THE KOZHIPPARA SERVICE COOP BANK LIMITED,KOZHIPPARA V. ITO, WARD-5, PALAKKAD

ITA 1158/COCH/2024

AI Insights

The case involves The Kozhippara Service Co-operative Bank Limited, which appealed against the order of the Commissioner of Income-tax (Appeals) that affirmed the disallowance of a deduction under section 80P of the Income Tax Act by the Central Processing Centre (CPC). The assessee argued that it was entitled to the deduction and that the issue was debatable, thus not suitable for adjudication by the CPC during the processing of the return. The CIT(A) dismissed the appeal without adequately addressing the assessee's contentions. The Tribunal found the CIT(A)'s order to be cryptic and not in accordance with the principles of natural justice, leading to the decision to remand the matter back to the AO.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 361075 (ITAT-COCHIN)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-05-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2019-2020
• Other Referred Cases: Mavilayi Service Co-operative Bank Ltd. & Ors. v. CIT & Anr.
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LEENA LAL
• Keywords: Opportunity of being heard

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN Before Shri Inturi Rama Rao, Accountant Member & Shri Prakash Chand Yadav, Judicial Member ITA No.1158/Coch/2024 : Asst.Year 2019-2020 The Kozhippara Service Co- operative Bank Limited 11/139, Kozhippara Palakkad – 678 557. PAN : AAAAT9763E. v. The Income Tax Officer Ward -4 Palakkad. (Appellant) (Respondent) Appellant by : --- None --- Respondent by : Smt.Leena Lal, Sr.AR Date of Hearing : 19.05.2025. Date of Pronouncement : 20.05.2025 O R D E R Per Prakash Chand Yadav, JM : The present appeal of the assessee is arising from the order of the learned Commissioner of Income-tax (Appeals) [“CIT(A)” for short] dated 14.11.2024, having DIN & Order No.ITBA/NFAC/S/250/2023-24/1070364157(1) and relates to the assessment year 2019-2020. 2. The brief facts of the case as coming out from the orders of the authorities below are that the assessee is a primary agricultural co-operative society filed its return of income on 25th September, 2019. The return of income filed by the assessee was declared as defective u/s.139 (9) of the Act. In response to this notice the Counsel removed the defect by ITA No.1158/Coch/2024. The Kozhippara SC.B Ltd. 2 furnishing Form 3CA and 3CD. However, the ld.CPC could not grant the deduction of 80P to the assessee. 3. Aggrieved with the order of the CPC, the assessee filed an appeal before the ld.CIT (A) and pointed out that the assessee is entitled for deduction of sec.80P(2)(a)(i) of the Act and the CPC has erred in disallowing this deduction without providing an opportunity of being heard to the assessee. Another argument of the assessee was that disallowance of deduction u/s.80P is a debatable issue and hence could not have been adjudicated by the CPC while processing the return of income. The ld.CIT (A) simply affirmed the order of the CPC without dealing with the contentions of the assessee. 4. Today, when the matter was called upon for hearing, nobody appeared from the side of the assessee despite service of notice. Therefore, we are deciding this appeal on the basis of the material placed before us. 5. The learned DR relied upon the orders of the authorities below. 6. We have heard the learned DR and perused the orders of the authorities below. Perusal of the order of the CIT(A) would show that the ld.CIT(A) has passed a very cryptic order as evident from the findings recorded by the ld.CIT(A), reproduced hereunder:- “In this case the main ground of appeal relates with disallowance made by the CPC (which is claimed as deduction u/s.80P by the assessee). Since all the grounds pertain to the ITA No.1158/Coch/2024. The Kozhippara SC.B Ltd. 3 same issue, they are taken together for adjudication. On asking the assessee to justify its claim of deduction u/s.80P, the assessee submitted only various case laws with furnishing any proof and details to justify the allowability of deduction u/s.80P. Hence, CPC has rightly disallowed the deduction u/s.80P. Accordingly, these grounds appeal of the assessee is dismissed.” 7. Perusal of these above findings would show that the ld.CIT (A) has not at all dealt with the issue involved and the contentions of the assessee raised before him. It is settled position of law that the CIT (A) is duty bound to decide the appeal in a judicious manner. Considering the facts and circumstances of the case, we hereby restore this matter to the file of the AO to decide the matter afresh in the light of the judgment of the Hon’ble Supreme Court in the case of Mavilayi Service Co-operative Bank Ltd. & Ors. v. CIT & Anr. Reported in (2021) 431 ITR 1 (SC). Needless to say, the AO shall afford meaningful opportunity of being heard to the assessee before passing any order. 8. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on this 20th day of May, 2025. Sd/- (Inturi Rama Rao) Sd/- (Prakash Chand Yadav) ACCOUNTANT MEMBER JUDICIAL MEMBER Cochin; Dated : 20th May, 2025. Devadas G* ITA No.1158/Coch/2024. The Kozhippara SC.B Ltd. 4 Copy to : 1. The Appellant. 2. The Respondent. 3. The CIT, Cochin. 4. The DR, ITAT, Cochin. 5. Guard File. Asst.Registrar/ITAT, Cochin "