आयकर अपीलीय अिधकरण, ‘ए’ (cid:13)ायपीठ, चे(cid:18)ई।

IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH: CHENNAI (cid:21)ी यस यस िव(cid:24)ने(cid:26) रिव, (cid:13)ाियक सद(cid:28) एवं सु(cid:21)ी पदमावती यस, लेखा सद(cid:28) के सम"

BEFORE SHRI SS VISWANETHRA RAVI, JUDICIAL MEMBER AND MS. PADMAVATHY.S, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.2260/Chny/2025 िनधा#रण वष# /Assessment Year: 2018-19 Angalakshmi Spinning Mill, The Income Tax Officer, 154/1, Mathakadi Thottam, Vs. Non Corporate Ward-4(1), Chintamanipudur, Coimbatore.

Coimbatore – 641 103. PAN: AACFA 3911G (अपीलाथ(cid:7)/Appellant) ((cid:8)(cid:9)यथ(cid:7)/Respondent)

अपीलाथ& की ओर से/ Appellant by : Mr. A. Arjun Raj, C.A (virtual)

()थ& की ओर से /Respondent by : Ms. Latchana, JCIT सुनवाई की तारीख/Date of Hearing : 18.12.2025 घोषणा की तारीख /Date of Pronouncement : 07.01.2026 आदेश / O R D E R PER PADMAVATHY.S, A.M:

This appeal by the assessee is against the order of the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi, (in short "CIT(A)") passed u/s. 250 of the Income Tax Act, 1961 ( in short "the Act") dated 18.06.2025 for Assessment Year (AY) 2018-19. The assessee raised the following grounds of appeal:

“1. The CIT(A) is erred in upholding the notice issued u/s 143(2) as valid eventhough it is invalid and the consequent assessment is to be set aside for the following reasons.

a. Interest income is not the subject matter in the reasons mentioned and no approval u/s 153(1) was obtained from higher authorities.

b. There was no mention in the notice whether it is for Limited Scrutiny or complete scrutiny.

2. The allegation of the assessing officer and CIT(A) that the assessee claimed the interest income as business income and claimed deduction u/s 801A is factually incorrect and against his own finding in the draft assessment order and CIT(A) is erred in upholding the same.

3. The levy of interest of Rs. 9,320/- u.s 234A and Rs. 51,292/- u.s 234C are not correct and CIT(A) is not correct in not deleting the same.

4. The appellants reserve the right to adduce any additional or alternate grounds.

5. In the circumstances it is prayed to delete the addition of Rs. 14,32,945/- and delete the interest levied u/s 234A and 234C or pass such other order in the interest of justice.”

2. The assessee is a partnership firm and filed the return of income for A.Y 2018-19 on 23.10.2018 declaring total income at Nil after claiming deduction under Chapter-VIA to the tune of Rs. 2,49,74,166. The case was selected for scrutiny and the statutory notices were duly served on the assessee. The A.O noticed that during the year under consideration, the assessee has earned interest income to the tune of Rs. 14,32,945/- and called on the assessee to show cause why the deduction u/s. 80IA of the Act cannot be denied against the interest income. The assessee submitted before the A.O that the impugned interest is not included while claiming deduction u/s. 80IA of the Act and therefore, no disallowance warranted. The A.O however did not accept the submissions of the assessee and held that interest income which is to be taxed under the head income from other sources cannot be included in the gross total income against which deduction under section 80IA of the Act is to be claimed. Accordingly the AO restricted the deduction u/s.80IA and made addition towards interest income under the head income from other sources. Aggrieved, the assessee filed further appeal before the CIT(A), who confirmed the action of the A.O. Aggrieved, the assessee is in further appeal before the Tribunal.

3. The Ld. AR submitted that while computing the deduction u/s. 80IA of the Act, the assessee has not included the interest income and in this regard our attention was drawn to the below workings of deduction us/. 80IA of the Act.

4. The ld AR accordingly argued that the contention of the A.O. that the interest income is included while claiming deduction u/s.80IA is factually incorrect. The ld AR further submitted that