THE AYYANTHOLE PANCHAYAT SERVICE CO-OPERATIVE BANK LTD NO.471 vs. 1 THE COMMISSIONER OF INCOME TAX (APPEALS)

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WP(C)/36401/2022HC KeralaKLHC01078147202215 November 2022Author: 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 appeal. Instead, it observed 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 shall be initiated against the petitioner pursuant to the assessment order (Ext.P1) until the disposal of the appeal. No specific issue was left undecided, as the Court's action was procedural.

What were the facts?

The petitioner, The Ayyanthole Panchayat Service Co-operative Bank Ltd., is a Primary Agricultural Credit Society registered under the Kerala Co-operative Societies Act, 1969. The Income Tax Officer (ITO) issued an assessment order on September 28, 2022, rejecting the petitioner's claim for deduction under Section 80P. The ITO's reasoning was that the petitioner failed to provide evidence demonstrating it satisfied 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 before the Commissioner of Income Tax (Appeals), the first respondent.

What were the issues?

1. Whether the assessment order dated 28.09.2022, 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, 1969? The petitioner contended that the Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd. and others v. Commissioner of Income Tax and another [2021 (1) KLT 485] governs the present case, rendering the assessment order incorrect. The revenue's contentions are not recorded in the judgment.

Which sections of the Income-tax Act were involved?

Section 80P

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. TUESDAY, THE 15TH DAY OF NOVEMBER 2022 / 24TH KARTHIKA, 1944 WP(C) NO. 36401 OF 2022 PETITIONER: THE AYYANTHOLE PANCHAYAT SERVICE CO-OPERATIVE BANK LTD NO.471, AYYANTHOLE, KARIATTUKARA, ELTHURUTH.P.O, THRISSUR – 680 611, REPRESENTED BY ITS SECRETARY. BY ADV P.C.SASIDHARAN RESPONDENTS: 1 THE COMMISSIONER OF INCOME TAX (APPEALS), NATIONAL FACELESS APPEAL CENTRE, ROOM NO.356, C.R. BUILDING, IP ESTATE, DELHI – 110 002. 2 THE PRINCIPAL COMMISSIONER OF INCOME TAX, O/O THE PRINCIPAL COMMISSIONER OF INCOME TAX, AYAKAR BHAVAN, MANANCHIRA, KOZHIKODE, KERALA – 673 001. 3 THE INCOME TAX OFFICER, WARD 2(5), THRISUR, OFFICE OF THE INCOME TAX OFFICER, SHAKTHANTHAMPURAN NAGAR, THRISSUR – 680 001. BY ADV JOSE JOSEPH THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 15.11.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 36401 OF 2022 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 28.09.2022. 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 1st respondent, petitioner has sought to canvas that the judgment of the Supreme Court in Mavilayi Service Co- operative Bank Ltd. and others v. Commissioner of Income Tax and another [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.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.

WP(C) NO. 36401 OF 2022 3

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.P1 assessment order. The writ petition is disposed of as above. GOPINATH P. JUDGE DK

WP(C) NO. 36401 OF 2022 4

Appendix — schedule of exhibits
APPENDIX OF WP(C) 36401/2022 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE ASSESSMENT ORDER ALONG WITH THE COMPUTATION SHEET DATED 28/09/2022 Exhibit P2 TRUE COPY OF THE DEMAND NOTICE DATED 28/09/2022 Exhibit P3 TRUE COPY OF THE APPEAL DATED 28/10/2022 Exhibit P4 TRUE COPY OF THE STAY PETITION Exhibit P5 TRUE COPY OF THE JUDGMENT IN W.A.NO.1536 OF 2019 DATED 1/7/2019 Exhibit P6 TRUE COPY OF THE JUDGMENT IN W.P(C) NO.14282/2021 DATED 19/7/2021 Exhibit P7 EXHIBIT P7:- TRUE COPY OF THE JUDGMENT DATED 27.10.2022 IN WPC NO. 34067/2022

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