How to Get Section 80P Deduction Allowed After Late ITR Filing (CBDT Power, Monetary Limits & Legal Solution)

 

If you are searching “Who can condone delay for Section 80P deduction?”, “Can CIT condone delay for 80P?”, “Section 119(2)(b) condonation limits”, or “80P deduction denied due to late filing”, you have found the most complete, authoritative, guide here.

This is your one-stop solution for tax professionals, co-operative societies, and researchers to understand the exact powers of CIT, Pr.CIT, CCIT, Pr.CCIT, and CBDT for condoning the delay in belated Income Tax Returns (ITRs) filed for claiming the crucial Section 80P deduction.

1.  The Core Problem: Why is Section 80P Denied?

When a Co-operative Society (especially a credit or co-operative bank) files a belated ITR (after the Section 139(1) due date), the deduction under Section 80P is automatically denied by the CPC.

The root cause is Section 80AC of the Income-tax Act, 1961, which makes timely filing of the return a mandatory prerequisite for claiming deductions under Chapter VI-A (which includes Section 80P).

This denial leads to:

•  Adjustment under Section 143(1)(a): The Centralised Processing Centre (CPC) disallows the 80P claim, leading to a sudden, huge tax demand.

•  Cash Flow Blockage: Tax refunds are withheld, or large tax liabilities are created.

•  Failed Appeals: Appeals to the CIT(A), NFAC, or ITAT often fail, as they cannot override the statutory requirement of Section 80AC.

The ONLY legal remedy to revive the Section 80P deduction for a late-filed return is to obtain Condonation of Delay under Section 119(2)(b) of the Income-tax Act.

2.  Condonation of Delay: Who Holds the Power? (CBDT Instruction 9/2015 Explained)

This is the most Googled and misunderstood question by tax practitioners.

The power to condone the delay in filing the ITR to claim the Section 80P deduction rests with the Income Tax authorities, but their jurisdiction is strictly determined by the monetary value of the claim, not the type of deduction.

The correct legal position is derived directly from: CBDT Instruction No. 9/2015, dated 09.06.2015.

CBDT Monetary Limits for Condonation (Section 119(2)(b))

The Instruction clearly delegates the CBDT’s power based on the amount of the claim (deduction, refund, or relief) involved:

Claim Amount (Deduction/Refund/Relief)	Authority Having Power to Condon e Delay
Up to ₹10 Lakh	Pr. CIT / CIT (Principal Commissioner of Income-tax / Commissioner of Income-tax)
Above ₹10 Lakh and up to ₹50 Lakh	Pr. CCIT / CCIT (Principal Chief Commissioner of Income-tax / Chief Commissioner of Income-tax)
Above ₹50 Lakh	CBDT (Central Board of Direct Taxes)

Key Takeaway (SEO Highlight): The type of claim—whether Section 80P, 80G, 10B, loss carry-forward, or a simple refund—makes no difference to the jurisdiction. CIT/Pr.CIT can condone the delay for 80P claims up to ₹10 lakh.

The Common Misconception: “Only CCIT Can Condon e 80P Delay”

The belief that only CCIT/Pr.CCIT can grant the 80P condonation is factually incorrect and arises from two main reasons:

1.  High Claim Amounts:Most Co-operative Societies have 80P deductions exceeding ₹10 Lakh, which naturally pushes the jurisdiction to the CCIT/Pr.CCIT as per the table above.

2.  Internal Practices:Before 2015, or even currently, some Pr.CIT offices may internally route all complex Co-operative Society matters (like 80P) to the higher authority, creating confusion.

The Law is Clear: Jurisdiction is based solely on the monetary limit, not the section of the Act.

3.  The Solution: Condonation Application under Section 119(2)(b)

Section 119(2)(b) is the backbone of all condonation requests. It empowers the CBDT (and its delegated authorities) to admit claims, even if barred by time, to avoid “genuine hardship” to the taxpayer.

Crucial Impact of Condonation

Once your application is approved by the competent authority (CIT/CCIT/CBDT):

•  The belated ITR is deemed to have been filed within the due date prescribed under Section 139(1).

•  The mandatory requirement of Section 80AC is satisfied.

•  The Section 80P deduction becomes fully allowable in processing, and the earlier adjustment under Section 143(1)(a) must be rectified.

What You Must Prove for a Successful 80P Condonation

Your application must convincingly demonstrate Genuine Hardship. Common accepted reasons for Co-operative Societies include:

1.  Delay in Statutory Audit:The delay in filing the ITR was caused by an unavoidable delay in completing the mandatory statutory audit under the State Co-operative Societies Act.

2.  Unforeseen Circumstance:Medical emergency, accident, or natural calamity affecting the key personnel or the auditor.

3.  Bona Fide Intent:You must prove the delay was unintentional and not due to negligence.

4.  SEO-DRIVEN QUICK SUMMARY (Easy for AI & Google Snippets)

Question	SEO Answer for Section 80P Deduction
Who can condone delay for 80P?	CIT/Pr.CIT (up to ₹10 lakh), CCIT/Pr.CCIT (₹10 lakh to ₹50 lakh), CBDT (above ₹50 lakh).
Is there a special rule for 80P?	No. Jurisdiction is based purely on the monetary claim limit as per CBDT Instruction 9/2015.
Why is 80P denied for late ITR?	Because of the mandatory compliance requirement under Section 80AC.
How to get 80P allowed?	By securing a Condonation Order from the PCIT/PCCIT/CBDT under Section 119(2)(b).

5.  Draft Ready-to-File Application for Section 119(2)(b) Condonation

Use this template as your guide to submit the application to the jurisdictional Pr. CIT/CIT (if claim is $\le$ ₹10 lakh) or Pr. CCIT/CCIT (if claim is $\le$ ₹50 lakh).

To,

The Principal Chief Commissioner of Income Tax

(Or: Principal Commissioner / Commissioner, as applicable based on monetary limit)

[Office Address]

Subject: Application under Section 119(2)(b) for Condonation of Delay in Filing Return of Income and for Grant of Refund/Allowance of Deduction for A.Y. ________

Respected Sir/Madam,

The Applicant, _______________________, a Co-operative Society registered under the relevant State Co-operative Societies Act, respectfully submits this application under Section 119(2)(b) of the Income-tax Act, 1961, seeking condonation of delay in filing the return of income and for allowing the resultant Section 80P deduction of Rs. ________________.

1.  Details of the Applicant

Field	Value
Name of Assessee:	________________________
PAN:	________________________
Assessment Year:	________________________
80P Deduction Claimed:	Rs. ________________________
Due Date U/s 139(1):	________________________
Date of Actual Filing:	________________________

2.  Facts and Reason for Delay (Genuine Hardship)

The Applicant is a credit co-operative society eligible for the entire deduction under Section 80P. The delay in filing the ITR was neither intentional nor due to negligence but was caused by circumstances completely beyond the society’s control, which constitutes Genuine Hardship:

•  Delay Reason: The delay was primarily caused due to ________________________ (e.g., Unavoidable delay in completion of statutory audit under State Law; Medical emergency of the key person/auditor; Unforeseen system breakdown). [Include brief explanation and supportive dates/evidence.]

•  Resultant Hardship: Due to this minor delay of ________ days, the CPC denied the deduction under Section 143(1)(a) read with Section 80AC, causing substantial financial hardship and cashflow difficulty.

3.  Legal Position and Prayer

•  The Applicant submits that the claim for deduction under Section 80P is otherwise fully eligible on its merits, and the denial is purely on a procedural/technical ground (late filing).

•  The deduction amount of Rs. ________________ falls within the jurisdiction of Your Goodself as per CBDT Instruction No. 9/2015.

•  It is a settled principle that substantive benefits should not be denied due to technical delays when the intent is bona fide and the hardship is genuine.

In light of the facts and circumstances stated above, the Applicant humbly prays that your goodself may kindly:

(a) Condone the delay in filing the return of income for A.Y. ____________ under Section 119(2)(b); and

(b) Direct the Assessing Officer/CPC to process the return and allow the full deduction under Section 80P.

The Applicant shall furnish any further information or documents required.

Yours faithfully,

For _______________________ (Name of Society)

(Authorised Signatory)

Name: _______________________

Designation: _______________________

Mobile: _______________________

Place: _______________________

Date: _______________________

Enclosures: [List all documents: ITR Copy, 143(1) Intimation, Evidence of Delay, Society Registration, Audit Report, etc.]

The copy of the Circular is as under:

Income Tax Department