MUPPATHADAM SERVICE CO-OPERATIVE BANK LTD. NO. E-216 vs. ASSESSMENT OFFICER/INCOME TAX OFFICER, ASSESSMENT UNIT, NATIONAL E-ASSESSMENT CENTRE

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WP(C)/41580/2022HC KeralaKLHC01090269202221 December 2022Author: HONOURABLE MR. JUSTICE GOPINATH P.3 pages
AI SummaryRemanded

What did the High Court hold?

The High Court did not decide the merits of the assessment order or the appeal. Instead, it directed the 2nd respondent (Commissioner of Income Tax (Appeals)) to consider and pass appropriate orders on the petitioner's appeal (Ext.P2) and the application for condonation of delay (Ext.P4) expeditiously, within a period of 2 months from the date of receipt of the judgment. The Court clarified that the appellate authority needs to consider the appeal on merits only if the delay in filing the appeal is condoned. Until the disposal of the appeal, no coercive steps are to be initiated against the petitioner pursuant to the assessment order (Ext.P1).

What were the facts?

The petitioner, Muppathadam Service Co-operative Bank Ltd., a Primary Agricultural Credit Society, challenged an assessment order (Ext.P1) issued by the Assessment Officer. The assessment order 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 per the Kerala Co-operative Societies Act. The petitioner had filed an appeal (Ext.P2) before the Commissioner of Income Tax (Appeals) (2nd respondent), along with an application to condone the delay (Ext.P4). This appeal and delay condonation application were pending consideration.

What were the issues?

1. Whether the assessment order rejecting the deduction under Section 80P is sustainable, considering the Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax; 2021 (1) KLT 485. Assessee's Contention: The petitioner argued that the assessment order was incorrect, relying on the Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax; 2021 (1) KLT 485, which they contended governs the field. Revenue's Contention: The judgment does not record any specific contentions made by the revenue in response to the writ petition.

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. WEDNESDAY, THE 21ST DAY OF DECEMBER 2022 / 30TH AGRAHAYANA, 1944 WP(C) NO. 41580 OF 2022 PETITIONER: MUPPATHADAM SERVICE CO-OPERATIVE BANK LTD. NO. E-216 AGED 50 YEARS MUPPATHADAM P.O, ALUVA, ERNAKULAM DISTRICT, KERALA, REPRESENTED BY ITS SECRETARY., PIN - 683110 BY ADVS. M.PAUL VARGHESE M.M.MONAYE K.V.SANOSH RESPONDENTS: 1 ASSESSMENT OFFICER/INCOME TAX OFFICER, ASSESSMENT UNIT, NATIONAL E-ASSESSMENT CENTRE INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, ROOM NO.401, 2ND FLOOR, E-RAMP, JAWAHARLAL STADIUM, DELHI, PIN - 110003 2 THE COMMISSIONER OF INCOME TAX (APPEALS), NATIONAL FACELESS APPEAL CENTRE (NFAC), INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, JAWAHARLAL STADIUM, DELHI, PIN - 110003 3 THE INCOME TAX OFFICER WARD - 2, TPS, KAP COMMERCIAL COMPLEX, O/O ADDITIONAL COMMISSIONER OF INCOME TAX, ALUVA RANGE, R.S. ROAD, ALUVA , PIN - 683101 4 PRINCIPAL COMMISSIONAR OF INCOME TAX, KERALA C.R. BUILDING, I.S. PRESS ROAD, KOCHI , PIN - 682018 OTHER PRESENT: ADV. CHRISTOPHER ABRAHAM (SC) THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 21.12.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P (C) No.41580/2022 -2-

J U D G M E N T Petitioner is a Primary Agricultural Credit Society registered under the Kerala Co- operative Societies Act, 1969. Ext.P1 order of assessment was issued against the petitioner. 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.P2 along with Ext.P4 application to condone the delay in filing the appeal and the same is pending consideration before the 2nd respondent, I deem it fit that this writ petition be disposed of directing the 2nd respondent to consider the appeal in a time bound manner.

4.

Accordingly, there will be a direction to the 2nd respondent to consider and pass appropriate orders on Ext.P2, as expeditiously as possible within a period of 2 months from the date of receipt of a copy of this judgment. .

5.

Till the disposal of the appeal, no coercive steps shall be initiated against the petitioner pursuant to Exts.P1. It is made clear that the appellate authority needs to consider the appeal on merits only if he decides to condone the delay in filing the appeal. GOPINATH P. JUDGE AMG

W.P (C) No.41580/2022 -3-

Appendix — schedule of exhibits
APPENDIX OF WP(C) 41580/2022 PETITIONER EXHIBITS Exhibit-P1 TRUE COPY OF THE ASSESSMENT ORDER DATED 23.08.2022 FOR THE AY 2020-21 ALONG WITH DEMAND NOTICE Exhibit-P2 TRUE COPY OF THE MEMORANDUM OF APPEAL IN FORM 35 DATED 11.102022 Exhibit-P3 TRUE COPY OF THE ACKNOWLEDGMENT RECEIPT OF INCOME TAX FORMS DATED 11.10.2022 Exhibit-P4 TRUE COPY OF THE PETITION TO CONDONE THE DELAY DATED 11.10.2022 Exhibit-P5 TRUE COPY OF THE PETITION FOR STAY DATED 11.10.2022

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