THE PAZHUVIL SERVICE CO-OPERATIVE BANK NO.126, vs. THE COMMISSIONER OF INCOME TAX (APPEALS),

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WP(C)/26537/2024HC KeralaKLHC01125366202425 July 2024Bench: 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 applicability of the Supreme Court judgment. Instead, the Court found that the petitioner had already preferred an appeal (Ext.P3) before the first respondent, the Commissioner of Income Tax (Appeals), which was pending consideration. 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 first respondent to consider and pass appropriate orders on Ext.P3 expeditiously. Additionally, the Court ordered that no coercive steps would be initiated against the petitioner pursuant to the demand notice (Ext.P2) until the disposal of the appeal. No issue was expressly left undecided, as the Court's action was procedural.

What were the facts?

The petitioner, Pazhuvil Service Co-operative Bank No. 126, a co-operative society, received an assessment order dated March 23, 2024. The assessing officer rejected the bank's claim for deduction under Section 80P of the Income Tax Act. The petitioner challenged this assessment order before the Commissioner of Income Tax (Appeals), the first respondent. The petitioner argued that the assessing officer failed to consider the Supreme Court's judgment in Mavilayi Service Cooperative Bank Ltd. v. Commissioner of Income Tax, 2021 (1) KLT 485, despite the assessment order being issued after this judgment. The appeal against the assessment order was pending before the first respondent.

What were the issues?

1. Whether the assessment order dated March 23, 2024, correctly applied the provisions of Section 80P of the Income Tax Act, 1961, by rejecting the petitioner's claim for deduction. Assessee's Contention: The assessing officer failed to consider the binding judgment of the Supreme Court in Mavilayi Service Cooperative Bank Ltd. v. Commissioner of Income Tax; 2021 (1) KLT 485, which was delivered prior to the assessment order. The assessee relied on this Supreme Court judgment. Revenue's Contention: The judgment does not record any specific contentions made by the revenue regarding the merits of the assessment order or the applicability of the Supreme Court judgment. The revenue's role in this proceeding was primarily 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

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. THURSDAY, THE 25TH DAY OF JULY 2024 / 3RD SRAVANA, 1946 WP(C) NO. 26537 OF 2024 PETITIONER/S: THE PAZHUVIL SERVICE CO-OPERATIVE BANK NO.126, PAZHUVIL WEST, THRISSUR , REPRESENTED BY ITS SECRETARY, PIN - 680564 BY ADV P.C.SASIDHARAN RESPONDENT/S: 1 THE COMMISSIONER OF INCOME TAX (APPEALS), NATIONAL FACELESS APPEAL CENTRE, ROOM NO. 356, C.R. BUILDING, IP ESTATE, DELHI, PIN - 110002 2 THE PRINCIPAL COMMISSIONER OF INCOME TAX, O/O. THE PRINCIPAL COMMISSIONER OF INCOME TAX, AYAKARBHAVAN, MANANCHIRA, KOZHIKODE, KERALA, PIN - 673001 3 THE INCOME TAX OFFICER, WARD IIAAYAKARBHAVAN, SAKTHANTHAMPURAN NAGAR, MUNICIPAL OFFICE ROAD, THRISSUR, KERALA, PIN - 680001 SRI. P.R. AJITHKUMAR, 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:

W.P (C) No.26537/2024 -2- J U D G M E N T Petitioner is a Co-operative Society registered under the Kerala Co-operative Societies Act, 1969. Exhibit P1 order of assessment was issued against the petitioner on 23-03-2024. In the assessment order, petitioner's claim for deduction was rejected on the ground that the income of the petitioner is not eligible for deduction under Section 80P of the Income Tax Act. 2. While assailing the assessment order before the 1st respondent, petitioner has sought to canvass that the judgment of the Supreme Court in Mavilayi Service Cooperative Bank Ltd. v. Commissioner of Income Tax; 2021 (1) KLT 485 was not considered by the assessing officer though the assessment order was rendered subsequent to the Supreme Court Judgment. 3. Since the petitioner has already preferred an appeal as Ext.P3 and the same is pending consideration before the 1st 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. 4. Accordingly, there will be a direction to the 1st respondent to consider and pass appropriate orders on Ext.P3, as expeditiously as possible. 5. Till the disposal of the appeal, no coercive steps shall be initiated against the petitioner pursuant to Ext.P2 demand notice. The writ petition is disposed of as above. Sd/- GOPINATH P. JUDGE AMG

W.P (C) No.26537/2024 -3- APPENDIX OF WP(C) 26537/2024 PETITIONER EXHIBITS Exhibit P1 THE TRUE COPY OF THE ASSESSMENT ORDER DURING THE ASSESSMENT YEAR 2022-2023DATED 23-03-2024 Exhibit P2 THE TRUE COPY OF THE DEMAND NOTICE DATED 23-03-2024 Exhibit P3 THE TRUE COPY OF THE APPEAL DATED 18/04/2024 Exhibit P4 THE TRUE COPY OF THE ACKNOWLEDGEMENT RECEIPT OF INCOME TAX FORMS SHOWING THE FILING OF THE APPEAL ON 18/04/2024 Exhibit P5 THE TRUE COPY OF THE STAY PETITION DATED 16/04/2024 FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENT Exhibit P6 THE TRUE COPY OF THE JUDGMENT IN W.A.NO.1536 OF 2019 DATED 1/7/2019 Exhibit P7 THE TRUE COPY OF THE JUDGMENT IN W.P(C) NO.14282/2021 DATED 19/7/2021 Exhibit P8 THE TRUE COPY OF THE JUDGMENT IN W.P(C) NO. 34067/2022 DATED 27/10/2022

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