VIVIDODDHESHAGALA PRATHAMIKA GRAMEENA KRISHI SAHAKARI SANGHA NIYAMIT MOLE,MOLE V. INCOME TAX OFFICER, WARD - 1, BELAGAVI

ITA 235/PAN/2024

AI Insights

The case involves Vividoddheshagala Prathamika Grameena Krishi Sahakari Sangha Niyamit, a cooperative society, which appealed against the order of the Income Tax Officer (ITO) and subsequent NFAC decision, which denied them a deduction under section 80P(2)(a)(i) of the Income Tax Act, 1961. The society, engaged in providing credit facilities and other services to its members, filed a return declaring nil taxable income after claiming the said deduction. The ITO's assessment brought certain income to tax, which was contested. The NFAC dismissed the appeal due to non-compliance with a notice, which the tribunal found to have not provided a reasonable opportunity for compliance. Consequently, the tribunal set aside the NFAC's order and remanded the case for a fresh assessment.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 26271 (ITAT-PANAJI)
• Duration Of Justice: 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-12-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: WT(D)
• Next Hearing Date: 28-11-2024
• Assessment Year: 2013-2014
• Appeal Filed On: 09-09-2024
• Other Referred Cases: St. Paul’s Anglo Indian Education Society [2003, 262 ITR 377 (Pat)]
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Department Lawyers: ASHWINIHOSMANI LD.
• Keywords: Principle of natural justice

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, PANAJI BENCH, BEFORE HON’BLE SHRI PAVAN KUMAR GADALE, SHRI G. D. PADMAHSHALI VividoddheshagalaPrathamika GrameenaKrishiSahakara SanghaNiyamit, Mole, Tal. Athani, DistBelagavi Karnataka - 591380 PAN:AABAP2657E Income Tax Officer, Ward-1, Belagavi Assesseeby:None[‘Ld. AR’] Revenue by Date of conclusive Hearing: Date of Pronouncement : PER G. D. PADMAHSHALI The present appeal is filed by the assessee No. ITBA/NFAC/S/250/202 passed u/s.250 of the Income the National Faceless Appeal Centre [for short ‘NFAC’] which has ascended out of order of assessment passed u/s.143(3) by the ITO [for short ‘AO’], Ward assessment year 2013-14 IN THE INCOME TAX APPELLATE TRIBUNAL, PANAJI BENCH, PAVAN KUMAR GADALE, JUDICIAL MEMBER AND SHRI G. D. PADMAHSHALI,ACCOUNTANT MEMBER ITA No.235/PAN/2024 Assessment Year :2013-14 VividoddheshagalaPrathamika .......Appellant V/s ....... Respondent Appearances Revenue by :Dr.AshwiniHosmani [‘Ld. DR’] Date of conclusive Hearing:28/11/2024 Date of Pronouncement : 02/12/2024 ORDER G. D. PADMAHSHALI, AM; is filed by the assessee against the DIN & Order No. ITBA/NFAC/S/250/2024-25/1066572410(1) dt.10/07 250 of the Income-tax Act, 1961 [for short ‘the Act’] by the National Faceless Appeal Centre [for short ‘NFAC’] which out of order of assessment passed u/s.143(3) by the , Ward-1(4), Belgaum in relation to the 14[for short ‘AY’] IN THE INCOME TAX APPELLATE TRIBUNAL, PANAJI BENCH, PANAJI JUDICIAL MEMBER ACCOUNTANT MEMBER against the DIN & Order 10/07/2024 tax Act, 1961 [for short ‘the Act’] by the National Faceless Appeal Centre [for short ‘NFAC’] which inturn out of order of assessment passed u/s.143(3) by the 1(4), Belgaum in relation to the 2. Briefly stated, the facts of the case are that the assessee is a Cooperative Societycarrying on the business of accepting deposits from members and providing credit facilities, supplying fertilizers, pesticides etc., to its members. It 25/09/2013 declaring taxable income at Nil after claiming deduction u/s.80P(2)(a)(i) of upon to furnish details of categories of income etc. In response, the assessee filed its submissions and relied certain decisions in support of its case. After taking into cognizance the submission of assessee, the AO completed the assessment holding that the assessee does not qualify for deduction u/s.80P(2) of the Act. While doing brought to tax the interest/dividend income under the head ‘Income from other sources. 3. Aggrieved assessee approached the L issued notice dated 19/06/2024 to which there was no compliance by the assessee. In the event of failure of the assessee to respond to such notice, the countenanced the addition made by Ld. AO, thereby dismissed the appeal for non-prosecution.Further aggrieved, the assessee ca present appeal before the Tribunal Vividoddheshagala Prathamika Grameena Krishi Sahakari Sangha Niyamit Vs. ITO Briefly stated, the facts of the case are that the assessee is a carrying on the business of accepting deposits from members and providing credit facilities, supplying fertilizers, its members. It filed the return of income on declaring taxable income at Nil after claiming deduction u/s.80P(2)(a)(i) of Rs.17,16,710. The assessee was called upon to furnish details of categories of income etc. In response, the led its submissions and relied certain decisions in support of its case. After taking into cognizance the submission of assessee, the AO completed the assessment holding that the assessee does not qualify for deduction u/s.80P(2) of the Act. While doing brought to tax the interest/dividend income under the head ‘Income rieved assessee approached the Ld. NFAC. The L dated 19/06/2024 to the assessee through ITBA portal to which there was no compliance by the assessee. In the event of failure of the assessee to respond to such notice, the countenanced the addition made by Ld. AO, thereby dismissed the prosecution.Further aggrieved, the assessee ca before the Tribunal. Vividoddheshagala Prathamika Grameena Krishi Sahakari Sangha Niyamit Vs. ITO ITA No.235/PAN/2024 Briefly stated, the facts of the case are that the assessee is a carrying on the business of accepting deposits from members and providing credit facilities, supplying fertilizers, filed the return of income on declaring taxable income at Nil after claiming The assessee was called upon to furnish details of categories of income etc. In response, the led its submissions and relied certain decisions in support of its case. After taking into cognizance the submission of assessee, the AO completed the assessment holding that the assessee does not qualify for deduction u/s.80P(2) of the Act. While doing so, the AO brought to tax the interest/dividend income under the head ‘Income d. NFAC. The Ld. NFAC through ITBA portal to which there was no compliance by the assessee. In the event of failure of the assessee to respond to such notice, the Ld.NFAC countenanced the addition made by Ld. AO, thereby dismissed the prosecution.Further aggrieved, the assessee came in 4. Without touching merits & grounds, we noted that, during the course of first appellate proceedings the Ld. NFAC issued notice dated 19/06/2024to the appellant on five e ITBA portal. In the event of failure on the part of a respond to such notice, the appeal ex-parte on the basis of material available on record. apparently capable of suggesting that, accord no real opportunity but to create a paper trail to showcase adherence to natural justice. 5. It shall be worthy to underline that the opportunity of being heard should be real, reasonable and effective and same should not be empty or paper formalities, it should not b In this context of reasonable period/opportunity, the Hon’ble High court of Patna judgement in Society’ [2003, 262 ITR 377 (Pat)]’ has categorically held that, an adjudication is unjustified if an opportunity and reasonable time to produce all relevant documents to substantiate claims made in the return of income. Vividoddheshagala Prathamika Grameena Krishi Sahakari Sangha Niyamit Vs. ITO Without touching merits & grounds, we noted that, during the course of first appellate proceedings the Ld. NFAC issued notice dated 19/06/2024to the appellant on five e-mails through event of failure on the part of appellant notice, the appeal was dismissed by the Ld. NFAC on the basis of material available on record. apparently capable of suggesting that, such notice was ortunity but to create a paper trail to showcase adherence to natural justice. It shall be worthy to underline that the opportunity of being heard should be real, reasonable and effective and same should not be empty or paper formalities, it should not be a paper opportunity. In this context of reasonable period/opportunity, the Hon’ble High court of Patna judgement in ‘St. Paul’s Anglo Indian Education [2003, 262 ITR 377 (Pat)]’ has categorically held that, an adjudication is unjustified if an assessee was deprived of reasonable opportunity and reasonable time to produce all relevant documents to substantiate claims made in the return of income. Vividoddheshagala Prathamika Grameena Krishi Sahakari Sangha Niyamit Vs. ITO ITA No.235/PAN/2024 Without touching merits & grounds, we noted that, during the course of first appellate proceedings the Ld. NFAC issued a single mails through ppellant to dismissed by the Ld. NFAC on the basis of material available on record. This is such notice was meant to ortunity but to create a paper trail to showcase It shall be worthy to underline that the opportunity of being heard should be real, reasonable and effective and same should not e a paper opportunity. In this context of reasonable period/opportunity, the Hon’ble High ‘St. Paul’s Anglo Indian Education [2003, 262 ITR 377 (Pat)]’ has categorically held that, an assessee was deprived of reasonable opportunity and reasonable time to produce all relevant documents 6. In summation, the appellant was deprived of reasonable opportunity and reasonable time to produce a documents/evidence in support of grounds of appeal raised, therefore the first appellate proceedings suffered from natural justice, hence cannot be continued to stand. The aforestated circumstances necessitate opportunity to the appellant to comply with notices and contest appeal on merits which can only be possible on remand of th to Ld. NFAC. In view thereof, without offering any comments on merits, we set-aside the of their institution before Ld. NFAC with a direction deal therewith de-novo and pass separate speaking orders in terms of section 250(6) of the Act. 8. In result, the appeal In terms of rule 34 of ITAT Rules, the order pronounced in the open court on this -S/d- PAVAN KUMAR GADALE JUDICIAL MEMBER 02nd December, 2024 Satish Vividoddheshagala Prathamika Grameena Krishi Sahakari Sangha Niyamit Vs. ITO In summation, the appellant was deprived of reasonable opportunity and reasonable time to produce all relevant documents/evidence in support of grounds of appeal raised, therefore the first appellate proceedings suffered from natural justice, hence cannot be continued to stand. The aforestated circumstances necessitated us to grant one more reasonable opportunity to the appellant to comply with notices and contest on merits which can only be possible on remand of th to Ld. NFAC. In view thereof, without offering any comments on impugned order and remand it to the stage of their institution before Ld. NFAC with a direction deal therewith and pass separate speaking orders in terms of section In result, the appeal is allowed for statistical purposes. In terms of rule 34 of ITAT Rules, the order pronounced in the open court on this 02nd day of December, 2024. -S/d- PAVAN KUMAR GADALE G. D. PADMAHSHALI ACCOUNTANT MEMBER 2024 Vividoddheshagala Prathamika Grameena Krishi Sahakari Sangha Niyamit Vs. ITO ITA No.235/PAN/2024 In summation, the appellant was deprived of reasonable ll relevant documents/evidence in support of grounds of appeal raised, therefore the first appellate proceedings suffered from natural justice, hence cannot be continued to stand. The aforestated us to grant one more reasonable opportunity to the appellant to comply with notices and contest the on merits which can only be possible on remand of this case to Ld. NFAC. In view thereof, without offering any comments on to the stage of their institution before Ld. NFAC with a direction deal therewith and pass separate speaking orders in terms of section allowed for statistical purposes. , 2024. G. D. PADMAHSHALI ACCOUNTANT MEMBER Copy of the Order forwarded to : 1. The Appellant. 2. The Respondent. 4. PCIT Concerned 5. DR, ITAT, Panaji Bench, Panaji //True Copy // Vividoddheshagala Prathamika Grameena Krishi Sahakari Sangha Niyamit Vs. ITO Copy of the Order forwarded to : 2. The Respondent. 3. The CIT(A)/NFAC Concerned DR, ITAT, Panaji Bench, Panaji 6. Guard File Sr. Private Secretary / AR Vividoddheshagala Prathamika Grameena Krishi Sahakari Sangha Niyamit Vs. ITO ITA No.235/PAN/2024 CIT(A)/NFAC Concerned By Order, / AR ITAT, Panaji. "