CBDT vide Circular No. 13/2023 dated 26.07.2023 authorizes CCsIT/DGsIT to condone the delay in filing income tax returns by cooperative societies claiming deduction under section 80P of the Income-tax Act, 1961 (‘Act’) for the Assessment Years (AYs) 2018-19 to 2022-23. The application for condonation of delay shall be decided on merits and in accordance with the law where society is required to get its accounts audited under the respective State Laws.
Section 80P of the Act provides for deduction in respect of income of co-operative societies under Chapter VIA-Part-C (“Deductions in respect of certain incomes”) of the Act.
Finance Act, 2018 has amended the provisions of section 80AC of the Act which restricts allowance of certain deductions under Chapter-VI-A of the Act unless the return of income is furnished within the due date of furnishing the return of income as per the provisions of section 139(1).
In other words, section 80P of the Act provides for deduction in respect of income of cooperative societies. However, no such deduction shall be allowed unless return of income for the relevant assessment year is furnished on or before the due date specified in section 139(1).
Co-operative societies claiming deduction under section 80P of the Act for AYs from 2018-19 to 2022-23 have made application before the CBDT regarding condonation of delay in furnishing return of income and to treat such returns as returns furnished within the due date under section 139(1) of the Act stating that delay in furnishing return of income was caused due to delay in getting the accounts audited under respective State Laws.
To mitigate genuine hardship, the CBDT has authorized the Chief Commissioners of Income-tax (CCsIT)/Directors General of Income-tax (DGsIT) to deal with such applications of condonation of delay.
The Board has directed that the CCsIT/DGsIT shall admit all applications for condonation of delay in furnishing returns of income claiming deduction under section 80P of the Act for the assessment years 2018-19 to 2022-23 and decide such applications on merits in accordance with the law where such person is required to get his accounts audited under respective State Laws.
The Board has further directed that the CCsIT/DGsIT while deciding the applications for condonation of delay in furnishing return of income, shall satisfy themselves that the applicant’s case is a fit case for condonation under the existing provisions of the Act.
The CCSIT/DGSIT shall examine the following while deciding such applications –
(i) the delay in furnishing the return of income within the due date under sub-section (1) of section 139 of the Act was caused due to circumstances beyond the control of the assessee with appropriate documentary evidence/s,
(ii) where delay in furnishing return of income was caused due to delay in getting the accounts audited by statutory auditors appointed under the respective State Law under which such person is required to get his accounts audited, the date of completion of audit vis-Ã -vis the due date of furnishing the return of income under sub-section (1) of section 139 of the Act, and
(iii) any other issue indicating towards tax avoidance or tax evasion specific to the case, which comes into the light in the course of verification and having bearing either in the relevant assessment year or establishing connection of relevant assessment year with other assessment year/s.
The cases falling under para 6(iii) above, would require further necessary action as per law.
The Circular further states that the application for condonation of delay shall be disposed within three months from the end of the month in which such application is received from the applicant.
Further, no order rejecting the application under section 119(2)(b) of the Act shall be passed without providing the applicant an opportunity of being heard.
These directions were issued by the Board by exercising the powers conferred to it under section 119 of the Act.
This is one of the several initiatives taken by the government to resolve the difficulties faced by the cooperative societies in income-tax related issues.
Read the full text of CBDT Circular No. 13/2023 dated 26.07.2023 on Condonation of Delay in furnishing Income-tax Return for AY 2018-19 to AY 2022-23 by Co-operative Societies for Claiming Deduction under section 80P
Circular No. 13/2023
F.No.173/21/2023-ITA-I
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
New Delhi the 26th July, 2023
Sub:- Condonation of delay under clause (b) of sub-section (2) of section 119 of the Income-tax Act, 1961 for returns of income claiming deduction u/s 80P of the Act for various assessment years from AY 2018-19 to AY 2022-23- Reg.
Section 80P of the Income-tax Act, 1961 (hereafter referred to as ‘Act’) provides for deduction in respect of income of co-operative societies under Chapter VIA-Part-C (“Deductions in respect of certain incomes”) of the Act.
2. In so far as section 80P of the Act is concerned, Finance Act, 2018 substituted section 80AC of the Act w.e.f. 01 .04.2018 which provides as under -
Deduction not to be allowed unless return furnished
80AC. Where in computing the total income of an assessee of any previous year relevant to the assessment year commencing on or after-
(i) the 1st day of April, 2006 but before the 1st day of April, 2018, any deduction is admissible under section 80-IA or section 80-IAB or section 80-IB or section 80- IC or section 80-ID or section 80-IE;
(ii) the 1st day of April, 2018, any deduction is admissible under any provision of this Chapter under the heading “C. - Deductions in respect of certain incomes”,
no such deduction shall be allowed to him unless he furnishes a return of his income for such assessment year on or before the due date specified under sub-section (1) of section 139.
3. Applications have been received in the Central Board of Direct Taxes (hereafter referred to as ‘the Board’) from co-operative societies claiming deduction u/s 80P of the Act for various assessment years from AY 2018 to AY 2022-23, regarding condonation of delay in furnishing return of income and to treat such returns as ‘returns furnished within the due date under sub-section (1) of section 139 of the Act stating that delay in furnishing return of income was caused due to delay in getting the accounts audited under respective State Laws.
4. In order to mitigate genuine hardship in cases referred to in para 3, the Board, in exercise of the powers conferred under section 119 of the Act, hereby directs that the Chief Commissioners of Income· tax (CCsIT) / Directors General of Income·tax (DGsIT) are authorised to deal with such applications of condonation of delay pending before the Board, upon transfer of such applications by the Board, and decide such applications on merits, in accordance with the law.
5. The Board hereby further directs that the CCsIT/DGsIT, henceforth, shall admit all pending as well as new applications for condonation of delay in furnishing returns of income claiming deduction u/s 80P of the Act, filed either in the Board or in field formation for the assessment years 2018·19 to 2022·23 and decide such applications on merits in accordance with the law where such person is required to get his accounts audited under respective State Laws.
6. In the context of para·5 above, the CCsIT/DGsIT while deciding such applications for condonation of delay in furnishing return of income, shall satisfy themselves that the applicant's case is a fit case for condonation under the existing provisions of the Act. The CCsIT/DGsIT shall examine the following while deciding such applications -
(i) the delay in furnishing the return of income within the due date under sub-section (1) of section 139 of the Act was caused due to circumstances beyond the control of the assessee with appropriate documentary evidence/s;
(ii) where delay in furnishing return of income was caused due to delay in getting the accounts audited by statutory auditors appointed under the respective State Law under which such person is required to get his accounts audited, the date of completion of audit vis-Ã -vis the due date of furnishing the return of income under sub-section (1) of section 139 of the Act; and
(iii) any other issue indicating towards tax avoidance or tax evasion specific to the case, which comes into the light in the course of verification and having bearing either in the relevant assessment year or establishing connection of relevant assessment year with other assessment year/s.
6.1 The cases falling under para 6(iii) above, would require further necessary action as per law.
7. The CCsIT/DGsIT shall preferably dispose the application within three months from the end of the month in which such application is received from the applicant or transferred by the Board. No order rejecting the application under section 119(2)(b) of the Act shall be passed without providing the applicant an opportunity of being heard.
8. Hindi version to follow.
(Vikas Singh)
Director (ITA-I)
Download CBDT Circular No. 13/2023 dated 26.07.2023 on Condonation of Delay in furnishing Income-tax Return for AY 2018-19 to AY 2022-23 by Co-operative Societies for Claiming Deduction under section 80P in PDF format
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