ITAT Remands Section 80P Deduction Claim for Fresh Adjudication:

The assessee is Kavitam Large Sized Cooperative Credit Society Limited who had claimed deduction under Section 80P of the Income Tax Act, 1961. However, the AO denied the deduction while completing the scrutiny assessment, despite the assessee's claim that it had furnished the necessary details.

Aggrieved by the assessment order, the assessee approached the CIT(A). During the appellate proceedings, the CIT(A) issued four hearing notices dated August 9, 2023, October 8, 2024, August 13, 2025 and August 21, 2025. However, the assessee did not furnish any written submissions in response to these notices. Consequently, the CIT(A) confirmed the assessment order vide order dated September 12, 2025.

Before the Tribunal, the assessee sought condonation of the delay of 121 days in filing the appeal. It was explained that the assessee was a cooperative society situated in a village and primarily provided credit support to farmers. Its members were farmers who did not possess adequate knowledge of computer operations. Since the assessee had opted for physical hearings, it was unaware that the hearing notices were being communicated electronically. As a result, it could not respond to the notices, and the CIT(A) proceeded to dispose of the appeal ex-parte.

The assessee also explained that it came to know about the CIT(A)'s order only after receiving a penalty notice from the Income Tax Department. It immediately approached its Chartered Accountant to file an appeal before the Tribunal.

After considering the submissions of both parties, the Tribunal observed that the assessee had specifically opted for physical hearings instead of electronic communication. However, all the hearing notices were issued through the computer system, due to which the assessee remained unaware of the notices. The Tribunal considered these circumstances sufficient to explain the delay of 121 days in filing the appeal and held that the delay deserved to be condoned.

Regarding the substantive issue, the Tribunal observed that the CIT(A)'s order was silent on the merits of the case and did not contain any adjudication concerning the denial of deduction under Section 80P of the Act. Accordingly, the Tribunal considered it appropriate to remit the matter to the file of the CIT(A), directing the appellate authority to provide an effective opportunity of hearing to the assessee society and pass a fresh order after examining the matter on merits.