Jetalpur Seva Sahkari Mandali Ltd. v. DCIT

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The Tax Publishers2023 TaxPub(DT) 3600 (Ahd-Trib) IN THE ITAT, AHMEDABAD BENCH SUCHITRA KAMBLE, J.M. Jetalpur Seva Sahkari Mandali Ltd. v. Dy. CIT ITA Nos. 156 & 157/AHD/2023 14 June, 2023 Assessee by: Pankaj Shah, Authorized Representative Revenue by: Sanjay Jain, Senior Departmental Representative ORDER These two appeals are filed by the assessee against two separate Orders dated 29-9-2022& 27-9-2022, passed by the Commissioner (Appeals), National Faceless Appeal Centre (NFAC), Delhi for the assessment years 2017-18 and 2018-19 respectively. 2. The assessee has raised the following grounds of appeal:- ITA No. 156/AHD/2023 for A.Y. 2017-18 1. On facts and circumstances of the case and in law the learned Commissioner (Appeals) has failed to delete the disallowance made by the learned assessing officer of Rs. 9,43,000. Therefore, your appellant prays your good self to delete the disallowance of Rs. 9,43,000 made by the learned assessing officer ITA No. 157/AHD/2023 for A.Y. 2018-19 1. The Deputy Commissioner has erred in not considering the deduction under section 80P(2)(a) of the Income Tax Act, 1961, regarding the receipt of interest income of Rs. 5,51,878 from the Pump Division of Mandali. 3. Taking up assessment year (A.Y.) 2017-18 as the issue involved is identical in both these appeals. The assessee filed return of income for assessment year 2017-18 on 25-10-2017 declaring total income of Rs. 21,52,910. The return was processed under section 143(1) of the Income Tax Act, 1961. The case was selected for scrutiny under limited scrutiny for the reason large claim of deduction under Chapter-VI. The assessing officer observed that from the computation of income, it appears that the assessee had claimed deduction under section 80P of Rs. 33,21,232. This included interest income of Rs. 9,43,000 received from its Petrol Pump branch business. The petrol pump had borrowed funds from the assessees head office for which the assessee had received interest. The assessee was asked to justify as to how interest from petrol pump was eligible for deduction under section 80P of the Act. The assessee filed reply before the assessing officer merely contending that as main activity of HO division is to provide finance so that the interest income from Pump Division of Rs. 9,43,000 claimed as deduction under section 80P(2)(a) of the Act. The assessee further submitted before the assessing officer that the interest expense claimed by the Pump Division and interest income shown in the HO Division and claimed as deduction of Rs. 9,43,000 is correct. After taking cognisance of the assessees reply, the assessing officer disallowed Rs. 9,43,000 which was claimed under section 80P of the Act. SUBSCRIBE FOR FULL CONTENT

The Tax Publishers2023 TaxPub(DT) 3600 (Ahd-Trib)

IN THE ITAT, AHMEDABAD BENCH

SUCHITRA KAMBLE, J.M.

Jetalpur Seva Sahkari Mandali Ltd. v. Dy. CIT

ITA Nos. 156 & 157/AHD/2023

14 June, 2023

Assessee by: Pankaj Shah, Authorized Representative

Revenue by: Sanjay Jain, Senior Departmental Representative

ORDER

These two appeals are filed by the assessee against two separate Orders dated 29-9-2022& 27-9-2022, passed by the Commissioner (Appeals), National Faceless Appeal Centre (NFAC), Delhi for the assessment years 2017-18 and 2018-19 respectively.

2. The assessee has raised the following grounds of appeal:-

ITA No. 156/AHD/2023 for A.Y. 2017-18

1. On facts and circumstances of the case and in law the learned Commissioner (Appeals) has failed to delete the disallowance made by the learned assessing officer of Rs. 9,43,000. Therefore, your appellant prays your good self to delete the disallowance of Rs. 9,43,000 made by the learned assessing officer

ITA No. 157/AHD/2023 for A.Y. 2018-19

1. The Deputy Commissioner has erred in not considering the deduction under section 80P(2)(a) of the Income Tax Act, 1961, regarding the receipt of interest income of Rs. 5,51,878 from the Pump Division of Mandali.

3. Taking up assessment year (A.Y.) 2017-18 as the issue involved is identical in both these appeals. The assessee filed return of income for assessment year 2017-18 on 25-10-2017 declaring total income of Rs. 21,52,910. The return was processed under section 143(1) of the Income Tax Act, 1961. The case was selected for scrutiny under limited scrutiny for the reason large claim of deduction under Chapter-VI. The assessing officer observed that from the computation of income, it appears that the assessee had claimed deduction under section 80P of Rs. 33,21,232. This included interest income of Rs. 9,43,000 received from its Petrol Pump branch business. The petrol pump had borrowed funds from the assessees head office for which the assessee had received interest. The assessee was asked to justify as to how interest from petrol pump was eligible for deduction under section 80P of the Act. The assessee filed reply before the assessing officer merely contending that as main activity of HO division is to provide finance so that the interest income from Pump Division of Rs. 9,43,000 claimed as deduction under section 80P(2)(a) of the Act. The assessee further submitted before the assessing officer that the interest expense claimed by the Pump Division and interest income shown in the HO Division and claimed as deduction of Rs. 9,43,000 is correct. After taking cognisance of the assessees reply, the assessing officer disallowed Rs. 9,43,000 which was claimed under section 80P of the Act.