooghly-712102, West Bengal Appearances by: Shri Siddarth Agarwal, Advocate and Ms. Shilpi Mukherjee, Advocate, appeared on behalf of the assessee Sm. Archana Gupta, Addl. CIT, Sr. D.R., appeared on behalf of the Revenue Date of concluding the hearing: January 02, 2025 Date of pronouncing the order: March 18, 2025 O R D E R The present appeal is directed at the instance of assessee against the order of ld. Addl./JCIT(Appeals)-1, Gurugram dated 29th March, 2024 passed for Assessment Year 2018-19. ITA No. 1171/KOL/2024 (A.Y. 2018-2019) Masinan Samabay Krishi Unnayan Samity Ltd. 2 2. Brief facts of the case are that the assessee is a Primary Agricultural Credit Cooperative Society registered under West Bengal Cooperative Society Act. The main activities of the PACS appellant-assessee are purchase and sale of agricultural implement, rural banking and providing credit facilities to its member, who are basically the farmers in rural location are dependent majority on the PACS appellant-assessee for their banking and agricultural development activity. The profit from the above activity of Rs.19,15,024/- for the assessment year 2018-19 from purchase and sale of agricultural implement and rural banking and providing credit facilities are subject to 100% deduction under section 80P of the Act. Therefore, its total income was ‘NIL’. At the time of filing of the return, the deduction of Rs.19,15,024/- inadvertently taken under section 80P(2)(C)(1) of the Act and CPC has been processed the return and disallowed Rs.18,15,024/- and charged tax of Rs.6,69,570/-. Thereafter the assessee filed rectification petition under section 154 of the Act. However, the rectification petition filed by the assessee was dismissed by the ld. Assessing Officer. On being aggrieved, the assessee preferred an appeal before the ld. CIT(Appeals). 3. After considering the submissions of the assessee, the ld. CIT(Appeals) dismissed the appeal filed by the assessee saying that “it is seen from the Form 35 that the appellant has challenged the disallowance of Rs.18,15,024/- on account of deduction inadvertently claimed under section 80P(2)(c)(i) instead of 80P(2)(a)(i) and 80P(2)(a)(iv) which do not come in preview of the mistake apparent from record. The AO, CPC has made the adjustment on the ITA No. 1171/KOL/2024 (A.Y. 2018-2019) Masinan Samabay Krishi Unnayan Samity Ltd. 3 basis of return filed by the appellant and information available in the return of income. Hence this ground is not considerable”. 4. I have heard both the sides. The only grievance of the assessee is that the ld. Addl./JCIT(Appeals) has not considered the case on merit, but he dismissed the assessee’s appeal saying that the scope of rectification is limited to correct the errors of facts or error of law on the basis of material available on record and also the assessee has claimed deduction under section 80P(2)(a)(i) instead of 80P(2)(a)(iv). Therefore, the CPC made the adjustment on the basis of return filed by the assessee. Hence, it cannot be rectified under section 154 of the Act. On this aspect, I am of the view that claiming deduction under wrong provision is not a ground to disallow the claim when the assessee is eligible for deduction under other provision of law. 4.1. So far as the merit of the case is concerned, the ld. Addl./JCIT(Appeals) has not considered the assessee’s appeal on merit. Another contention of the assessee is that in all previous assessment years, the assessee claimed exemption and the Department accepted the deduction under section 80P. Therefore, considering the above facts and circumstances, I am of the view that it is a fit case to remit the matter back to the file of ld. CIT(Appeals) to examine this issue afresh on merit whether the assessee is entitled for deduction under section 80P or not. Hence, the matter is remitted back to the file of ld. CIT(Appeals) with a direction to pass a well-reasoned speaking order on merit after providing opportunity of being heard to the assessee. ITA No. 1171/KOL/2024 (A.Y. 2018-2019) Masinan Samabay Krishi Unnayan Samity Ltd. 4 5. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 18/03/2025. Sd/- (Duvvuru RL Reddy) Vice-President (KZ) Kolkata, the 18th day of March, 2025 Copies to :(1) Masinan Samabay Krishi Unnayan Samity Ltd., Masinanpur, Saidpur, Near Masinan Sakti Sangha, Hooghly-712415, West Bengal (2) Income Tax Officer, Ward-23(1), Hooghly, Chinsurah, Hooghly-712102, West Bengal (3) Addl./JCIT(Appeals)-1, Gurugram; (4) CIT - ; (5) The Departmental Representative; (6) Guard File TRUE COPY By order Assistant Registrar, Income Tax Appellate Tribunal, Kolkata Benches, Kolkata Laha/Sr. P.S. "