PUTHENCRUZ GOVT.SERVANT’S CO-OPERATIVE SOCIETY LTD, vs. THE INCOME TAX OFFICER,

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WP(C)/15154/2023HC KeralaKLHC01032848202308 September 2023Author: HONOURABLE MR. JUSTICE D. K. SINGH9 pages
AI SummaryRemanded

What did the High Court hold?

The High Court disposed of the writ petitions with liberty to the petitioners to file their income tax returns within one month from the date of the order. The Court directed the assessing authority to examine these returns in accordance with the law and pass final assessment orders expeditiously. The Court did not decide on the merits of the exemption claim under Section 80P or the validity of the notices, as the petitioners sought to file returns and pursue their claims through the assessment process. The operative direction was to allow the petitioners to regularize their filing and have their claims adjudicated.

What were the facts?

The petitioners are Co-operative Societies registered under the Kerala Co-operative Societies Act, 1969. For Assessment Year 2019-20, they did not file income tax returns, believing their entire income was exempt under Section 80P of the Income Tax Act, 1961. The Income Tax Officer believed income was concealed and initiated proceedings under Section 148A, leading to orders allowing further action. The petitioners did not file returns in response to these notices. The petitions were filed challenging these notices and subsequent proceedings.

What were the issues?

1. Whether the notices issued under Section 148A and subsequent proceedings for Assessment Year 2019-20 are valid, considering the petitioners' belief of exemption under Section 80P of the Income Tax Act, 1961. Assessee's Contention: The petitioners, being Co-operative Societies, believed their entire income was exempt under Section 80P and thus were not required to file returns. They sought liberty to file returns and raise all available pleas. Revenue's Contention: The assessing authority believed income was concealed and sought to escape assessment, leading to the issuance of notices under Section 148A.

Which sections of the Income-tax Act were involved?

Section 80P,Section 148A,Section 148

AI-generated summary — verify with the full judgment below

Heard together (3 matters)

WP(C) NO. 15059 OF 2023
WP(C).15154/2023
WP(C) NO. 15167 OF 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 FRIDAY, THE 8TH DAY OF SEPTEMBER 2023 / 17TH BHADRA, 1945 WP(C) NO. 15059 OF 2023 PETITIONER/S: THE MUVATTUPUZHA HOUSING CO-OPERATIVE SOCIETY LTD E 299, KAVUMPADY, MUVATTUPUZHA P.O, ERNAKULAM, REPRESENTED BY ITS SECRETARY, PIN - 686661 BY ADV C.A.JOJO RESPONDENT/S: 1 THE INCOME TAX OFFICER, WARD 1 & TPS, THODUPUZHA, TEMPLE ROAD, THODUPUZHA, IDUKKI, PIN - 685584 2 THE PRINCIPAL CHIEF COMMISSIONER, C R BUILDING, I S PRESS ROAD, COCHIN, PIN - 682018 BY ADV CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08.09.2023, ALONG WITH WP(C).15154/2023, 15167/2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) Nos.15059/2023, 15154/2023, 15167/2023 -2- IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH FRIDAY, THE 8TH DAY OF SEPTEMBER 2023 / 17TH BHADRA, 1945 WP(C) NO. 15154 OF 2023 PETITIONER/S: PUTHENCRUZ GOVT.SERVANT'S CO-OPERATIVE SOCIETY LTD, NO. E 153, PUTHENCRUZ P.O, ERNAKULAM, COCHIN -682308, REPRESENTED BY ITS SECRETARY BY ADV C.A.JOJO RESPONDENT/S: 1 THE INCOME TAX OFFICER, NON CORP WARD 1(1), KOCHI, C. R. BUILDING, I.S PRESS ROAD COCHIN-682018 2 THE PRINCIPAL CHIEF COMMISSIONER, C R BUILDING, I S PRESS ROAD, ERNAKULAM COCHIN, PIN - 682018 BY ADV CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT OTHER PRESENT: CHRISTOPHER ABRAHAM-SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08.09.2023, ALONG WITH WP(C).15059/2023 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) Nos.15059/2023, 15154/2023, 15167/2023 -3- IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH FRIDAY, THE 8TH DAY OF SEPTEMBER 2023 / 17TH BHADRA, 1945 WP(C) NO. 15167 OF 2023 PETITIONER/S: KOOTHATTUKULAM FARMERS SERVICE CO-OPERATIVE BANK LTD, E 45, KOOTHATTUKULAM P.O, ERNAKULAM -PIN-686662 REPRESENTED BY ITS MANAGING DIRECTOR. BY ADV C.A.JOJO RESPONDENT/S: 1 THE INCOME TAX OFFICER,WARD 1 & TPS, THODUPUZHA, TEMPLE ROAD, THODUPUZHA, IDUKKI, PIN -685584 2 THE PRINCIPAL CHIEF COMMISSIONER,C R BUILDING, I S PRESS ROAD, ERNAKULAM, COCHIN, PIN – 682018 BY ADV CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08.09.2023, ALONG WITH WP(C).15059/2023 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) Nos.15059/2023, 15154/2023, 15167/2023 -4-

J U D G M E N T

[WP(C) Nos.15059/2023, 15154/2023, 15167/2023]

The present writ petitions have been filed impugning the notices issued under Section 148 of the Income Tax Act 1961 and further proceedings taken pursuant to the notices issued for the Assessment Year 2019-20. 2. The petitioners are Co-operative Societies registered under the provisions of the Kerala Co-operative Societies Act 1969 and Rules made thereunder. The petitioners did not file the return of their income for the Assessment Year 2019-20 on the belief that the petitioners' entire income was exempt under Section 80P of the Income Tax Act, and, therefore, they were not required to file the return of their income.

3.

The assessing authority believes that the petitioners have concealed their income and tried to escape the assessment. The petitioners were therefore issued notices -5-

under Section 148A, and after considering their response, the orders in Ext.P3 were passed for proceeding against them. In response to the orders passed under Section 148 of the Income Tax Act, the petitioners have not filed their return of income.

4.

After some argument, the learned Counsel for the petitioners submits that these petitions may be disposed of with liberty to the petitioners to file the return of income and take all the pleas which are available to them under the law in respect of their claim for their income being jumped under Section 80P of the Income Tax Act.

5.

Considering the said submission, the present writ petitions are disposed of with liberty to the petitioners to file returns of their income within a period of one month from today. If the petitioners file their return of income within a period of one month from today, the assessing authority will examine the return in accordance with the law and pass the final assessment orders expeditiously.

-6-

With the aforesaid direction, the writ petitions stand finally disposed of. DINESH KUMAR SINGH JUDGE

jjj -7-

Appendix — schedule of exhibits
APPENDIX OF WP(C) 15154/2023 PETITIONER EXHIBITS Exhibit P1 A TRUE COPY OF THE NOTICE U/S 148A(B) DATED 08.02.2023 ISSUED BY THE 1ST RESPONDENT Exhibit P2 A TRUE COPY OF THE REPLY SUBMITTED TO THE 1ST RESPONDENT DATED 14.02.2023 Exhibit P3 A TRUE COPY OF THE ORDER UNDER CLAUSE (D) OF S.148A DATED 22.03.2023 ISSUED THE 1ST RESPONDENT Exhibit P4 A TRUE COPY OF THE STATUS QUO ORDER IN WP ( C) 24112 OF 2019 DATED 04.09.2019 Exhibit P5 A TRUE COPY OF THE STAY ORDER IN WP ( C) 4368 OF 2023 DATED 12.04.2023 RESPONDENT EXHIBITS Exhibit R1(a) copy of the Supreme Court judgment dated 02.09.2022 in the case of anshul Jain v. Principal Commissioner of Income tax and another [2022] 449 ITR 256 (SC) Exhibit R1 (b) Copy of the judgment of the Punjab and Haryana High Court in the case of Anshul Jain v. Principal Commissioner of Income Tax dated 02.06.2022 [2022] 449 ITR 251 (P and H) Exhibit R1(c) Copy of the judgment of the Kerala High Court dated 07.12.2022 in W.P. (C) No. 37527 of 2022 in the case of M/s Viswabharathi Medicals v. Income Tax Officer W.P.(C) Nos.15059/2023, 15154/2023, 15167/2023 -8- APPENDIX OF WP(C) 15167/2023 PETITIONER EXHIBITS Exhibit P1 A TRUE COPY OF THE LETTER DATED 30.01.2023 ISSUED BY THE 1ST RESPONDENT Exhibit P2 A TRUE COPY OF THE REPLY SUBMITTED TO THE 1ST RESPONDENT DATED 10.02.2023 Exhibit P3 A TRUE COPY OF THE NOTICE U/S 148A(B) DATED 28.02.2023 ISSUED BY THE 1ST RESPONDENT Exhibit P4 THE RELEVANT PAGE OF COPY OF THE AUDITED BALANCE SHEET AND PROFIT AND LOSS STATEMENT OF THE PETITIONER FOR FY 2018-19 DATED 23.09.2019 Exhibit P5 A TRUE COPY OF THE STATUS QUO ORDER IN WP ( C) 24112 OF 2019 DATED 04.09.2019 Exhibit P6 A TRUE COPY OF THE STAY ORDER IN WP ( C) 4368 OF 2023 DATED 12.04.2023 RESPONDENT EXHIBITS Exhibit R1(a) Copy of the Supreme Court judgment dated 02.09.2022 in the case of Anshul Jain v. Principal Commissioner of Income Tax and another [2022] 449 ITR 256 (SC) Exhibit R1 (b) Copy of the judgment of the Punjab and Haryana High Court in the case of Anshul Jain v. Principal Commissioner of Income Tax dated 02.06.2022 [2022] 449 ITR 251 (Pand H) Exhibit R1(c) Copy of the judgment of the Kerala High Court dated 07.12.2022 in W.P.(C). No.37527 of 2022 in the case of m/s Viswabharathi Medicals v. Income Tax Officer Exhibit R1(d) True copy of the order dated 23.03.2023 passed under clause (d) of section 148A of the Income Tax Act. Exhibit R1(e) True copy of notice under section 148 of the Income Tax Act dated 27.03.2023 calling for return of income for Assessment Year 2019-20 W.P.(C) Nos.15059/2023, 15154/2023, 15167/2023 -9- APPENDIX OF WP(C) 15059/2023 PETITIONER EXHIBITS Exhibit P1 A TRUE COPY OF THE NOTICE U/S 148A(B) DATED 02.03.2023 ISSUED BY THE 1ST RESPONDENT Exhibit P2 A TRUE COPY OF THE REPLY SUBMITTED TO THE 1ST RESPONDENT DATED 10.02.2023 Exhibit P3 A TRUE COPY OF THE ORDER UNDER CLAUSE (D) OF S.148A DATED 25.03.2023 ISSUED THE 1ST RESPONDENT Exhibit P4 A TRUE COPY OF THE NOTICE U/S S.148 DATED 2703.2023 ISSUED THE 1ST RESPONDENT Exhibit P5 A TRUE COPY OF THE STATUS QUO ORDER IN WP ( C) 24112 OF 2019 DATED 04.09.2019 Exhibit P6 A TRUE COPY OF THE STAY ORDER IN WP ( C) 4368 OF 2023 DATED 12.04.2023 RESPONDENT EXHIBITS Exhibit R1(a) Copy of the Supreme Court decision dated 02.09.2022 in the case of Anshul Jain v Principal Commissioner of Income Tax and Another {2022} 449 ITR 256 (SC) Exhibit R1 (b) Copy of the Judgment of the Punjab and Haryana High Court in the case of Anshul Jain v. Principal Commissioner of Income Tax dated 02.06.2022, [2022] 449 ITR 251 (P and H) Exhibit R1(c) Copy of the Judgment of the Kerala High Court dated 07.12.2022 in W.P.(C) No. 37527 of 2022 in the case of M/s Viswabharathi Medicals v. Income Tax Officer

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