Sterling Court F Wing Co-op. Hsg. Society Ltd. v. ITO

Case snapshot

Sections / provisions: 80P

Questions before the Court / Tribunal

• Section 80P and belated return: The reported case concerns availability of section 80P deduction despite a belated return. Primary text is required to capture the relevant filing-condition provision and year.

Material facts and background

The brief facts of the case are that, the assessee has filed its return of

income for the AY 2012-13 on 27.09.2012, declaring a total income at Rs. 89,650/- after claiming deduction under Chapter-VIA as per provisions of section 80P(2)(d) of the Act. The return of assessee was processed under section 143(1) on 27.02.2013, disallowing the claim of deduction under section 80P(2)(d) for Rs. 2,66,556/-. Being aggrieved with such disallowance, assessee preferred to file an application for rectification under section 154 of the Act before the Jurisdictional AO (JAO), but JAO rejected the request of assessee

ITA Nos. 7121, 7120 & 7122/Mum/2025 Sterling Court F Wing Co-op. Housing Society Ltd.

vide order u/s 154 dated 28.04.2023, stating that there is no mistake apparent on record. 5.

Aggrieved with the aforesaid rectification order, assessee preferred an

appeal before the ld. CIT(A), who also had dismissed the appeal of assessee with the observations that the return filed by the assessee was beyond the stipulated date of filing of return of income under section 139(1), therefore as per the prevailing jurisdictional interpretation of section 80A(5) r.w.s. 139(1) of the Act, any deduction claimed under Chapter-VIA which includes section 80P also is not admissible unless the return of income is filed on or before the due date specified under section 139(1) of the Act. The ld. CIT(A) also mentioned that the interest income received by the assessee from Saraswat Co-operative Bank which has RBI Licence for carrying out banking services, cannot be held to be a Co-operative Society within the meaning of section 80P(2)(d) of the act, accordingly, the case of assessee falls within the purview of section 80AC of the Act, the assessee therefore is not eligible for deduction under section 80P of the Act. 6.

In view of the dismissal of appeal by the ld. CIT(A), assessee preferred

Appellant / assessee submissions

Before us ld. Counsel (AR) of the assessee submitted that the decision

Ld AR further placed his reliance on the CBDT’s Circular No. 13/2023

In rebuttal to the aforesaid contention by ld. Sr. DR, ld. AR placed before

Back by aforesaid submissions, it was the prayer by ld. AR that the

and the case law relied upon by the assessee, we find substance in the contentions raised by ld. AR that: (i) The deduction under section 80P(2)(d) can be claimed by an assessee, even if the return is filed belatedly after the prescribed date under section 139(1) of the Act (for AY 2012-13, 2013-14 and 2014-15), as held by the ITAT Mumbai in the case of Sterling Court E Wing (Supra) and also clarified by CBDT Circular No. 13 / 2023. (ii) Regarding this status of Saraswat Co-operative Bank, even if it is a Cooperative Bank, since it continues to be a Co-operative Society also, the 8

Revenue / respondent submissions

Per contra, ld. Sr. DR representing the revenue reiterated the finding AO

In rebuttal to the aforesaid contention by ld. Sr. DR, ld. AR placed before

Court / Tribunal analysis and reasoning

as well as Ld. CIT(A) and submitted that the Saraswat Co-operative Bank from whom the assessee has received interest income is holding a licence from RBI for carrying out the banking services, the same does not fall within the definition of Co-operative Society as per provisions of section 80P, therefore even if the requirement of filing of return before the date prescribed under section 139(1) is not required in present case, the assessee would not be eligible for claim of deduction under section 80P(2)(d), being the interest received from an entity which is not a Co-operative Society. The order of Ld. CIT(A) therefore was justified in denying the deduction u/s 80P to the assessee. 10.

operative Bank was allowed following the decision in the case of Pathare Prabhu Co-operative Housing Society Ltd. Vs. ITO (ITA No. 1346 & 1347/M/2023 decided on 27.07.2023 [2023] 153 taxmann.com 714 (Mum. – Trib.), having following relevant observations: “We are of the considered view, that though the co-operative bank pursuant to the insertion of Sub-section (4) of Sec. 80P would no more be entitled for claim of deduction under Sec. 80P of the Act, but however, as a cooperative bank continues to be a co-operative society registered under the Cooperative Societies Act, 1912 (2 of 1912), or under any other law for the time being enforced in any state for the registration of co-operative societies, therefore, the interest income derived by a co-operative society from its investments held with a co-operative bank, would be entitled for claim of deduction under Sec.80P(2)(d) of the Act." (emphasis supplied by us) 13. We find that the learned CIT(A) has placed reliance upon the decision of the Hon'ble Karnataka High Court in Pr.CIT v/s Totagars Co-operative Sales Society, [2017] 395 ITR 611 (Karn.), wherein it was held that interest earned by the Assessee, a Co-operative Society, from...

assessee in present case is entitled for claiming the deduction under section 80P(2)(d), therefore rejection of such deduction under section 143(1) was uncalled for and the same merits to be rectified under the provisions of section 154 of the Act. Reliance was placed on decision of Hon’ble Supreme Court in the case of T.S. Balaram, Income-tax Officer V/s Volkart Brothers [1971] 82 ITR 50 (SC) [05-08-1971], according to which the AO is required to correct a mistake apparent on record which is obvious and patent on record. 12.

and the case law relied upon by the assessee, we find substance in the contentions raised by ld. AR that: (i) The deduction under section 80P(2)(d) can be claimed by an assessee, even if the return is filed belatedly after the prescribed date under section 139(1) of the Act (for AY 2012-13, 2013-14 and 2014-15), as held by the ITAT Mumbai in the case of Sterling Court E Wing (Supra) and also clarified by CBDT Circular No. 13 / 2023. (ii) Regarding this status of Saraswat Co-operative Bank, even if it is a Cooperative Bank, since it continues to be a Co-operative Society also, the 8

following the Jurisprudence referred to supra, we are of the considered view that the disallowance of exemption claimed under section 80P(2)(d) in processing of return under section 143(1) of the Act and thereafter rejection of rectification under section 154 was not in accordance with the settled principle of law. The assessee herein is entitled for the claim of deduction under section 80P(2)(d) of the Act on receipt of interest income from Saraswat Co-operative Bank, the findings of ld. CIT(A) therefore are liable to be set-aside. We, thus, direct the AO to allow the claim deduction u/s 80P(2)(d) to the assessee, as discussed hereinabove. 14.

Operative decision and relief

appeals in ITA No. 7120 & 7122/M/2025 also, the same are accordingly allowed, in terms of our aforesaid observations. 16.

Sd/(PAWAN SINGH) Judicial Member Mumbai, Dated : 08-01-2026. *SK, Sr. PS Copy of the Order forwarded to : 1. 2. 3. 4. 5.

Authorities and precedents appearing in the judgment

• Supreme Court in CIT v. Vegetable

This list is machine-assisted from the judgment text and is not a substitute for checking the full citation chain in the PDF.

Ratio and legal principle

The decision turns on Section 80P and belated return. The operative result is classified as Quashed / set aside. Read the rule only with the statutory version, factual findings and precedent chain recorded in the full judgment.

Why this judgment matters

The case is relevant to taxpayers, advisers and litigators dealing with Section 80P and belated return. Its practical value lies in the interaction between the statutory text, the evidentiary record and the procedural route followed in this case.

Practitioner action points

• Use the judgment as a fact-specific precedent: match the statutory version, assessment period, procedural stage and evidentiary record before relying on the result.
• Check whether a later High Court/Supreme Court order has affirmed, reversed, distinguished or rendered the decision academic.
• For litigation, attach the full judgment/order to the working paper and cite the paragraph/page supporting the proposition rather than relying on a headnote alone.

Full judgment and source trail

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