THE PUNNAYUR PANCHAYAT SERVICE CO-OPERATIVE BANK LTD NO.P.584 vs. THE COMMISSIONER OF INCOME TAX (APPEALS)

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WP(C)/33658/2022HC KeralaKLHC01071780202225 October 2022Author: HONOURABLE MR. JUSTICE GOPINATH P.4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala, while acknowledging the pendency of the appeal filed by the petitioner (Ext.P3) before the first respondent (Commissioner of Income Tax (Appeals)), deemed it appropriate to dispose of the writ petition by directing the Appellate Authority to consider the appeal expeditiously. The Court issued a direction to the first respondent to consider and pass appropriate orders on Ext.P3 as expeditiously as possible. Furthermore, 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. The High Court did not decide on the merits of the Section 80P deduction claim itself, leaving that to the appellate authority.

What were the facts?

The petitioner, The Punnaur Panchayat Service Co-operative Bank Ltd., a Primary Agricultural Credit Society, received an assessment order dated August 2, 2022. The assessing officer rejected the bank's claim for deduction under Section 80P, stating there was no evidence that the petitioner satisfied the ingredients of a Primary Agricultural Credit Society as defined by the Kerala Co-operative Societies Act. The petitioner challenged this assessment order before the Commissioner of Income Tax (Appeals), the first respondent. The petitioner argued that the Supreme Court's judgment in Mavilayi Service Cooperative Bank Ltd. v. Commissioner of Income Tax, delivered prior to the assessment order, was not considered by the assessing officer.

What were the issues?

1. Whether the assessing officer erred in rejecting the petitioner's claim for deduction under Section 80P of the Income Tax Act, 1961, by failing to consider the ingredients of a Primary Agricultural Credit Society as contemplated under the Kerala Co-operative Societies Act. Assessee's Contentions: The petitioner contended that the assessment order was passed subsequent to the Supreme Court's judgment in Mavilayi Service Cooperative Bank Ltd. v. Commissioner of Income Tax, and this crucial judgment was not considered by the assessing officer. The petitioner argued that this oversight led to the erroneous rejection of their Section 80P deduction claim. Revenue's Contentions: The judgment does not record any specific contentions made by the revenue at this stage of 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. TUESDAY, THE 25TH DAY OF OCTOBER 2022 / 3RD KARTHIA, 1944 WP(C) NO. 33658 OF 2022 PETITIONER: 1 THE PUNNAYUR PANCHAYAT SERVICE CO-OPERATIVE BANK LTD NO.P.584 P.O.EDAKKARA- AKALAD, THRISSUR - 680 506, REPRESENTED BY ITS SECRETARY, PIN - 680506 BY ADV P.C.SASIDHARAN RESPONDENTS: 1 THE COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEAL CENTRE, ROOM NO.356 C.R. BUILDINGS, IP ESTATE, DELHI- 110 002., 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 I & TPS, INCOME TAX OFFICE, CITY PLAZA, WEST NADA, GURUVAYOOR- 680 101., PIN - 680101 BY ADV JOSE JOSEPH, STANDING COUNSEL, INCOME TAX DEPARTMENT, KERALA THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 25.10.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WPC No.33658 of 2022 2 JUDGMENT Dated this the 25th day of October, 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 on 02.08.2022. 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 canvass that the judgment of the Supreme Court in Mavilayi Service Cooperative Bank Ltd. v. Commissioner of Income Tax [2021 (1) KLT 485] was not considered by the assessing officer though the assessment order was rendered subsequent to the WPC No.33658 of 2022 3

Supreme Court Judgment.

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.

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 SKP/25-10

WPC No.33658 of 2022 4 APPENDIX OF WP(C) 33658/2022 PETITIONER'S EXHIBITS: EXHIBIT P1OF THE ASSESSMENT ORDER DATED 2/08/2022 FOR THE ASSESSMENT YEAR 2020-2021 ISSUED BY THE 1ST RESPONDENT EXHIBIT P2OF THE DEMAND NOTICE DATED 2/08/2022 ISSUED BY THE 1ST RESPONDENT EXHIBIT P3OF THE APPEAL DATED 31/8/2022 PREFERRED BY THE PETITIONER BEFORE THE 1ST RESPONDENT. EXHIBIT P4OF THE ACKNOWLEDGMENT OF RECEIPT OF FORM EVIDENCING OF FILING APPEAL DATED 31/08/2022 EXHIBIT P5OF THE STAY PETITION DATED 31/8/2022 FILED BEFORE THE 1ST RESPONDENT. EXHIBIT P6OF THE ORDER ISSUED BY THE 3RD RESPONDENT DATED 13/10/2022 EXHIBIT P7OF THE JUDGMENT IN W.P(C) NO. 14282/2021 DATED 19/07/2021 EXHIBIT P8OF THE JUDGMENT IN W.P(C) NO. 24854/2021 DATED 11-11-2021 RESPONDENTS' EXHIBITS:NILP.A.TO JUDGE

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