ULIYACOVIL SERVICE CO-OPERATIVE BANK LTD vs. THE COMMISIONER OF INCOME TAX (APPEALS)

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WP(C)/22625/2022HC KeralaKLHC01046921202213 July 2022Author: HONOURABLE MR. JUSTICE GOPINATH P.3 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala did not decide the merits of the case. Instead, it directed the Commissioner of Income Tax (Appeals) (1st respondent) to consider and pass appropriate orders on the petitioner's pending appeal (Ext.P2) expeditiously, within a period of 2 months from the date of receipt of a copy of the judgment. The Court also ordered that no coercive steps shall be initiated against the petitioner pursuant to the assessment order (Ext.P1) and another order (Ext.P3) until the disposal of the appeal. The primary issue regarding the applicability of the Mavilayi Service Co-operative Bank Ltd. judgment and the eligibility for deduction under Section 80P was left to be decided by the appellate authority.

What were the facts?

The petitioner, Uliacovil Service Co-operative Bank Ltd., a Primary Agricultural Credit Society, challenged an assessment order (Ext.P1) issued by the Income Tax Officer. The assessment order rejected the bank's claim for deduction under Section 80P of the Income Tax Act, 1961, citing a lack of evidence that the petitioner satisfied the ingredients of a Primary Agricultural Credit Society under the Kerala Co-operative Societies Act, 1969. The petitioner had filed an appeal (Ext.P2) before the Commissioner of Income Tax (Appeals) (1st respondent), arguing that the Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax; 2021 (1) KLT 485 rendered the assessment incorrect. The High Court of Kerala was considering a writ petition filed by the bank.

What were the issues?

1. Whether the assessment order rejecting the deduction under Section 80P, based on the petitioner not satisfying the ingredients of a Primary Agricultural Credit Society under the Kerala Co-operative Societies Act, is legally sustainable, considering the Supreme Court's decision in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax; 2021 (1) KLT 485? (Question of law and mixed fact and law, concerning Section 80P of the Income Tax Act, 1961 and the Kerala Co-operative Societies Act, 1969). Assessee's Contention: The petitioner 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 renders the assessment incorrect. Revenue's Contention: The judgment does not record any specific contentions made by the revenue in the writ petition.

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. WEDNESDAY, THE 13TH DAY OF JULY 2022 / 22ND ASHADHA, 1944 WP(C) NO. 22625 OF 2022 PETITIONER: ULIYACOVIL SERVICE CO-OPERATIVE BANK LTD (NO.1003) ASRAMOM, KOLLAM REPRESENTED BY ITS SECRETARY K K SANTHI, PIN - 691002 BY ADVS. MARTHANDA VARMA PANDALAI.K S.HEMALATHA RESPONDENTS: 1 THE COMMISIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEALS CENTRE (NFAC), INCOME TAX DEPARTMENT, DELHI, PIN - 110001 2 INCOME TAX OFFICER WARD-4, KOLLAM, PIN - 691001 BY ADV CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 13.07.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P (C) No.22625/2022

J U D G M E N T Petitioner is a Co-operative bank registered as Primary Agricultural Credit Society under the provisions of the Kerala Co-operative Societies Act, 1969. Ext.P1 order of assessment was issued against the petitioner. 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 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 per Ext.P2 and the same is pending consideration before the 1st respondent, I deem it fit that this writ petition be disposed of directing the 1st respondent to consider the appeal in a time bound manner.

4.

Accordingly, there will be a direction to the 1st respondent to consider and pass appropriate orders on Ext.P2, as expeditiously as possible within a period of 2 months from the date of receipt of a copy of a this judgment.

.

5.

Till the disposal of the appeal, no coercive steps shall be initiated against the petitioner pursuant to Exts.P1 & P3 . The writ petition is disposed of as above. GOPINATH P. JUDGE AMG

W.P (C) No.22625/2022

Appendix — schedule of exhibits
APPENDIX OF WP(C) 22625/2022 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE ASSESSMENT ORDER-INTIMATION U/S 143(1) PASSED ON 28/5/2020 FOR THE A.Y.2019-20 Exhibit P2 TRUE COPY OF THE APPEAL FILED ON 26-06-2020 Exhibit P3 TRUE COPY OF THE NOTICE(U/S 221 OF THE IT ACT) DATED7-7-2022 ISSUED BY THE 2ND RESPONDENT

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