THE VADGAON JANATA CO OPERATIVE CREDIT SOCIETY LIMITED,VADGAON V. INCOME TAX OFFICER, ICHALKARANJI

ITA 1308/PUN/2025

AI Insights

The case involves The Vadgaon Janata Co-operative Credit Society Limited, which appealed against the order of the Principal Commissioner of Income Tax (PCIT), Pune-1. The PCIT had set aside the original assessment order that allowed the society a deduction under section 80P(2) of the Income Tax Act for the assessment year 2018-19. The PCIT's action was based on the grounds that the society did not file its return within the time limit prescribed under section 139(1) of the IT Act, as required by the amended section 80AC, which is a prerequisite for claiming deductions under section 80P. The Tribunal dismissed the appeal, agreeing with the PCIT that the original assessment was erroneous and prejudicial to the interests of the revenue.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 773184 (ITAT-PUNE)
• Duration Of Justice: 4 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-09-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2018-2019
• Appeal Filed On: 21-05-2025
• Other Referred Cases: Chirakkal Service Cooperative Bank vs. CIT, Sanchar Gramin Bigarsheti Sahakari Patsanstha Maryadit
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AMIT BOBDE
• Assessee Lawyers: PRAMOD S. SHINGTE
• Keywords: Assessment record; Revision of order
• Section: 147; 148; 143(3); 142(1); 154; 263; 6

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “B”, PUNE BEFORE SHRI MANISH BORAD, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA No.1308/PUN/2025 िनधाᭅरण वषᭅ / Assessment Year : 2018-19 The Vadgaon Janata Co- operative Credit Society Limited, Main Road, Peth Vadgaon, Near Abaji Putala, Tal. Hatkanangale, Kolhapur- 416112. PAN : AABTT2018E Vs. ITO, Ward-1, Ichalkaranji. Appellant Respondent आदेश / ORDER PER VINAY BHAMORE, JM: This appeal filed by the assessee is directed against the order dated 27.03.2025 passed u/s 263 of the IT Act by Ld. PCIT, Pune-1 [‘Ld. PCIT’] for the assessment year 2018-19. 2. The appellant has raised the following grounds of appeal :- “1. The Principal Commissioner of Income Tax 1, Pune (hereinafter referred to as the PCIT) erred in passing order u/s 263 holding the assessment order dated 19.03.2023 passed by the AO, NFAC Assessee by : Shri Pramod S. Shingte Revenue by : Shri Amit Bobde Date of hearing : 31.07.2025 Date of pronouncement : 25.09.2025 Printed from counselvise.com ITA No.1308/PUN/2025 2 allowing deduction u/s 80P as claimed by the appellant, to be erroneous and prejudicial to the interest of the revenue. The appellant submits as under, without prejudice to each other: a. The order having been passed by the AO after due consideration of submission of the appellant in respect of eligibility of the deduction u/s 80P and hence the order passed by the PCIT u/s 263 is beyond jurisdiction and therefore incorrect. b. The appellant being entitled for the deduction; it is incorrect on the part of the PCIT to hold the assessment order to be erroneous and prejudicial to the interest of the Revenue. The appellant prays that the order of the PCIT be quashed. The appellant craves leave to add to, amend, alter, delete or modify all or any of the above ground of appeal or raise a new ground of appeal before or at the time of hearing.” 3. Facts of the case, in brief, are that the assessee is a credit co-operative society engaged in the business of providing credit facilities to its members and accepting deposits from them. On the basis of information that the assessee has made various cash transactions in his bank accounts but return of income has not been filed, his case was reopened u/s 147 of the IT Act and notice u/s 148A(b) of the IT Act was issued and the order u/s 148A(d) was passed and consequently notice u/s 148 of the IT Act was also issued on 31.03.2022. In response to the notice u/s 148, the assessee filed income tax return on 28.04.2022 declaring Nil income after claiming deduction of Rs.6,08,353/- u/s 80P(2) of the IT Act. Printed from counselvise.com ITA No.1308/PUN/2025 3 The statutory notices u/s 143(2) and 142(1) were issued to the assessee along with questionnaire. After considering the reply of the assessee, the Assessing Officer vide order dated 19-03-2023 completed the assessment u/s 143(3) r.w.s. 147 r.w.s. 144B of the IT Act by accepting the income returned by the assessee. It is worthwhile to mention here that in the body of assessment order nothing was mentioned with regard to deduction u/s 80P(2) of the IT Act, however in the computation sheet annexed with the assessment order the Assessing Officer allowed the deduction under Chapter VI-A regarding 80P(2) of the IT Act of Rs.6,08,353/- as claimed by the assessee. 4. Subsequently upon review of the assessment records, Ld. PCIT, Pune-1 found that the assessee has not filed its return of income within the time limit prescribed u/s 139(1) of the IT Act which is a pre-requisite to claim deduction u/s 80P of the IT Act in the light of amended section 80AC of the IT Act. However, the Assessing Officer has allowed the deduction u/s 80P(2) of the IT Act ignoring the amended provisions of section 80AC of the IT Act. Accordingly, Ld. PCIT was of the view that the assessment order Printed from counselvise.com ITA No.1308/PUN/2025 4 dated 19.03.2023 passed u/s 143(3) r.w.s. 147 of the IT Act for assessment year 2018-19 is erroneous and prejudicial to the interests of revenue within the meaning of Explanation 2 of sub-section (1) of section 263 of the IT Act and is proposed to be revised. Accordingly, notice u/s 263 was issued and after considering the reply of the assessee, Ld. PCIT set-aside the assessment order dated 19.03.2023 and directed the Assessing Officer to reframe the assessment order afresh after providing reasonable opportunity of hearing to the assessee. 5. It is the above order against which the assessee is in appeal before this Tribunal. 6. Ld. AR appearing from side of the assessee submitted before us that the order passed by Ld. PCIT u/s 263 of the IT Act is unjustified. Ld. AR submitted that it is true that the assessee has not furnished its return of income within the time limit prescribed u/s 139(1) of the IT Act, however the assessee has furnished the return of income in response to the notice u/s 148 of the IT Act wherein deduction u/s 80P(2) was rightly claimed and the Assessing Officer after considering all the facts and after applying his mind has Printed from counselvise.com ITA No.1308/PUN/2025 5 allowed the deduction u/s 80P(2) of the IT Act. Ld. AR also submitted that even a notice u/s 154 of the IT Act was also issued on similar grounds, however no further action was taken on that. In support of its contentions that in a return in response to notice u/s 148 of the IT Act, the deduction u/s 80P can also be claimed, Ld. AR relied on various decisions and judgements and also furnished paper book containing various related documents and accordingly requested before the bench to quash the order passed by Ld. PCIT u/s 263 of the IT Act. 7. Ld. DR appearing from side of the Revenue relied on the order passed by Ld. PCIT and requested to confirm the same. Ld. DR also relied on various decisions and judgements and also furnished a written note in support of Revenue’s contentions. 8. We have heard Ld. counsels from both the sides and perused the material available on record including the case laws relied on by both the sides. In this regard, we find that admittedly the assessee co-operative society has not furnished its return of income for the assessment year 2018-19 within the time limit prescribed u/s 139(1) of the IT Act and only in the return which is filed in response to Printed from counselvise.com ITA No.1308/PUN/2025 6 notice u/s 148 the deduction u/s 80P(2) of the IT Act was claimed. It is also not disputed that the amended provisions of section 80AC with effect from assessment year 2018-19 mandatorily requires the assessee to file return within the time limit prescribed u/s 139(1) of the IT Act for the purposes of allowance of deduction u/s 80P i.e. Chapter VI-A deductions. Accordingly, we are of the considered opinion that from assessment year 2018-19 any deduction under Chapter VI-A of the IT Act cannot be allowed unless the return of income is filed within the time limit prescribed u/s 139(1) of the IT Act. With regard to the case laws relied on by Ld. AR, we find that most of them pertains prior to assessment year 2018-19 and some of them relates to intimation u/s 143(1) of the IT Act hence not applicable to the facts of the present case. However, we find that one decision of a coordinate bench of this Tribunal is relied on by Ld. AR in ITA No.186/RJT/2022 order dated 10-02-2023 wherein the Tribunal by relying on judgement of Hon’ble Kerala High Court in the case of Chirakkal Service Cooperative Bank vs. CIT has allowed the deduction u/s 80P of the IT Act for assessment year 2019-20. However, we also find that the judgement of Hon’ble Printed from counselvise.com ITA No.1308/PUN/2025 7 Kerala High Court (supra) pertains to prior to assessment year 2018-19 hence not applicable to the present case. Apart from above, the coordinate bench of this Tribunal involving the same combination of members in the case of Sanchar Gramin Bigarsheti Sahakari Patsanstha Maryadit vide ITA No.2434/PUN/2024 order dated 07.04.2025 for assessment year 2018-19 under identical facts involving similar issue have already held that in the light of amended section 80AC, the deduction claimed u/s 80P of the IT Act, in the return filed in response to notice u/s 148 of the IT Act cannot be allowed, since the original return of income was not furnished within the time limit prescribed u/s 139(1) of the IT Act. 9. Considering the totality of the facts of the case and in view of above discussion and also after going through the case laws relied on both the parties, we are of the considered opinion that the impugned assessment order dated 19-03-2023 for assessment year 2018-19 passed u/s 143(3) r.w.s. 147 of the IT Act is erroneous and prejudicial to the interest of the revenue and therefore Ld. PCIT has not made any error in invoking the provisions of section 263 of the IT Act and consequently there is no error in setting aside it and Printed from counselvise.com ITA No.1308/PUN/2025 8 directing the Assessing Officer to reframe the assessment order afresh. Accordingly, the order passed by Ld. PCIT u/s 263 of the IT Act is confirmed. Thus, the grounds of appeal raised by the assessee are dismissed. 10. In the result, the appeal filed by the assessee is dismissed. Order pronounced on this 25th day of September, 2025. Sd/- Sd/- (MANISH BORAD) (VINAY BHAMORE) ACCOUNTANT MEMBER JUDICIAL MEMBER पुणे / Pune; ᳰदनांक / Dated : 25th September, 2025. Sujeet आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The Pr.CIT, Pune-1. 4. िवभागीय ᮧितिनिध, आयकर अपीलीय अिधकरण, “B” बᱶच, पुणे / DR, ITAT, “B” Bench, Pune. 5. गाडᭅ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune. Printed from counselvise.com "