MUNDELA SERVICE CO-OPERATIVE BANK LTD. NO. 2433 vs. THE CENTRAL BOARD OF DIRECT TAXES

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WP(C)/3117/2020HC KeralaKLHC01008728202025 January 2022Bench: HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court held that since various factual disputes were raised, the petitioner's appropriate remedy was to pursue its statutory remedy of appeal. However, acknowledging the long pendency of the writ petition, the court directed that the period from February 4, 2020, until the date of the judgment should be excluded while calculating the period of limitation for preferring an appeal against the assessment order. Furthermore, as recovery proceedings had been initiated, the court ordered that these proceedings be kept in abeyance for 30 days to enable the petitioner to file the appeal. The writ petition was disposed of with these directions.

What were the facts?

The petitioner, Mundela Service Co-operative Bank Ltd., filed a writ petition (civil) on February 4, 2020, challenging an order of assessment (Ext.P7) issued under Section 147 of the Income Tax Act for the assessment year 2012-13. The respondents are the Central Board of Direct Taxes, the Principal Chief Commissioner of Income Tax, Kerala, and the Income Tax Officer, Ward 2(3). The petitioner invoked the writ jurisdiction of the High Court of Kerala, despite having a statutory appellate remedy available. The writ petition was pending before the court from its filing date.

What were the issues?

1. Whether the High Court should entertain a writ petition when a statutory remedy of appeal is available to the petitioner against the order of assessment? The assessee (petitioner) sought to invoke the writ jurisdiction under Article 226 of the Constitution of India, bypassing the statutory appeal mechanism. The revenue (respondents) did not explicitly argue against the maintainability of the writ petition in the provided text, but the court's decision implies that the statutory remedy should have been pursued. 2. Whether the period spent by the petitioner in pursuing the writ petition should be excluded for the purpose of calculating the period of limitation for filing a statutory appeal? The assessee contended that they should not be prejudiced by the time spent pursuing the writ petition. The revenue's stance on this issue is not recorded.

Which sections of the Income-tax Act were involved?

Section 147

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS TUESDAY, THE 25TH DAY OF JANUARY 2022 / 5TH MAGHA, 1943 WP(C) NO. 3117 OF 2020 PETITIONER: MUNDELA SERVICE CO-OPERATIVE BANK LTD., NO. 2433 MUNDELA P. O., VELLANADU, THIRUVANANTHAPURAM - 695543, REPRESENTED BY ITS SECRETARY RAHUL P. S. BY ADVS. K.P.PRADEEP SRI.T.T.BIJU SMT.T.THASMI RESPONDENTS: 1 THE CENTRAL BOARD OF DIRECT TAXES DEPARTMENT OF REVENUE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NORTH BLOCK, NEW DELHI - 110001, REPRESENTED BY ITS CHAIRMAN. 2 PRINCIPAL CHIEF COMMISSIONR OF INCOME TAX KERALA, CENTRAL REVENUE BUILDINGS, I.S.PRESS ROAD, KOCHI - 682018. 3 INCOME TAX OFFICER WARD 2(3), AAYAKKAR BHAVAN, INCOME TAX, KOWADIAR, THIRUVANANTHAPURAM - 695 003. BY ADV.CHRISTOPHER ABRAHAM – SC, R1-R3 THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 25.01.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C) NO. 3117 OF 2020 2 BECHU KURIAN THOMAS, J. ----------------------------------------- W.P.(C) No. 3117 of 2020 ---------------------------------------- Dated this the 25th day of January, 2022 JUDGMENT Ext.P7 is an order of assessment issued under Section 147 of the Income Tax Act for the assessment year 2012-13. Though an appeal is available to the petitioner, they sought to invoke the writ jurisdiction under Article 226 by filing this writ petition on 04.02.2020. 2. Since various factual disputes are raised for consideration, this Court is of the opinion that the remedy of the petitioner is to pursue its statutory remedy of appeal. However, since this writ petition has been pending from the date earlier mentioned, the petitioner will be put to prejudice due to the long lapse of time. As the pendency of this writ petition before this Court, ought not to cause prejudice to the petitioner, it is necessary that, while relegating the petitioner to the appellate remedy, the period spent by the petitioner in pursuing this writ petition be excluded while calculating the period of limitation for preferring an appeal against Ext.P7. 3. I therefore direct exclusion of the period from

WP(C) NO. 3117 OF 2020 3 04.02.2020 till date of this judgment and relegate the petitioner to prefer the statutory appeal against Ext.P7. Since recovery proceedings have been initiated in the meantime, the same shall be kept in abeyance for a period of 30 days to enable the petitioner to prefer an appeal. With the aforesaid observations, this writ petition is disposed of.

Sd/- BECHU KURIAN THOMAS JUDGE DM

WP(C) NO. 3117 OF 2020 4 APPENDIX OF WP(C) 3117/2020 PETITIONER EXHIBITS EXHIBIT P1 TRUE COPY OF THE RETURN OF INCOME WITH STATEMENT DATED 29.12.2012 FILED BY THE PETITIONER FOR 2012-13. EXHIBIT P2 TRUE COPY OF THE NOTICE NO. ITBA/AST/S/148/2018-19/1015544694(1) DATED 30.3.2019 ISSUED BY THE 3RD RESPONDENT. EXHIBIT P3 TRUE COPY OF THE NOTICE NO. ITBA/AST/F/17/2019-20/1015943234(1) DATED 9.5.2019 ISSUED BY THE 3RD RESPONDENT. EXHIBIT P4 TRUE COPY OF THE REPLY TO EXT.P3 NOTICE. EXHIBIT P5 TRUE

COPY

THE

NOTICE NO.ITBA/AST/F/142(1)/2019- 20/1018799599(1)

DATED

11.10.2019 ISSUED BY THE 3RD RESPONDENT. EXHIBIT P6 TRUE COPY OF THE REPLY DATED 28.10.2019 SUBMITTED BY THE PETITIONER. EXHIBIT P7 TRUE COPY OF THE ASSESSMENT ORDER NO.AAAAM5586E/2012-13 DATED 19.12.2019. EXHIBIT P8 TRUE COPY OF THE DEMAND NOTICE NO.AAAAM5586E/2012-13 DATED 19.12.2019. EXHIBIT P9 TRUE

COPY

THE

NOTICE NO.ITBA/RCV/F/17/2021-22/1038516794(1) DATED 7.1.2022 ISSUED BY THE INCOME TAX OFFICER, WARD 2(1), THIRUVANANTHAPURAM. RESPONDENTS EXHIBITS : NIL //TRUE COPY// PA TO JUDGE

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