INCHAKUNDU SERVICE CO- OPERATIVE BANK LTD. vs. THE INCOME TAX OFFICER,

WP(C)/12645/2023HC KeralaKLHC01027874202310 April 2023Author: HONOURABLE MR. JUSTICE T.R.RAVI4 pages
AI SummaryRemanded

What were the facts?

The petitioner, Inchakundu Service Co-operative Bank Ltd., a Primary Agricultural Credit Co-operative Society, is challenging an assessment order (Ext.P1) passed by the Income Tax Officer. The order rejected the society's claim for deduction under Section 80P of the Income Tax Act. The rejection was based on the ground that the petitioner did not satisfy the ingredients of a Primary Agricultural Credit Society as defined under the Kerala Co-operative Societies Act. The petitioner has filed an appeal (Ext.P2) before the Commissioner of Income Tax (Appeals), which is pending. The petitioner is seeking a direction for the expeditious disposal of this appeal and a stay on coercive steps.

What did the High Court hold?

The High Court of Kerala did not decide the merits of the case. Instead, it noted that the petitioner had already availed the statutory remedy by filing an appeal (Ext.P2) before the 3rd respondent (Commissioner of Income Tax (Appeals)). Therefore, the writ petition was disposed of by directing the Appellate Authority to consider and pass orders on the appeal at the earliest. The Court also directed that no coercive steps shall be taken against the petitioner pursuant to the assessment order (Ext.P1) until the appeal is disposed of. The specific finding on the eligibility for deduction under Section 80P was left to be decided by the appellate authority.

What were the issues?

1. Whether the petitioner, a Primary Agricultural Credit Co-operative Society, is entitled to deduction under Section 80P of the Income Tax Act, 1961, when the Assessing Officer held that it did not satisfy the ingredients of a Primary Agricultural Credit Society as contemplated under the Kerala Co-operative Societies Act, 1969. Assessee's Contention: The petitioner relies on the judgment of the Hon'ble Supreme Court in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax; 2021 (1) KLT 485 to challenge the assessment order, implying that such a deduction should be allowed. Revenue's Contention: The revenue, through the Assessing Officer, rejected the deduction on the basis that the petitioner did not meet the statutory definition of a Primary Agricultural Credit Society under the relevant state act.

Which sections of the Income-tax Act were involved?

Section 80P

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE T.R.RAVI MONDAY, THE 10TH DAY OF APRIL 2023 / 20TH CHAITHRA, 1945 WP(C) NO. 12645 OF 2023 PETITIONER: INCHAKUNDU SERVICE CO- OPERATIVE BANK LTD. MUPLIYAM, THRISSUR,PIN – 680312 REPRESENTED BY ITS SECRETARY SMT. K.A JAICY BY ADVS. K.S.HARIHARAN NAIR G.REMADEVI RESPONDENTS: 1 THE INCOME TAX OFFICER, WARD 2(2), AAYAKAR BHAVAN, SAKTHAN THAMPURAN NAGAR, THRISSSUR, PIN - 680001 2 ASSESSMENT UNIT NEAC, MAYUR BHAWAN, CONNAUGHT LANE, NEW DELHI, PIN - 110001 3 COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEAL CENTRE, PIN - 110001 SRI. JOSE JOSEPH, SC. THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 10.04.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C) NO. 12645 OF 2023 2 T.R. RAVI, J. -------------------------------------------- W.P.(C).No.12645 of 2023 -------------------------------------------- Dated this the 10th day of April, 2023 JUDGMENT The petitioner is a Primary Agricultural Credit Co-operative Society registered under the Kerala Co-operative Societies Act, 1969. The petitioner has been assessed for tax as per Ext.P1 order rejecting the claim for deduction

The order continues below.

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