IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH : BANGALORE BEFORE SHRI PRASHANT MAHARISHI, VICE – PRESIDENT AND SHRI SOUNDARARAJAN K., JUDICIAL MEMBER Assessment Year : 2020-21 Sri Vishnu Vilas Souharda Pattina Sahakari Sanghas The Income Tax Niyamita, Officer, Panchamukhi Nilaya, Ward – 1 & TPS, Adoni Road, Ballari.

Vs.

Siruguppa – 583 121.

PAN: AAIAS6297E APPELLANT RESPONDENT Assessee by : Shri H. Siva Prasad Reddy, ITP Revenue by : Shri Subramanian S, JCIT-DR Date of Hearing : 17-11-2025 Date of Pronouncement : 31-12-2025

ORDER

PER SOUNDARARAJAN K., JUDICIAL MEMBER This is an appeal filed by the assessee challenging the order dated

22/03/2025 passed by the Ld.PCIT u/s. 263 of the Act in respect of the A.Y.

2020-21 and raised the following grounds:

“1. The impugned order u/s 263, dated, 22.03.2025 is opposed to the facts of the case and the law, as it is passed in haste violating the principles of natural justice and ignoring the submissions/ the material on record and therefore, liable to be set-aside.

Revision u/s 263.

2. The Learned PCIT failed to appreciate that the assessment order u/s 143(3) r.w.s 144B dated, 20.09.2022, was neither erroneous nor prejudicial to the interest of the revenue, because:

(i). The learned AO conducted specific enquiry on the issue of assessability of interest income accruing on statutory investments made in co-operative banks.

(ii). The view taken by the learned AO regarding the allowability of deduction u/s 80P is not merely a possible view, but the correct view and therefore, there was no error.

(iii). It was demonstrated before the PCIT that the interest income accrued on statutory investments, entailing the deduction u/s 80P(2)(a)(i).

(iv). It was alternatively demonstrated that the interest income is eligible for the deduction u/s 80P(2)(d) and there was no loss/prejudice to the Revenue.

3. The Appellant craves leave to add or delete or modify or revise any ground at the time of hearing before the Hon'ble Tribunal.

For these and other grounds that may be urged at the time of hearing, it is prayed that the Hon'ble Tribunal may be pleased to allow the appeal in the interest of the equity and justice.”

2. The present appeal has been filed with a delay of 38 days and the assessee also filed an application to condone the said delay. In the said application, the assessee submitted that because of the wrong advice given by their consultants, the assessee was not able to file the appeal in time. Later on, the assessee came to know that the consequential order could be challenged before the appellate authority but the grounds for revising the assessment order could not be challenged before the appellate authority and therefore the assessee was advised to file the appeal, challenging the section 263 order of the Ld.PCIT. Therefore the delay has been occurred and being a co-operative society, the said delay is neither wilful nor wanton and therefore prayed to condone the said delay and decide the appeal on merits.

3. We have considered the said application and the submissions made by the assessee and we are satisfied that the delay is not a wilful one and in order to render substantial justice, we are inclined to condone the said delay and proceeded to decide the appeal on merits.

4. The brief facts of the case are that the assessee is a credit co-operative society registered under the provisions of the Karnataka Souharda Sahakari Act, 1997. The assessee filed the return of income and claimed the deduction under Chapter VIA of the Act on the interest income earned by it through the statutory deposits made with the banks. The said return was taken up for complete scrutiny and notice u/s. 142(1) was issued on 10/11/2021. The assessee also filed their detailed reply along with the documents on 28/11/2021. In the said reply, the assessee had given the details about the interest received from the co-operative banks as well as the scheduled banks and explained that the interest is on the short term deposits. In the said r