VELLANIKKARA SERVICE CO OPERATIVE BANK ,THRISSUR V. INCOME TAX OFFICER WARD 2(1), THRISSUR

ITA 846/COCH/2023

AI Insights

The case involves the Vellanikkara Service Co-op. Bank Ltd., which appealed against the order of the National Faceless Appeal Centre, Delhi (CIT(A)), concerning the Assessment Year 2018-19. The appellant, a primary agricultural co-operative society, had filed a return declaring nil income after claiming a deduction under section 80P of the Income Tax Act, 1961. The Income Tax Officer (AO) initially denied this deduction, leading to an appeal where the CIT(A) partially allowed the deduction but excluded income from services rendered to non-members. The appellant contested the CIT(A)'s decision regarding the income from non-members and also addressed an additional disallowance made under section 40A(7) of the Act for a provision for gratuity. The Tribunal dismissed the appeal on procedural grounds, stating that the issues raised were not part of the original appeal before the CIT(A).

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 23442 (ITAT-COCHIN)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2018-2019
• Other Referred Cases: Mavilayi Service Co-operative Bank Ltd. v. CIT [2021] 431 ITR 1 (SC)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: LEENA LAL
• Section: 143(3); 80P

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH BEFORE SHRI INTURI RAMA RAO, AM ITA No. 846/Coch/2023 Assessment Year: 2018-19 Vellanikkara Service Co-op. Bank Ltd. .......... Appellant Madakathara, Thrissur 680651 [PAN: AAAAV7463M] vs. The Income Tax Officer .......... Respondent Ward - 2(1), Thrissur Appellant by: ------- None ------- Respondent by: Smt. Leena Lal, Sr. D.R. Date of Hearing: 17.01.2025 Date of Pronouncement: 23.01.2025 O R D E R This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre, Delhi [CIT(A)] dated 22.08.2023 for Assessment Year (AY) 2018-19. 2. The appellant is a primary agricultural co-operative society registered under the Kerala State Co-operative Societies Act, 1969. The appellant filed the return of income for AY 2018-19 on 27.10.2018 declaring Nil income after claiming deduction u/s. 80P of the Income Tax Act, 1961 (the Act) of Rs. 3,99, 21,348/-. Against the said return of income, the assessment was completed by the Income Tax Officer, Ward -2(1), Thrissur (hereinafter called \"the AO\") vide order dated 03.03.2021 passed u/s. 143(3) of the Act at a 2 ITA No. 846/Coch/2023 Vellanikkara Service Co-op. Bank Ltd. total income of Rs. 4,11,71,348/- denying deduction u/s. 80P of the Act. 3. Being aggrieved, an appeal was filed before the CIT(A), who vie order dated 22.08.2023 allowed the claim u/s. 80P of the Act following the judgement of the Hon'ble Supreme Court in the case Mavilayi Service Co-operative Bank Ltd. v. CIT [2021] 431 ITR 1 (SC). However, he proceeded to hold that the income generated from the services rendered to non-members would not be eligible for deduction u/s. 80P of the Act. 4. Being aggrieved, the appellant filed the present appeal raising the following grounds of appeal: - “1. With reference to the Ld. AO's order Giving Effect to the Honorable Commissioner of Income Tax (Appeals)' Order, pertaining to Appeal No. NFAC/2017-18/10051763, dated 22.08.2023, we submit that there has been an erroneous interpretation and application of the statutory provisions. 2. That the addition to income has been made on account of disallowance made u/s 40A(7) of the Act for an amount to the tune of Rs. 12,50,000/-reported as provision for Gratuity as per the Statutory Audit Report issued by the Department of Co- operation, Govt. of Kerala. 3. That the Appellant confirms that they had already disallowed the said amount though inadvertently u/s 36(1) (viii) of the Act instead of the actually applicably Section 40A(7) of the Act. In this regard, the Appellant further confirms that they are in possession of the relevant computation statement, ITR filed & Statutory Audit Report for substantiating the said claim. 3 ITA No. 846/Coch/2023 Vellanikkara Service Co-op. Bank Ltd. 4. Hence it may be reasonably inferred that the Appellant had disallowed the same voluntarily and no further disallowance as proposed by the Ld. AO is required. 5. The Appellant based on the submissions made herein, prays that the addition & tax demanded amounting to Rs. 12,50,000/- & Rs. 6,03,532/-respectively, made by the AO be deleted.” 5. The above grounds raised by the assessee neither emanate from the order of the learned CIT(A) nor form part of subject matter of appeal before the CIT(A). If the assessee is aggrieved by the consequential order passed to the CIT(A)’s order, the remedy lies somewhere else and, therefore the grounds raised by the appellant are dismissed as not maintainable. 6. In the result, appeal filed by the assessee is dismissed. Order pronounced in the open court on 23rd January, 2025. Sd/- (INTURI RAMA RAO) ACCOUNTANT MEMBER Cochin, Dated: 23rd January, 2025 n.p. Copy to: 1. The Appellant 2. The Respondent 3. The Pr. CIT concerned 4. The Sr. DR, ITAT, Cochin 5. Guard File Assistant Registrar ITAT, Cochin "