KERALA CO-OPERATIVE DEPOSIT GUARANTEE FUND BOARD, vs. COMMISSIONER OF INCOME TAX (EXEMPTION)

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WP(C)/41845/2023HC KeralaKLHC01093648202329 January 2024Bench: HONOURABLE MR. JUSTICE D. K. SINGH5 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala disposed of the writ petition with a specific direction. The Court acknowledged the submissions made by the learned Standing Counsel for the Income Tax Department, who stated that the CBDT had commenced the process of deciding the petitioner's application and that a decision would be taken expeditiously. Therefore, the Court directed the second respondent (The Chairman, Central Board of Direct Taxes) to take a decision on the petitioner's application (Ext.P5) as expeditiously as possible, preferably within a period of four months from the date of the order. The Court did not delve into the merits of the exemption claim itself but focused on ensuring a timely decision by the authorities. No specific issue was left undecided, as the court's action was procedural.

What were the facts?

The petitioner, Kerala Co-operative Deposit Guarantee Fund Board, a statutory body established under the Kerala Co-operative Societies Act, 1969, sought exemption from income tax under Section 10(46A) of the Income Tax Act, 1961. The petitioner filed an application for this exemption (Ext.P5) on June 26, 2018, with the respondent authorities. However, no decision had been taken on this application despite the significant delay. Consequently, the petitioner approached the High Court of Kerala by way of a writ petition, seeking appropriate relief due to the lack of action on their exemption application.

What were the issues?

1. Whether the petitioner, Kerala Co-operative Deposit Guarantee Fund Board, is entitled to exemption from payment of income tax under Section 10(46A) of the Income Tax Act, 1961, due to its status as a statutory body. Assessee's Contention: The petitioner argued that as a statutory body, it is eligible for exemption under Section 10(46A) of the Income Tax Act, 1961. They highlighted that their application for exemption, filed on June 26, 2018, had not been decided by the authorities, leading to a prolonged delay. Revenue's Contention: The Income Tax Department, through its Standing Counsel, submitted that the Central Board of Direct Taxes (CBDT) had initiated the process to decide on the petitioner's application. A report had been called for from the jurisdictional Commissioner, and an appropriate decision, in accordance with the law, would be taken shortly.

Which sections of the Income-tax Act were involved?

Section 10(46A),Section 57B

AI-generated summary — verify with the full judgment below

Heard together (2 matters)

WP(C) NO. 41845 OF 2023
TC 82/54

Read from the judgment's own cause title. This page is filed under one of them.

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH MONDAY, THE 29TH DAY OF JANUARY 2024 / 9TH MAGHA, 1945 WP(C) NO. 41845 OF 2023 PETITIONER: KERALA CO-OPERATIVE DEPOSIT GUARANTEE FUND BOARD, TC 82/5422(1), AMBUJAVILASAM ROAD, G.P.O JUNCTION, PULIMOODE, THIRUVANANTHAPURAM P.O, THIRUVANANTHAPURAM (D), KERALA, 695001. REPRESENTED BY ITS SECRETARY BY ADV C.A.JOJO RESPONDENTS: 1 COMMISSIONER OF INCOME TAX (EXEMPTION) OFFICE OF THE COMMISSIONER OF INCOME TAX, I S PRESS ROAD, KOCHI, PIN – 682018 2 THE CHAIRMAN, CENTRAL BOARD OF DIRECT TAXES (ITA-1 DIVISION), MINISTRY OF FINANCE, DEPARTMENT OF REVENUE, ROOM NO.245 A, NORTH BLOCK, NEW DELHI, PIN – 110001 3 THE INCOME TAX OFFICER, NATIONAL FACELESS ASSESSMENT CENTRE, NEW DELHI- NORTH BLOCK, NEW DELHI, PIN – 110001 4 THE REGISTRAR OF CO-OPERATIVE SOCIETIES, JAWAHAR SAHAKARANA BHAVAN, D.P.I JUNCTION , THYCAUD P.O, THIRUVANATHAPURAM, PIN – 695014 BY ADV. JOSE JOSEPH-SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 29.01.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C) NO. 41845 OF 2023 -2- JUDGMENT The petitioner is Kerala Co-operative Deposit Guarantee Fund Board constituted as per the provisions of SRO No.28 of 2012 issued under Section 57B of the Kerala Co-operative Societies Act, 1969. 2. Learned counsel for the petitioner submits that the petitioner is a statutory body and as per Section 10(46A) of the Income Tax Act, 1961, the petitioner is entitled for exemption from payment of the income tax on its income. Petitioner had applied for granting exemption from payment of income tax in Ext.P5. The said application is dated 26.06.2018, but the authority had not taken any decision on the said application of the petitioner. There has been long delay in taking decision on the application of the petitioner, the petitioner has no other remedy. Therefore, the petitioner has approached this Court for appropriate relief. 3. Mr.Jose Joseph, learned Standing Counsel for

WP(C) NO. 41845 OF 2023 -3- the Income Tax Department submitted that the CBDT has initiated the process of taking decision on the said application of the petitioner in Ext.P5. A report has been called for from the jurisdictional Commissioner. He further submits that the appropriate decision, in accordance with law, on the application of the petitioner in Ext.P5 shall be taken within short time. 4. Considering the aforesaid submission and stand of the learned Standing Counsel for the Income Tax Department, the present Writ petition is disposed off with direction to the second respondent to take decision as expeditiously as possible on application of the petitioner in Ext.P5 preferably within a period of four months. With the aforesaid direction, this writ petition stands disposed off. Sd/- DINESH KUMAR SINGH vv JUDGE

WP(C) NO. 41845 OF 2023 -4- APPENDIX OF WP(C) 41845/2023 PETITIONER EXHIBITS EXHIBIT P1 A TRUE COPY OF THE NOTIFICATION OF THE SCHEME PASSED BY THE GOVT. OF KERALA G.O (P) 03/2012/CO-OP DATED 11.01.2012 EXHIBIT P2 A TRUE COPY OF THE NOTIFICATION OF THE SCHEME PASSED BY THE GOVT. OF KERALA G.O (P) 71/2019/CO-OP DATED 22.06.2019 EXHIBIT P3 A TRUE COPY OF THE NOTIFICATION FOR ENHANCING THE DEPOSIT GUARANTEE PASSED BY THE GOVT. OF KERALA G.O (P) 161/2023/CO-OP DATED 06.07.2023 EXHIBIT P4 A TRUE COPY OF THE PRESCRIBED FORM FOR EXEMPTION ISSUED BY CBDT F.NO.196/6/2013-ITA 1 DATED 27.06.2013 EXHIBIT P5 A TRUE COPY OF THE APPLICATION FOR EXEMPTION ALONG WITH A COVERING LETTER SUBMITTED BEFORE THE 1ST RESPONDENT DATED 29.06.2018 EXHIBIT P6 A TRUE COPY OF THE LETTER ISSUED BY THE UNDER SECRETARY TO GOVERNMENT OF INDIA DATED 28.08.2018 EXHIBIT P7 A TRUE COPY OF THE LETTER SUBMITTED TO UNDER SECRETARY OF THE 2ND RESPONDENT DATED 03.10.2018 EXHIBIT P8 A TRUE COPY OF THE LETTER ISSUED BY THE 3RD RESPONDENT DATED 12.11.2018 EXHIBIT P9 A TRUE COPY OF THE DETAILED REPLY SUBMITTED BEFORE THE 3RD RESPONDENT DATED 16.11.2018

WP(C) NO. 41845 OF 2023 -5- EXHIBIT P10 A TRUE COPY OF THE LETTER SUBMITTED TO THE 1ST RESPONDENT DATED 11.01.2023 EXHIBIT P11 A TRUE COPY OF THE REMINDER LETTER SUBMITTED TO THE 2ND RESPONDENT DATED 09.06.2023 EXHIBIT P12 A TRUE COPY OF THE REMINDER LETTER SUBMITTED TO THE 2ND RESPONDENT DATED 02.09.2023

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