THE MULLASSERY SERVICE CO-OPERATIVE SOCIETY LTD NO.R.280 vs. THE COMMISSIONER OF INCOME TAX (APPEALS)

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WP(C)/36540/2022HC KeralaKLHC01078435202217 November 2022Author: HONOURABLE MR. JUSTICE GOPINATH P.4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court did not decide the merits of the appeal. Instead, it directed the Income Tax Appellate Tribunal (1st respondent) to consider and pass appropriate orders on the petitioner's pending appeal (Ext.P3) 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) until the disposal of the appeal. The High Court did not expressly leave any issue undecided, but rather deferred the decision on the substantive issues to the Tribunal.

What were the facts?

The petitioner, The Mullassery Service Co-operative Society Ltd., a Primary Agricultural Credit Society, challenged an assessment order (Ext.P1) issued by the Income Tax Officer (3rd respondent). The assessment order rejected the petitioner's claim for deduction under Section 80P, stating there was no evidence that the petitioner satisfied the criteria of a Primary Agricultural Credit Society as per the Kerala Co-operative Societies Act. 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 now governs the field and renders the assessment incorrect. The petitioner had already filed an appeal (Ext.P3) against the assessment order, which was pending before the Income Tax Appellate Tribunal (1st respondent). The High Court was considering a writ petition (WP(C) No. 36540 of 2022) filed by the petitioner.

What were the issues?

1. Whether the assessment order rejecting the deduction under Section 80P is legally sustainable, considering the judgment of the Supreme Court in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax; 2021 (1) KLT 485? (Question of law) Assessee's contentions: The assessee argued that the assessment order was incorrect because the Supreme Court's decision in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax; 2021 (1) KLT 485 governs the present case and supports their claim for deduction under Section 80P. They relied on this Supreme Court judgment. Revenue's contentions: The judgment does not record any specific contentions made by the revenue in response to 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. THURSDAY, THE 17TH DAY OF NOVEMBER 2022 / 26TH KARTHIKA, 1944 WP(C) NO. 36540 OF 2022 PETITIONER: 1 THE MULLASSERY SERVICE CO-OPERATIVE SOCIETY LTD NO.R.280 P.O.MULLASSERY, THRISSUR - 680 509, REPRESENTED BY ITS SECRETARY., PIN - 680509 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- 110002., PIN - 110002 2 THE PRINCIPAL COMMISSIONER OF INCOME TAX O/O THE PRINCIPAL COMMISSIONER OF INCOME TAX, AYAKAR BHAVAN, MANANCHIRA, KOZHIKODE, KERALA - 673001. , PIN - 673001 3 THE INCOME TAX OFFICER WARD 1 & TPS, CITY PLAZA, INCOME TAX OFFICE, WEST NADA, GURUVAYOOR, KERALA - 680 101., PIN - 680101 BY ADV CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 17.11.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WPC No.36540 of 2022 2 JUDGMENT Dated this the 17th day of November, 2022 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. 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. WPC No.36540 of 2022 3 3. Since the petitioner has already preferred an appeal as Ext.P3 and the same is pending consideration before the Income Tax Appellate Tribunal (1st respondent), I deem it fit that this writ petition be disposed of directing the Tribunal 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.P3, as expeditiously as possible within a period of 2 months from the date of receipt of a copy of this

judgment.

5.

Till the disposal of the appeal, no coercive steps shall be initiated against the petitioner pursuant to Ext.P1. The writ petition is disposed of as above. GOPINATH P. JUDGE SKP/17-11

WPC No.36540 of 2022 4 APPENDIX OF WP(C) 36540/2022 PETITIONER’S EXHIBITS: EXHIBIT P1 EXHIBIT P1:- THEOF THE ASSESSMENT ORDER DURING THE ASSESSMENT YEAR 2020-2021 EXHIBIT P2 EXHIBIT P2:- THEOF THE DEMAND NOTICE EXHIBIT P3 EXHIBIT P3:- THEOF THE APPEAL DATED 26/10/2022 EXHIBIT P4 EXHIBIT P4:- THEOF THE ACKNOWLEDGEMENT RECEIPT OF INCOME TAX FORMS SHOWING THE FILING OF THE APPEAL ON 26/10/2022 EXHIBIT P5 EXHIBIT P5:- THEOF THE STAY PETITION DATED 24/10/2022 FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENT EXHIBIT P6 EXHIBIT P6:- THEOF THE JUDGMENT IN W.A.NO.1536 OF 2019 DATED 1/7/2019 EXHIBIT P7 EXHIBIT P7:-OF THE JUDGMENT DATED 19.07.2021 IN WPC NO. 14282/2021 OF THIS HONOURABLE COURT EXHIBIT P8 EXHIBIT P8:-OF THE JUDGMENT DATED 27.10.2022 IN WPC 34067/2022 OF THIS HONOURABLE COURT RESPONDENTS' EXHIBITS:NILP.A.TO JUDGE

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