THIRUMALA SERVICE CO-OPERATIVE SOCIETY LTD NO T 1444 vs. 1. THE CENTRAL BOARD OF DIRECT TAXES

WP(C)/37358/2022HC KeralaKLHC01080428202225 July 2024Author: HONOURABLE MR. JUSTICE GOPINATH P.4 pages
AI SummaryRemanded

What were the facts?

The petitioner, Thirumala Service Co-operative Society Ltd, is a co-operative society. For the assessment year 2012-2013, it failed to file a return of income. Consequently, its assessment was completed under Section 144 of the Income Tax Act, 1961, to the best of the assessing officer's judgment, utilizing data from the co-operative department. The petitioner sought to claim a deduction under Section 80P of the Act. The Income Tax Department contended that due to the non-filing of the return, the deduction under Section 80P was not admissible as per Section 80A(5) of the Act. However, it was acknowledged that the petitioner had current year losses that could potentially be set off against income from other sources.

What did the High Court hold?

The High Court disposed of the writ petition by setting aside Ext.P5 order. While acknowledging the Revenue's contention that the petitioner was not entitled to claim deduction under Section 80P due to non-filing of the return, as per Section 80A(5) of the Income Tax Act, 1961, the Court also noted the submission that the petitioner had current year losses that could be set off against income from other sources. Therefore, the Court directed the Income Tax Officer (2nd respondent) to pass fresh orders on the petitioner's rectification application, which included a prayer for setting off current year losses. The petitioner was to be afforded an opportunity of hearing. The 2nd respondent was directed to pass these orders within two months. Coercive steps for recovery of any amount due under the assessment order for 2012-2013 were suspended until the fresh decision.

What were the issues?

1. Whether the petitioner, having failed to file a return of income for the assessment year 2012-2013, is entitled to claim deduction under Section 80P of the Income Tax Act, 1961, in light of Section 80A(5) of the Act? Assessee's Contention: The petitioner, a co-operative society, submitted that it is entitled to deduction under Section 80P of the 1961 Act. Revenue's Contention: The Income Tax Department argued that in light of Section 80A(5) of the 1961 Act, the petitioner is not entitled to claim such deduction as it has not filed any return of income. However, the department acknowledged that there were current year losses that could have been set off against income from other sources.

Which sections of the Income-tax Act were involved?

Section 80P,Section 80A(5),Section 144

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. THUR AY, THE 25TH DAY OF JULY 2024 / 3RD SRAVANA, 1946 WP(C) NO. 37358 OF 2022 PETITIONER: THIRUMALA SERVICE CO-OPERATIVE SOCIETY LTD NO T 1444 THIRUMALA POST, THIRUVANANTHAPURAM, PIN – 695 006. REPRESENTED BY ITS SECRETARY RENJINI N.S. BY ADVS. K.P.PRADEEP HAREESH M.R. SANAND RAMAKRISHNAN T.T.BIJU T.THASMI M.J.ANOOPA SANU S MALAKEEL RESPONDENTS: 1 THE CENTRAL BOARD OF DIRECT TAXES DEPARTMENT OF REVENUE, MINISTRY OF FINANCE GOVERNMENT OF INDIA, NORTH BLOCK, NEW DELHI, PIN – 110 001, REPRESENTED BY ITS CHAIRMAN. 2 INCOME TAX OFFICER, WARD 2(1), AAYAKKAR BHAVAN, INCOME TAX DEPARTMENT, KOWADIAR, THIRUVANANTHAPURAM, PIN – 695 003. BY ADVS. CHRISTOPHER ABRAHAM (SC-INCOME TAX DEPARTMENT) THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 25.07.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C) NO. 37358 OF 2022 2 JUDGMENT The petitioner is a co-operative society. For the year 2012-2013, the petitioner did not file any return of income under the provisions of the Income Tax Act, 1961 (hereinafter referred to as the ‘1961 Act’) and resultantly the assessment of the peti

The order continues below.

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