KADAVALLOOR SERVICE CO-OPERATIVE BANK LTD. NO. 3821 vs. THE INCOME TAX OFFICER

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WP(C)/31648/2023HC KeralaKLHC01070210202327 September 2023Author: HONOURABLE MR. JUSTICE D. K. SINGH7 pages
AI SummaryRemanded

What did the High Court hold?

The High Court held that it cannot direct the refund of the tax amount since the tax has already been realized from the petitioner's bank account in the State Bank of India, and the bank has remitted the amount to the Department. Therefore, the writ petitions are disposed of with a direction to the Income Tax Appellate Tribunal (ITAT) to dispose of the pending appeals filed by the petitioner expeditiously, preferably within a period of three months from the date of receipt of a copy of the judgment. The ITAT's decision on the merits of the appeals is not recorded, nor is any finding on the assessment orders or penalty proceedings. The operative direction is for the ITAT to expedite the disposal of the appeals.

What were the facts?

The petitioner, Kadavalloor Service Co-operative Bank Ltd., filed two writ petitions before the High Court of Kerala. WP(C) No. 31648/2023 challenged an assessment order dated 31.12.2015 for assessment year 2008-2009, passed under Section 144 of the Income Tax Act, 1961, assessing total income at Rs. 1,15,140, and initiating penalty proceedings under Sections 271F, 271B, and 271(1)(c). WP(C) No. 31660/2023 challenged an order dated 19.11.2018 for assessment year 2010-11, passed under Section 143(3) read with Section 147, assessing total income at Rs. 30,08,820 and levying tax and interest of Rs. 26,87,180. Appeals against these orders were dismissed by the Commissioner of Income Tax Appeals. The petitioner then filed appeals before the Income Tax Appellate Tribunal (ITAT). No interim order was granted by the ITAT, and garnishee notices led to the attachment of the petitioner's bank account in the State Bank of India. The bank has remitted Rs. 27,77,170 to the Department.

What were the issues?

1. Whether the High Court can direct a refund of tax already realized from the petitioner's bank account, given that the tax amount has been remitted by the State Bank of India pursuant to garnishee notices. (Question of law) Assessee's Contention: The petitioner, a co-operative society, is challenging the assessment orders and subsequent actions by the Income Tax Department. While specific arguments on the merits of the assessment orders are not detailed in this judgment, the filing of appeals before the ITAT indicates a dispute over the correctness of the assessments and penalties. The petitioner sought an interim order from the ITAT, which was not granted. Revenue's Contention: The Revenue initiated assessment and penalty proceedings and, following the dismissal of appeals by the CIT(A), proceeded to attach the petitioner's bank account through garnishee notices. The Revenue has received the tax amount from the State Bank of India.

Which sections of the Income-tax Act were involved?

Section 144,Section 271F,Section 271B,Section 271(1)(c),Section 143(3),Section 147,Section 253

AI-generated summary — verify with the full judgment below

Heard together (2 matters)

WP(C) NO. 31648 OF 2023
WP(C).31660/2023

Read from the judgment's own cause title. This page is filed under one of them.

Cause title — parties, addresses and appearances
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH WEDNESDAY, THE 27TH DAY OF SEPTEMBER 2023 / 5TH ASWINA, 1945 WP(C) NO. 31648 OF 2023 PETITIONER: KADAVALLOOR SERVICE CO-OPERATIVE BANK LTD. NO. 3821 KADAVALLOOR, P.O.KADAVALLUR THRISSUR DISTRICT , REPRESENTED BY ITS SECRETARY., PIN - 680543 BY ADV P.C.SASIDHARAN RESPONDENTS: 1 THE INCOME TAX OFFICER WARD I & TPS, INCOME TAX OFFICE, CITY PLAZA, WEST NADA, GURUVAYOOR, PIN - 680101 2 STATE BANK OF INDIA PERUMPILAVU BRANCH, TRIVENI PLAZA, PERUMPILAVU, THRISSUR, PIN - 680519 ADV.A. KUMAR- SBI ADV.JOSE JOSEPH – INCOME TAX DEPARTMENT THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 27.09.2023, ALONG WITH WP(C).31660/2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WPC Nos.31648 & 31660 of 2023 2 IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH WEDNESDAY, THE 27TH DAY OF SEPTEMBER 2023 / 5TH ASWINA, 1945 WP(C) NO. 31660 OF 2023 PETITIONER: KADAVALLOOR SERVICE CO-OPERATIVE BANK LTD. NO. 3821 KADAVALLOOR, P.O.KADAVALLUR THRISSUR DISTRICT REPRESENTED BY ITS SECRETARY., PIN - 680543 BY ADV P.C.SASIDHARAN RESPONDENTS: 1 THE INCOME TAX OFFICER WARD I & TPS, INCOME TAX OFFICE, CITY PLAZA, WEST NADA, GURUVAYOOR, PIN - 680101 2 STATE BANK OF INDIA PERUMPILAVU BRANCH, TRIVENI PLAZA, PERUMPILAVU, THRISSUR, PIN - 680519 ADV.A. KUMAR- SBI ADV.JOSE JOSEPH – INCOME TAX DEPARTMENT THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 27.09.2023, ALONG WITH WP(C).31648/2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WPC Nos.31648 & 31660 of 2023 3 JUDGMENT Dated this the 27th day of September, 2023 1. These writ petitions have been filed under Article 226 of the Constitution of India by the petitioner, an Agricultural Credit Co-operative Society. Ext.P1 assessment order dated 31.12.2015 in W.P.(C.) No.31648/2023 was passed regarding the income of the petitioner for the assessment year 2008-2009 under Section 144 of the Income Tax Act, 1961. The petitioner’s total income was assessed as Rs.1,15,140/-. Therefore, penalty proceedings under Sections 271F, 271B and 271(1) (C) was separately initiated. 2. In W.P.(C.) No.31660/2023 Ext.P1 order was passed on 19.11.2018 under Section 143(3) read with Section 147 for the assessment year 2010-11, assessing the the petitioner’s total income was assessed as Rs.30,08,820/- on which tax and interest as Rs.26,87,180/- were levied. The petitioner challenged the assessment orders before the Commissioner of Income Tax Appeals. The Appellate Authority has dismissed the appeals. WPC Nos.31648 & 31660 of 2023 4 Against the dismissal of the same, petitioner has filed appeals under Section 253 before the Income Tax Appellate Tribunal as Exts.P5 and P6 in respect of the assessment year 2008-9 and 2010-11 respectively. However, the petitioner has not been granted any interim order and garnishee notices were issued by the Department and the petitioner’s bank account in the State Bank of India was attached. 3. Learned Standing Counsel for the State Bank of India submits that the bank has already remitted an amount of Rs.27,77,170/- in respect of the garnishee notices to the Department in respect of both assessment years. 4. Considering the fact that the tax amount has already been realised from the account of the petitioner maintained in the State Bank of India, this Court cannot direct to refund of the tax amount and therefore, the present writ petitions are disposed of with a direction to the Income Tax Appellate Tribunal to dispose of the pending appeals filed by the petitioner, expeditiously, WPC Nos.31648 & 31660 of 2023 5 preferably within a period of three months from the date

of receipt of a copy of this judgment. DINESH KUMAR SINGH JUDGE AP APPENDIX OF WP(C) 31648/2023 PETITIONER EXHIBITS Exhibit P1 THEOF THE ASSESSMENT ORDER DATED 31/12/2015 ALONG WITH THE STATEMENT OF CALCULATION Exhibit P2 THEOF THE DEMAND NOTICE DATED 31/12/2015 Exhibit P3 THEOF THE APPEAL MEMORANDUM DATED 03/02/2016 Exhibit P4 THEOF THE ORDER DATED 29/5/2023 ISSUED BY THE COMMISSIONER OF INCOME TAX (APPEALS)

Exhibit P5 THEOF THE APPEAL DATED 6/9/2023 FILED BY THE PETITIONER BEFORE THE INCOME TAX APPELLATE TRIBUNAL Exhibit P6 THEOF THE ACKNOWLEDGEMENT OF E- FILING OF INCOME TAX APPEAL DATED 7/9/2023 Exhibit P7 THEOF THE STAY PETITION DATED 19/9/2023 FILED BY THE PETITIONER BEFORE THE APPELLATE TRIBUNAL Exhibit P8 THEOF THE ACKNOWLEDGEMENT OF E- FILING OF STAY APPLICATION DATED 19/9/2023 Exhibit P9 THEOF THE PETITION DATED 21/9/2023 FILED BY THE PETITIONER BEFORE THE APPELLATE TRIBUNAL Exhibit P10 THEOF THE NOTICE DATED 18/9/2023 ISSUED BY THE 1ST RESPONDENT Exhibit P11 THEOF THE STATEMENT OF ACCOUNTS FURNISHED BY THE 2ND RESPONDENT Exhibit P12 THEOF THE JUDGMENT DATED 20/01/2020 IN W.A.NO. 2488 OF 2019 Exhibit P13 THEOF THE JUDGMENT IN W.P(C).NO. 8822/2020 DATED 23/03/2020 APPENDIX OF WP(C) 31660/2023 PETITIONER EXHIBITS Exhibit P1 THEOF THE ASSESSMENT ORDER DATED 19/11/2018 ALONG WITH THE STATEMENT OF CALCULATION Exhibit P2 THEOF THE DEMAND NOTICE DATED 19/11/2018 Exhibit P3 THEOF THE APPEAL MEMORANDUM DATED 28/12/2018 Exhibit P4 THEOF THE JUDGMENT DATED 18/3/2020 IN W.P(C) NO.8577/2020 Exhibit P5 THEOF THE ORDER DATED 31/5/2023 ISSUED BY THE COMMISSIONER OF INCOME TAX (APPEALS)

Exhibit P6 THEOF THE APPEAL DATED 7/9/2023 FILED BY THE PETITIONER BEFORE THE INCOME TAX APPELLATE TRIBUNAL Exhibit P7 THEOF THE ACKNOWLEDGEMENT OF E- FILING OF INCOME TAX APPEAL DATED 9/8/2023 Exhibit P8 THEOF THE STAY PETITION DATED 19/9/2023 FILED BY THE PETITIONER BEFORE THE APPELLATE TRIBUNAL Exhibit P9 THEOF THE ACKNOWLEDGEMENT OF E- FILING OF STAY APPLICATION DATED 19/9/2023 Exhibit P10 THEOF THE PETITION DATED 21/9/2023 FILED BY THE PETITIONER BEFORE THE APPELLATE TRIBUNAL Exhibit P11 THEOF THE NOTICE DATED 18/9/2023 ISSUED BY THE 1ST RESPONDENT Exhibit P12 THEOF THE STATEMENT OF ACCOUNTS FURNISHED BY THE 2ND RESPONDENT Exhibit P13 THEOF THE JUDGMENT DATED 20/01/2020 IN W.A.NO. 2488 OF 2019 Exhibit P14 THEOF THE JUDGMENT IN W.P(C).NO.8822/2020 DATED 23/03/2020

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