Section 80A(5) cannot be invoked for denying Deduction u/s 80P even if ITR is not filed: ITAT [Read Order]

The Section 80A (5) cannot be invoked for denying deduction under Section 80P even if Income Tax Return was not filed, so was held by the Income Tax Appellate Tribunal (ITAT), Bangalore.

The assessee, M/s. Prathamika Krishi Pattina, Sahakara Sangha Ltd is primarily an agricultural co-operative society and derives income from providing credit facilities to its members and farmers. The assessee also distributes fertilizers, manure, and PDS products. For Assessment Year 2016-17, the assessee did not file the return of income. The Assessing Officer (AO) issued a notice under section 142(1) of the Income Tax Act, 1961calling upon the assessee to file the return of income for Assessment Year 2017-18. Notice was issued giving time to file the return of income. The assessee did not comply with the said notice and therefore a summons under section 131 of the Act was issued.

In response to the said summons, the assessee produced Income and Expenditure A/c, Balance Sheet, and Cash Book. As per the Income and Expenditure A/c produced, the assessee had a surplus in the Income and Expenditure A/c of Rs.1,89,165/-. The AO, therefore, issued a notice proposing to assess the assessee at the total income of Rs.1,89,165/- as income from the business. The AO also proposed to deny the assessee the benefit of deduction under section 80P of the Act for the reason that the assessee did not file the return of income for Assessment Year 2017-18 making a claim for deduction under section 80P of the Act. In this regard, the AO considered Section 80A(5) of the Act.

N. V. Vasudevan, Vice President observed that “Section 80A(5) of the Act is applicable only when a return of income is filed by an assessee and a deduction under Chapter VI “A” of the Act, is not claimed in such return of income.”

To Read the full text of the Order CLICK HERE

Support our journalism by subscribing to TaxscanAdFree. Follow us on Telegram for quick updates.