KARTHEDOM RURAL CO-OPERATIVE SOCIETY LTD. NO. 385 vs. INCOME TAX OFFICER

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WP(C)/42531/2022HC KeralaKLHC01092187202223 December 2022Author: HONOURABLE MR. JUSTICE GOPINATH P.4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala did not decide the merits of the case. Instead, it acknowledged that the petitioner had already preferred an appeal (Ext.P4) before the 2nd respondent (Commissioner of Income Tax (Appeals)) and that this appeal was pending. Therefore, the Court deemed it appropriate to dispose of the writ petition by directing the Appellate Authority to consider the pending appeal in a time-bound manner. The Court directed the 2nd respondent to consider and pass appropriate orders on Ext.P4 expeditiously. Furthermore, the Court ordered that no coercive steps shall be initiated against the petitioner pursuant to the assessment order (Ext.P2) and demand notice (Ext.P3) until the disposal of the appeal. No specific finding was made on the issues raised, as the appeal was to be decided by the appellate authority.

What were the facts?

The petitioner, Karthedom Rural Co-operative Society Ltd. No. 385, is a Primary Agricultural Credit Society registered under the Kerala Co-operative Societies Act, 1969. The Income Tax Officer (ITO) issued an assessment order (Ext.P2) dated 30.03.2022 for the assessment year 2013-14. The ITO rejected the petitioner's claim for deduction under Section 80P, stating there was no evidence that the petitioner satisfied the ingredients of a Primary Agricultural Credit Society as defined by the Kerala Co-operative Societies Act. The petitioner appealed this order before the Commissioner of Income Tax (Appeals) (NFAC), the 2nd respondent, arguing that the Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax governs the situation and renders the assessment incorrect. The appeal (Ext.P4) was pending before the 2nd respondent.

What were the issues?

1. Whether the assessment order dated 30.03.2022, which rejected the petitioner's claim for deduction under Section 80P for assessment year 2013-14 on the ground of insufficient evidence regarding its status as a Primary Agricultural Credit Society, is legally sustainable. Assessee's Contentions: - The petitioner contends that the Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax [2021 (1) KLT 485] governs the field and that this judgment renders the assessment order incorrect. Revenue's Contentions: - The judgment does not record any specific contentions made by the revenue in response to the writ petition. The assessment order itself stated that there was no evidence to show the petitioner satisfied the ingredients of a Primary Agricultural Credit Society.

Which sections of the Income-tax Act were involved?

Section 80P

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. FRIDAY, THE 23RD DAY OF DECEMBER 2022 / 2ND POUSHA, 1944 WP(C) NO. 42531 OF 2022 PETITIONER/S: KARTHEDOM RURAL CO-OPERATIVE SOCIETY LTD. NO. 385 KARTHEDOM, MALIPURAM, KOCHI, ERNAKULAM REPRESENTED BY ITS SECRETARY, PIN - 682511 BY ADV M.SASINDRAN RESPONDENT/S: 1 INCOME TAX OFFICER NON CORP WARD 2(4) AND TPS KOCHI CENTRAL REVENUE BUILDING I S PRESS ROADKACHERIPADY KOCHI, PIN - 682018 2 THE COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEALS CENTRE (NFAC) NEW DELHI, PIN - 110001 BY ADV JOSE JOSEPH THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 23.12.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 42531 OF 2022 2

JUDGMENT Petitioner is a Primary Agricultural Credit Society registered under the Kerala Co-operative Societies Act, 1969. Ext.P2 order of assessment was issued against the petitioner on 30.03.2022, for the assessment yer 2013-14. In the assessment order, petitioner's claim for deduction under Section 80P was rejected on the ground that there was no evidence to show that petitioner satisfied the ingredients of the Primary Agricultural Credit Society as contemplated under the Kerala Co-operative Societies Act.

2.

While assailing the assessment order before the 2nd respondent, petitioner has sought to canvass that the judgment of the Supreme Court in Mavilayi Service Co- operative Bank Ltd. v. Commissioner of Income Tax [2021 (1) KLT 485] now governs the field thereby rendering the assessment itself as incorrect.

3.

Since the petitioner has already preferred an appeal as Ext.P4 and the same is pending consideration before the 2nd respondent, I deem it fit that this writ petition be disposed of directing the Appellate Authority to consider the appeal in a time bound manner.

WP(C) NO. 42531 OF 2022 3

4.

Accordingly, there will be a direction to the 2nd respondent to consider and pass appropriate orders on Ext.P4, as expeditiously as possible.

5.

Till the disposal of the appeal, no coercive steps shall be initiated against the petitioner pursuant to Ext.P2 assessment order and Ext.P3 demand notice.

The writ petition is disposed of as above. GOPINATH P. JUDGE ajt

WP(C) NO. 42531 OF 2022 4

Appendix — schedule of exhibits
APPENDIX OF WP(C) 42531/2022 PETITIONER EXHIBITS Exhibit1 A TRUE COPY OF THE CERTIFICATE OF REGISTRATION DATED 21.12.2015 ISSUED BY THE DEPUTY REGISTRAR OF CO-OPERATIVE SOCIETIES, ERNAKULAM Exhibit P2 A TRUE COPY OF THE ASSESSMENT ORDER FOR THE YEAR 2013-2014 DATED 30.03.2022 Exhibit P3 A TRUE COPY OF THE DEMAND NOTICE NO.ITBA/AST/S/156/2021-22/1042163863(1) DATED 30.03.2022 Exhibit P4 A TRUE COPY OF THE APPEAL MEMORANDUM FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DATED 06.07.2022 Exhibit P4(a) A TRUE COPY OF THE STAY PETITION FILED BEFORE THE 1ST RESPONDENT DATED 18.06.2022 Exhibit P5 A TRUE COPY OF THE JUDGMENT DATED 19.07.2019 IN W.A.NO.1639/2019 Exhibit P6 A TRUE COPY OF THE NOTICE NO.ITBA/COM/F/17/2022-23/1048013093(1)DATED 15.12.2022

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