KUNDAYAM SERVICE CO-OPERATIVE BANK LTD. NO.3259, vs. THE INCOME TAX OFFICER

WP(C)/36624/2022HC KeralaKLHC01078620202216 November 2022Author: HONOURABLE MR. JUSTICE GOPINATH P.3 pages

AI SummaryRemanded

What did the High Court hold?

The High Court disposed of the writ petition by directing the Income Tax Appellate Tribunal (3rd respondent) to consider and pass orders on the stay petition (Ext.P4) filed in the appeal (Ext.P3) within a period of two months from the date of receipt of a certified copy of the judgment. Furthermore, the court ordered that all proceedings for the recovery of amounts due under the penalty order (Ext.P1), as confirmed by the First Appellate Authority (Ext.P2), shall be deferred until orders are passed on the stay petition. The court did not decide on the merits of the penalty or the appeal itself, focusing solely on the procedural aspect of the pending stay application and the potential for coercive recovery.

What were the facts?

The petitioner, Kundayyam Service Co-operative Bank Ltd., faced a penalty order under Section 271-B of the Income Tax Act, 1961. An appeal to the First Appellate Authority resulted in the confirmation of the penalty by an order dated 08-09-2022. Subsequently, the petitioner filed a further appeal before the Income Tax Appellate Tribunal (3rd respondent) along with an application for stay. The petitioner's primary concern was the initiation of recovery proceedings for the penalty amount while the stay petition was pending before the Tribunal. The writ petition was filed before the High Court of Kerala seeking directions regarding the pending stay application and to defer recovery proceedings.

What were the issues?

1. Whether the High Court should direct the Income Tax Appellate Tribunal to expedite the consideration of the stay petition filed by the assessee? (Question of procedure) Assessee's Contention: The petitioner argued that recovery proceedings might be initiated pending the disposal of their stay petition before the Tribunal, causing prejudice. They sought a direction for the Tribunal to consider the stay petition expeditiously and a deferment of recovery proceedings until then. Revenue's Contention: The judgment records that the learned Standing Counsel for the revenue was heard, but their specific contentions are not detailed. However, the court's disposal implies that the revenue did not object to the directions issued.

Which sections of the Income-tax Act were involved?

Section 271-B

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 16TH DAY OF NOVEMBER 2022 / 25TH KARTHIKA, 1944 WP(C) NO. 36624 OF 2022 PETITIONER: KUNDAYAM SERVICE CO-OPERATIVE BANK LTD. NO.3259, AGED 56 YEARS REPRESENTED BY ITS SECRETARY, KUNDAYAM P.O, PATHANAPURAM, KOLLAM DISTRICT, PIN - 689695 BY ADVS. ARJUN RAGHAVAN T.R.HARIKUMAR RESPONDENTS: 1 THE INCOME TAX OFFICER, WARD-4, OFFICE OF THE JOINT COMMISSIONER OF INCOME TAX, KOLLAM RANGE, AAYAKAR BHAVAN, NEAR KARBALA JUNCTION, KOLLAM, PIN - 691001 2 THE COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEAL CENTRE, NORTH BLOCK, DELHI. , PIN - 110001 3 THE REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH, KENDRIYA BHAVAN, BLOCK NO.C1 & C2, 1ST FLOOR, KAKKANAD, COCHIN, PIN - 682030 4 THE KERALA STATE CO-OPERATIVE BANK REPRESENTED BY ITS CHIEF EXECUTIVE OFFICER, P.B NO.6515, CO-BANK TOWERS, PALAYAM, THIRUVANATHAPURAM. , PIN - 695033 BY ADVS. CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT THOMAS ABRAHAM THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 16.11.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P (C) No.36624/2022 -2-

J U D G M E N T The petitioner suffered an order of penalty under Section 271-B of the Income Tax Act, 1961. The petitioner preferred an appeal before the First Appellate Authority who confirmed the penalty by Ext.P2 order dated 08-09-2022. The petitioner has now preferred Ext.P3 appeal before the 3rd respondent Tribunal along with Ext.P4 application for stay. The petitioner apprehends that pending consideration of the stay petition by the 3rd respondent Tribunal, proceedings may initiated to recover the amounts due from the petitioner.

Heard the learned Standing Counsel also.

Having regard to the facts and circumstances of the case, this writ petition will stand disposed of directing the 3rd respondent Tribunal to consider and pass orders on Ext.P4 stay petition filed in Ext.P3 appeal within a period of 2 months from the date of receipt of a certified copy of the judgment. Till such time orders as passed on Ext.P4, any proceedings for recovery of amounts due under Ext.P1 order of penalty as confirmed in Ext.P2 shall be deferred. GOPINATH P. JUDGE AMG

W.P (C) No.36624/2022 -3-

Appendix — schedule of exhibits

APPENDIX OF WP(C) 36624/2022 PETITIONER EXHIBITS Exhibit-P1 A TRUE COPY OF THE PENALTY ORDER DATED 29-03-2019 ISSUED BY THE 1ST RESPONDENT Exhibit-P2 A TRUE COPY OF THE ORDER DATED 08-09-2022 ISSUED BY THE 2ND RESPONDENT Exhibit-P3 A TRUE COPY OF THE APPEAL MEMORANDUM ALONG WITH AFFIDAVIT AND CHELAN DATED 05-11-2022, FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT TRIBUNAL Exhibit-P4 A TRUE COPY OF THE STAY PETITION FILED IN EXT-P3 APPEAL, DATED 05-11-2022 Exhibit-P5 A TRUE COPY JUDGMENT DATED 08-07-2019 IN WP(C) NO.18484 OF 2019 OF THIS HON'BLE COURT

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