ITAT Bangalore Upholds Denial of Section 80P Deduction on Belated Returns Processed u/s 143(1)

The Income Tax Appellate Tribunal (ITAT), Bangalore Bench, has delivered a significant ruling concerning the eligibility of co-operative societies to claim deductions under Section 80P of the Income Tax Act 1961 when returns are filed after the statutory due date. In the case of Sowrabha Mahila Pattina Sahakara Sangha Vs ITO, the Tribunal confirmed that the Central Processing Centre (CPC) has the authority to disallow such claims through an intimation under Section 143(1), citing the mandatory provisions of Section 80AC.

Background of the Dispute

The legal controversy arose regarding the Assessment Year 2019-20. The appellant, a co-operative society, submitted its Return of Income (ROI) declaring Nil income after claiming a deduction under Section 80P. Crucially, this return was filed on November 21, 2020, which was well beyond the due date prescribed under Section 139(1) (i.e., August 31, 2019).

Upon processing the return, the CPC issued an intimation under Section 143(1) denying the deduction. The adjustment was made on the grounds that Section 80AC expressly bars deductions under Chapter VI-A (Part C) if the return is not filed within the time limits set by Section 139(1).