ANJARAKANDY FARMERS SERVICE CO-OPERATIVE BANK LIMITED(AFSC BANK) vs. THE CENTRAL BOARD OF DIRECT TAXES ,

PDF · subscribers
WP(C)/8946/2024HC KeralaKLHC01088858202406 March 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 disposed of the writ petition by directing the 3rd respondent, the Commissioner of Income Tax (Appeals), to consider and pass appropriate orders on the petitioner's pending appeal (Ext.P2) expeditiously. The Court also granted interim relief, stating that no coercive steps would be initiated against the petitioner pursuant to the assessment order (Ext.P1) and demand notice (Ext.P3) until the disposal of the appeal. The specific findings on the deductibility under Section 80P or the interpretation of the Mavilayi Service Co-operative Bank Ltd. judgment were not addressed in this order.

What were the facts?

The petitioner, Anjarakandy Farmers Service Co-operative Bank Limited, a Primary Agricultural Credit Society, received an assessment order dated September 26, 2022. The Assessing Officer rejected the petitioner's claim for deduction under Section 80P, stating there was no evidence that the petitioner met the criteria for a Primary Agricultural Credit Society as defined by the Kerala Co-operative Societies Act. The petitioner challenged this assessment order before the Commissioner of Income Tax (Appeals), arguing that the Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax now governs the situation and renders the assessment incorrect. The appeal was pending before the appellate authority.

What were the issues?

1. Whether the assessment order dated September 26, 2022, rejecting the deduction under Section 80P of the Income Tax Act, 1961, is legally sustainable, considering the petitioner's status as a Primary Agricultural Credit Society under the Kerala Co-operative Societies Act, 1969. Assessee's Contention: The assessee argued that the Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax [2021 (1) KLT 485] governs the field and that the assessment order is incorrect based on this precedent. Revenue's Contention: The revenue, through the Assessing Officer, rejected the deduction under Section 80P on the grounds that the petitioner failed to provide evidence of satisfying 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. WEDNESDAY, THE 6TH DAY OF MARCH 2024 / 16TH PHALGUNA, 1945 WP(C) NO. 8946 OF 2024 PETITIONER/S: ANJARAKANDY FARMERS SERVICE CO-OPERATIVE BANK LIMITED (AFSC BANK) NO.1141, P.O. MAMBA, KANNUR REPRESENTED BY ITS MANAGING DIRECTOR MANOJ KUMAR P, PIN - 670611 BY ADVS. K.P.PRADEEP T.T.BIJU T.THASMI M.J.ANOOPA RESPONDENT/S: 1 THE CENTRAL BOARD OF DIRECT TAXES , REPRESENTED BY ITS CHAIRMAN,DEPARTMENT OF REVENUE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NORTH BLOCK ,NEW DELHI, PIN - 110001 2 ADDITIONAL COMMISSIONER OF INCOME TAX, ASSESSMENT UNIT, INCOME TAX DEPARTMENT, NATIONAL FACELESS ASSESSMENT CENTRE, DELHI ROOM NO. 401, 2ND FLOOR, E-RAMP, JAWAHARLAL NEHRU STADIUM, DELHI, PIN - 110003 3 COMMISSIONER OF INCOME TAX (APPEALS), NATIONAL FACELESS APPEAL CENTRE (NFAC), DELHI, ROOM NO. 401, 2ND FLOOR, E-RAMP, JAWAHARLAL NEHRU STADIUM, DELHI, PIN - 110003 SRI. CHRISTOPHER ABRAHAM , SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06.03.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C) NO. 8946 OF 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 26.09.2022. 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 3rd respondent, petitioner has sought to canvass 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 3rd 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.

WP(C) NO. 8946 OF 2024 3

4.

Accordingly, there will be a direction to the 3rd 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 and Ext.P3 demand notice. The writ petition is disposed of as above.. Sd/- GOPINATH P. JUDGE ajt

WP(C) NO. 8946 OF 2024 4 APPENDIX OF WP(C) 8946/2024 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE ASSESSMENT ORDER NO ITBA/AST/S/143(3)/2022-23/1045950898(1) DATED 26-09-2022 ISSUED FOR THE YEAR 2020-21 BY THE 2NDRESPONDENT TO THE PETITIONER Exhibit P2 TRUE COPY OF THE APPEAL DATED 21-10-2022 FILED FOR THE YEAR 2020-21 BEFORE THE 3RDRESPONDENT BY THE PETITIONER Exhibit P3 TRUE COPY OF THE DEMAND NOTICE NO. ITBA/AST/S/156/2022-23/1045950955(1)

DATED 26-09-2022 ISSUED FOR THE YEAR 2020-21 BY THE 2ND RESPONDENT TO THE PETITIONER Exhibit P4 TRUE COPY OF THE JUDGMENT DATED 23-02-2022 IN WPC NO 6109 OF 2022

More judgments on Section 80P

All 5,069 judgments and leading authorities on Section 80P →

Recent GST High Court judgments

Search GST case law →