THARUVANA SERVICE COOPERATIVE BANK LTD vs. 1. INCOME TAX OFFICER

WP(C)/29814/2022HC KeralaKLHC01063353202207 October 2022Author: HONOURABLE MR. JUSTICE GOPINATH P.4 pages

AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala disposed of the writ petition by directing the National Faceless Appeal Centre (NFAC) to consider and pass orders on the appeals (Exts.P3 and P4) filed by the petitioner against the penalty orders (Exts.P1 and P2). The NFAC was directed to afford an opportunity of hearing to the petitioner and pass orders in accordance with law within three months from the date of receipt of a certified copy of the judgment. Crucially, the Court ordered that any proceedings for recovery of amounts under Exts.P1 and P2 shall remain suspended until orders are passed on Exts.P3 and P4. The Court did not decide on the merits of the penalty orders themselves, but rather on the procedural aspect of ensuring timely disposal of the appeals and providing interim relief from recovery.

What were the facts?

The petitioner, Tharuvana Service Cooperative Bank Ltd., is aggrieved by penalty orders (Exts.P1 and P2) and has filed appeals (Exts.P3 and P4) before the National Faceless Appeal Centre (NFAC). The petitioner apprehends recovery proceedings for the penalty amounts while the appeals are pending. The respondent-Department noted that the petitioner had obtained a conditional order of stay from the Principal Commissioner of Income Tax, which was not complied with. The Department agreed that the appeals could be directed to be disposed of.

What were the issues?

1. Whether the National Faceless Appeal Centre should be directed to dispose of the pending appeals filed by the petitioner against penalty orders, and if so, within what timeframe? Assessee's contention: The petitioner sought a direction for the disposal of their appeals against penalty orders and for a stay of recovery proceedings pending the disposal of these appeals. Revenue's contention: The revenue pointed out that a conditional order of stay obtained by the petitioner from the Principal Commissioner of Income Tax had not been complied with. However, the revenue agreed that the appeals could be directed to be disposed of.

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. FRIDAY, THE 7TH DAY OF OCTOBER 2022 / 15TH ASWINA, 1944 WP(C) NO. 29814 OF 2022 PETITIONER/S: THARUVANA SERVICE COOPERATIVE BANK LTD AGED 42 YEARS THARUVANA P.O., WAYANAD DISTRICT-670732 REPRESENTED BY ITS SECRETARY., PIN - 670732 BY ADV G.KEERTHIVAS RESPONDENT/S: 1 INCOME TAX OFFICER AYAKAR BHAVAN, KALPETTA-, PIN - 673122 2 JOINT COMMISSIONER OF INCOME TAX, OFFICE OF THE INCOME TAX DEPARTMENT, RANGE-II, KOZHIKODE-, PIN - 673001 3 THE COMMISSIONER OF INCOME TAX (APPEALS), AYAKAR BHAVAN, KOZHIKODE DISTRICT-, PIN - 673001 4 PRINCIPAL COMMISSIONER OF INCOME TAX AYAKAR BHAVAN, KOZHIKODE , PIN - 673001 5 NATIONAL FACELESS APPEAL CENTRE C BLOCK, SPM CIVIC CENTRE, NEW DELHI - 110001, REPRESENTED BY PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX (NFAC), PIN - 110001 BY ADV JOSE JOSEPH, SC, INCOME TAX DEPARTMENT, KERALA THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 07.10.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 29814 OF 2022 2

JUDGMENT

Aggrieved by Exts.P1 and P2 orders imposing penalty, petitioner has preferred Exts.P3 and P4 appeals before the National Faceless Appeal Centre. Petitioner now apprehends that steps will be taken against him to recover the amounts imposed in tersm of Exts.P1 and P2, pending disposal of Exts.P3 and P4 appeals by the National Faceless Appeal Centre.

Learned Standing Counsel appearing for the respondent-Department pointed out that the petitioner had obtained a conditional order of stay from the Principal Commissioner of Income Tax, which has not been complied with. However, it is submitted that the appeals can be directed to be disposed of.

Having heard the learned counsel appearing for the petitioner and the learned Standing Counsel appearing for the respondent-Department, the writ petition is disposed of, directing the National Faceless Appeal Centre to consider and pass orders on Exts.P3 and P4 appeals filed against Exts.P1 and P2 orders imposing penalty, after affording an opportunity of hearing to the petitioner, and in accordance with law, within a period of three months from the date of receipt of a certified

WP(C) NO. 29814 OF 2022 3 copy of this judgment. Till such time as orders are passed on Exts.P3 and P4, any proceedings for recovery of amounts under Exts.P1 and P2 shall remain suspended.

The writ petition is disposed of as above. GOPINATH P. JUDGE ajt

WP(C) NO. 29814 OF 2022 4

Appendix — schedule of exhibits

APPENDIX OF WP(C) 29814/2022 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE ORDER DATED 26.7.2018 ISSUED BY THE 2ND RESPONDENT UNDER SECTION 271D READ WITH SECTION 269SS OF THE INCOME TAX ACT AGAINST THE PETITIONER Exhibit P2 - TRUE COPY OF THE ORDER DATED 26.7.2018 ISSUED BY THE 2ND RESPONDENT UNDER SECTION 271E READ WITH SECTION 269T OF THE INCOME TAX ACT AGAINST THE PETITIONER Exhibit P3 TRUE COPY OF THE APPEAL PREFERRED BY THE PETITIONER AGAINST EXHIBIT P1 DATED 29.08.2018 BEFORE THE 3RD RESPONDENT. Exhibit P4 TRUE COPY OF THE APPEAL PREFERRED AGAINST EXT P2 ORDER DATED 29.08.2018 BEFORE THE 3RD RESPONDENT Exhibit P5 TRUE COPY OF THE ORDER DATED 28.07.2022 ISSUED BY THE 4TH RESPONDENT TO THE PETITIONER Exhibit P6 - TRUE COPY OF THE JUDGMENT DATED 03.01.2022 IN WP(C) 30703/2021 OF THIS HON'BLE COURT

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