VEMBAYAM SERVICE CO-OPERATIVE BANK LTD.NO.3121 vs. THE INCOME TAX OFFICER

WP(C)/13746/2019HC KeralaKLHC01034031201914 May 2019Author: HONOURABLE MR. JUSTICE RAJA VIJAYARAGHAVAN V3 pages

AI SummaryRemanded

What did the High Court hold?

The High Court directed the 2nd respondent (Commissioner of Income Tax (Appeals)) to pass orders on the stay petition (Exhibit-P8) expeditiously, within a period of two months from the production of a copy of the judgment. The Court further ordered that, until such time as the stay petition is decided, recovery proceedings pursuant to the impugned order in the appeal shall be kept in abeyance. The principle underlying this decision is that recovery should be deferred pending a decision on a stay application, to prevent prejudice to the assessee if the appeal were to succeed. No specific issue was left undecided, as the Court provided a clear direction for the disposal of the stay petition.

What were the facts?

The petitioner, Vembayam Service Co-operative Bank Ltd., filed a writ petition challenging an order (Exhibit-P4). The petitioner had preferred an appeal against this order, along with an application for stay of proceedings (Exhibits-P7 and P8). The petitioner's grievance was that recovery proceedings were being initiated without considering the merits of their challenge. The High Court heard the submissions of both parties.

What were the issues?

1. Whether recovery proceedings can be initiated without considering the merits of the challenge raised by the assessee? (Mixed question of law and fact, concerning principles of natural justice and procedural fairness). Assessee's Contention: The petitioner argued that recovery proceedings were being initiated prematurely, without a proper consideration of the appeal and stay petition filed against the impugned order. They contended that their challenge to the order had not been addressed. Revenue's Contention: The judgment records no specific argument from the revenue regarding the initiation of recovery proceedings or the consideration of the assessee's challenge.

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 RAJA VIJAYARAGHAVAN V TUESDAY, THE 14TH DAY OF MAY 2019 / 24TH VAISAKHA, 1941 WP(C).No. 13746 of 2019 PETITIONER: VEMBAYAM SERVICE CO-OPERATIVE BANK LTD.NO.3121 REPRESENTED BY ITS SECRETARY IN CHARGE, KONCHIRA P.O, THIRUVANANTHAPURAM - 695 615. BY ADVS. SRI.T.R.HARIKUMAR SRI.ARJUN RAGHAVAN RESPONDENTS: 1 THE INCOME TAX OFFICER, WARD-2(3), OFFICE OF THE JOINT COMMISSIONER OF INCOME TAX, RANGE-2, 1ST FLOOR, AYAKAR BHAVAN, KOWDIAR, THIRUVANANTHAPURAM - 695 003. 2 THE COMMISSIONER OF INCOME TAX (APPEALS), AAYAKAR BHAVAN, KOWDIAR, THIRUVANANTHAPURAM - 695 003. SRI. CHRISTOPHER ABRAHAM SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 14.05.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP©:13746 OF 2019 2

JUDGMENT Challenging Exhibit-P4 order, the petitioner herein has preferred an appeal along with an application for stay of proceedings as is evident from Exhibits-P7 and P8. The grievance of the petitioner is that recovery proceedings are being initiated without considering the merits of the challenge that they had raised.

Heard the learned counsel appearing for the petitioner and the learned Government Pleader.

Having considered the facts and circumstances and the submissions made across the bar, there shall be a direction to the 2nd respondent to pass orders on Exhibit-P8 stay petition, expeditiously, at any rate, within a period of two months from the production of a copy of this judgment. Till such time, recovery proceedings pursuant to the impugned order in the appeal shall be kept in abeyance. The Writ Petition is disposed of as above. RAJA VIJAYARAGHAVAN V., JUDGE yd

WP©:13746 OF 2019 3 APPENDIX PETITIONER'S EXHIBITS: EXHIBIT P1 AOF THE CERTIFICATE DATED 20.11.2017, ISSUED BY THE ASSISTANT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL), NEDUMANGADU. EXHIBIT P2 AOF THE ORDER DATED 27.11.2017 ISSUED BY THE 2ND RESPONDENT ON THE STAY PETITION IN ITA No.373/EF/TVM/CIT(A)/TVM/2016-17. EXHIBIT P3 AOF THE ORDER PASSED BY THE 2ND RESPONDENT DATED 18.12.2018 IN ITA No.373/EF/TVM/CIT(A)/TVM/2016-17. EXHIBIT P4 AOF THE PROCEEDINGS OF THE 1ST RESPONDENT ALONG WITH REVISED ORDER ISSUED BY THE 1ST RESPONDENT DATED 18.01.2019. EXHIBIT P5 AOF THE PROCEEDINGS OF THE 1ST RESPONDENT ALONG WITH REVISED ORDER ISSUED BY THE 1ST RESPONDENT DATED 21.01.2019. EXHIBIT P6 AOF THE NOTICE DATED 25.04.2019 ISSUED BY THE 1ST RESPONDENT. EXHIBIT P7 AOF THE ONLINE APPEAL DATED 06.05.2019 FILED AGAINST EXT.P4 ORDER BEFORE THE 2ND RESPONDENT, WITH DELAY CONDONATION. EXHIBIT P8 AOF THE STAY PETITION DATED 03.05.2019 FILED BEFORE THE 2ND RESPONDENT. EXHIBIT P9 AOF THE JUDGMENT DATED 21.02.2019 IN W.P.(C)NO.5070 OF 2019. RESPONDENTS' EXHIBITS:NILP.A. TO JUDGE

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