Chandra Poojari ORDER
George George K., Vice President
1. This appeal is filed by the assessee against the order of the CIT(Appeals), National Faceless Appeal Centre, Delhi [NFAC] dated 18.10.2023 for the assessment year 2014-15.
2. The solitary issue that is raised is whether the CIT(Appeals) is justified in confirming the order of the AO passed u/s. 154 of the Act denying deduction 80P of the Act amounting to Rs. 27,16,210.
3. The brief facts of the case are that the assessee is a credit co- operative society engaged in the business of providing credit facilities to its members. For the AY 2014-15, return of income was filed on 6.3.2015 declaring a net income of Rs. 3,700, after claiming deduction u/s.80P of the Act amounting to Rs. 27,16,210. The case was selected for scrutiny and notices u/s. 143(2) & 142(1) were issued. After hearing the assessee, the AO passed an order u/s. 143(3) dated 14.12.2016 accepting the returned income. Subsequently the assessee was issued notice by the AO dated 22.7.2021 informing his intention to rectify the assessment order dated 14.12.2016. Since there was no reply to the notice issued, the AO passed an order u/s. 154 of the Act on 30.3.2022 denying the claim of deduction u/s. 80P.
4. Aggrieved by the order of the AO passed u/s. 154 of the Act, the assessee filed appeal before the first appellate authority. The CIT(Appeals) dismissed the appeal of the assessee and confirmed the view taken by the AO in his order passed u/s. 154 rejecting the claim of deduction u/s. 80P of the Act. The relevant finding of the CIT(Appeals) reads as follows:-
"Section 154(3) of the Act clearly specifies that an opportunity is to be granted to the assessee before enhancing an assessment or increasing the liability.
It is not understood how the appellant has denied any communication with him, when there has been a letter from the AO to the appellant dated 22.07.2021 bearing DIN and letter no. ITBA/COM/F/17/2021-22/103436999(1),informing the appellant of the intention of the AO to rectify the order dated 14.12.2016, and giving time till 30.07.2021 to furnish a reply to the same.
The appellant has chosen not only to reply to this letter, but also to mention in his grounds of appeal that no opportunity was given to him prior to rectification, to which I take a serious view, since this amounts to misleading the appellate authority.
Lastly the appellant says that that disallowance of 80P is a debatable issue, and not a mistake apparent from records.
The said letter dated 22.07.2021 informs the appellant of the intention of the AO to rectify the assessment order in view of the decision of the Hon'ble SC in the case of Citizen Co-operative Society Ltd. and in the case of Saurashtra Kutch Stock Exchange Ltd.
The appellant on the other hand has not gone into the merits of the case at all.
Relying on the decisions of the Hon'ble SC, I refuse to interfere with the order of the AO."
5. Aggrieved by the order of the CIT(Appeals), the assessee has filed the present appeal before the Tribunal. The assessee has filed a paperbook comprising of 19 pages enclosing therein notice u/s. 154, assessment order u/s. 143(3), the case law relied on, written submissions filed before the CIT(A), etc. The ld. AR reiterated the submissions made before the CIT(A) and submitted that the there is no mistake apparent on record warranting interference u/s. 154 of the Act. It is submitted that the issue involved is highly debatable and not amenable to rectification u/s. 154 of the Act. He relied on the judgment of the Hon'ble Apex Court in the case of T.S. Balaram v. Volkart Brothers, MANU/SC/0400/1971 : 82 ITR 50 (SC).
6. The ld. standing counsel supported the order passed u/s. 154 of the Act a........