25 January 2022
IN CASE OF CO OPERATIVE SOCIETY IN ADVERTANTLY DEDUCTION HAS BEEN TAKEN IN 80P(2)(D) INSTEAD OF 80P(2)(B) DUE TO WHICH DEMAND HAS BEEN RAISED BY OFFICER, WHAT TO DO IN THIS SCENARIO?
10 July 2024
In the scenario where a Cooperative Society has inadvertently claimed deduction under Section 80P(2)(D) instead of Section 80P(2)(B), resulting in a demand raised by the tax officer, here’s what can be done to rectify the situation:
### Steps to Address the Issue:
1. **Assess the Error:** - Review the notice issued by the tax officer carefully to understand the specifics of the demand raised. Identify whether the demand pertains solely to the incorrect deduction claimed under Section 80P(2)(D) instead of 80P(2)(B).
2. **Prepare Documentation:** - Gather all relevant documents related to the Cooperative Society's activities, income sources, and the nature of deductions claimed under Section 80P(2)(B). This includes audited financial statements, income details, and any other records that support the correct claim.
3. **Consult a Tax Expert:** - Engage a tax consultant or expert who specializes in Cooperative Societies and tax matters. They can provide specific advice tailored to your situation, review the notice, and guide you on the best course of action.
4. **Respond to the Notice:** - Prepare a detailed response addressing the inadvertent error in claiming the deduction under Section 80P(2)(D) instead of 80P(2)(B). Clearly explain the circumstances leading to the error and provide documentary evidence supporting the correct deduction under 80P(2)(B).
5. **Rectification Process:** - Follow the procedure outlined by the tax authority for rectifying errors in tax filings or deductions. This typically involves submitting a rectification request or filing an appeal (if required) to correct the mistake and reverse the demand raised.
6. **Compliance and Communication:** - Ensure timely compliance with any deadlines provided in the notice. Maintain clear communication with the tax officer or department, responding promptly to any queries or requests for additional information.
### Key Considerations:
- **Documentation:** Complete and accurate documentation is crucial to substantiate the correct deduction under Section 80P(2)(B).
- **Professional Assistance:** Given the technicalities involved in tax laws and deductions for Cooperative Societies, seeking professional guidance ensures adherence to legal requirements and maximizes the chances of a favorable resolution.
By following these steps and seeking appropriate professional advice, the Cooperative Society can rectify the inadvertent error in claiming the deduction under the wrong section and address the demand raised by the tax officer effectively.
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