THE MANNARKKAD RURAL SERVICE CO-OPERATIVE BANK LTD. vs. THE ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/INCOME TAX OFFICER

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WP(C)/25900/2024HC KeralaKLHC01123807202422 July 2024Bench: 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 directed the Appellate Authority (the 2nd respondent) to consider and pass appropriate orders on the petitioner's appeal (Ext.P2) expeditiously. The Court found it appropriate to dispose of the writ petition by directing the Appellate Authority to consider the pending appeal. Until the appeal is disposed of, no coercive steps are to be initiated against the petitioner pursuant to the assessment order (Ext.P1). The Court did not make any finding on the issues raised by the petitioner regarding Section 80P or the applicability of the Supreme Court judgment.

What were the facts?

The petitioner, Mannarkkad Rural Service Co-operative Bank Ltd., a Primary Agricultural Credit Society, received an assessment order dated March 19, 2024 (Ext.P1). The Assessing Officer rejected the petitioner's claim for deduction under Section 80P, stating there was no evidence that the petitioner met the criteria of a Primary Agricultural Credit Society as defined by the Kerala Co-operative Societies Act. The petitioner challenged this assessment order by filing an appeal (Ext.P2) before the Joint Commissioner (Appeals)/Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi. The petitioner argued 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.

What were the issues?

1. Whether the assessment order dated March 19, 2024, which rejected the petitioner's claim for deduction under Section 80P, is legally sustainable, considering the petitioner's status as a Primary Agricultural Credit Society under the Kerala Co-operative Societies Act. Assessee's Contentions: The petitioner contended that the Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax governs the field and renders the assessment order incorrect. Revenue's Contentions: The judgment does not record any specific contentions made by the revenue in this writ petition. The assessment order, however, rejected the deduction on the ground that the petitioner did not satisfy the ingredients of a Primary Agricultural Credit Society as contemplated under the Kerala Co-operative Societies 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 GOPINATH P. MONDAY, THE 22ND DAY OF JULY 2024 / 31ST ASHADHA, 1946 WP(C) NO. 25900 OF 2024 PETITIONER: THE MANNARKKAD RURAL SERVICE CO-OPERATIVE BANK LTD. 8/767, MANNARKAD, PALAKKAD, PIN – 678 582, REPRESENTED BY ITS SECRETARY. BY ADVS. K.KRISHNA ACHYUTH MENON RESPONDENTS: 1 THE ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/INCOME TAX OFFICER 1. NATIONAL E-ASSESSMENT CENTRE, DELHI, PIN – 110 001. 2 THE JOINT COMMISSIONER (APPEALS)/COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEAL CENTRE, DELHI, PIN – 110 001. BY ADV. P R AJITHKUMAR (SC - IT DEPT) THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 22.07.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

W.P.(C) No.25900/2024 -:2:- JUDGMENT 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 on 19.03.2024. 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 canvas 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 and the same is pending consideration before the 2nd respondent, I deem it fit that this writ petition be

W.P.(C) No.25900/2024 -:3:- disposed of directing the Appellate Authority 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. 5. Till the disposal of the appeal, no coercive steps shall be initiated against the petitioner pursuant to Ext.P1 assessment order. The writ petition is disposed of as above.

Sd/- GOPINATH P.

JUDGE ats

W.P.(C) No.25900/2024 -:4:- APPENDIX OF WP(C) 25900/2024 PETITIONER’S EXHIBITS Exhibit P1 COPY OF ASSESSMENT ORDER ISSUED BY THE 1ST RESPONDENT FOR THE YEAR 2022-23 DTD. 19-03-2024. Exhibit P2 COPY OF APPEAL FILED BY THE PETITIONER BEFORE

THE

2ND

RESPONDENT

DTD. 18-04-2024. Exhibit P3 COPY OF STAY PETITION FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DTD. 18-04-2024. Exhibit P4 COPY OF JUDGMENT IN WPC NO. 29879/23 OF THIS HON'BLE COURT DTD. 20-09-2023.

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