M/S. AKATHETHARA SERVICE CO-OPERATIVE BANK LTD. vs. THE ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/NCOME TAX OFFICER

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WP(C)/30599/2022HC KeralaKLHC01065030202227 September 2022Author: HONOURABLE MR. JUSTICE GOPINATH P.4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala did not decide the merits of the assessment order or the appeal. Instead, the Court deemed it fit to dispose of the writ petition by directing the Appellate Authority (National Faceless Appeal Centre) to consider and pass appropriate orders on the petitioner's pending appeal (Ext.P2) expeditiously. The Court also granted interim relief by directing that no coercive steps shall be initiated against the petitioner pursuant to the assessment order (Ext.P1) until the disposal of the appeal. The core principle applied is that when an appeal is pending before the appropriate authority, the High Court, in its writ jurisdiction, may direct expeditious disposal of the appeal and grant interim protection.

What were the facts?

The petitioner, Akathethara Service Co-operative Bank Ltd., a Primary Agricultural Credit Society, received an assessment order dated August 6, 2022. The Assessing Officer rejected the petitioner'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 under the Kerala Co-operative Societies Act. The petitioner challenged this assessment order by filing an appeal before the National Faceless Appeal Centre. The petitioner argued that the Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax now governs the field and renders the assessment incorrect. Since the appeal was pending, the petitioner filed a writ petition seeking a direction for the expeditious disposal of the appeal and a stay on coercive steps.

What were the issues?

1. Whether the assessment order dated August 6, 2022, rejecting the deduction under Section 80P of the Income Tax Act, 1961, is legally sustainable, considering the petitioner's status as a Primary Agricultural Credit Society under the Kerala Co-operative Societies Act, 1969. Assessee's Contentions: The petitioner contended that the assessment order is incorrect because the Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax governs the issue, implying that the deduction should have been allowed. The petitioner has already filed an appeal against the assessment order. Revenue's Contentions: The judgment does not record any specific contentions from the revenue regarding this issue. The assessment order itself rejected the deduction on the ground that the petitioner did not satisfy the ingredients of a Primary Agricultural Credit Society.

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 27TH DAY OF SEPTEMBER 2022 / 5TH ASWINA, 1944 WP(C) NO. 30599 OF 2022 PETITIONER/S: AKATHETHARA SERVICE CO-OPERATIVE BANK LTD. F-1514, AKATHETHARA POST, PALAKKAD, REPRESENTED BY ITS SECRETARY, SUBHA VARMA P. , PIN - 678008 BY ADVS. HARISANKAR V. MENON MEERA V.MENON R.SREEJITH K.KRISHNA RESPONDENT/S: 1 THE ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/NCOME TAX OFFICER NATIONAL FACELESS ASSESSMENT CENTRE DELHI , PIN - 110001 2 NATIONAL FACELESS APPEAL CENTRE NATIONAL FACELESS APPEAL CENTRE, DELHI , REPRESENTED BY THE COMMISSIONER OF INCOME TAX (APPEALS , PIN – 110001 ADV. JOSE JOSEPH (SC) THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 27.09.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 30599 OF 2022 2

JUDGMENT 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 06.08.2022. 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 2nd 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 Ext.P2 and the same is pending consideration before the 2nd 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.

WP(C) NO. 30599 OF 2022 3

4.

Accordingly, there will be a direction to the National Faceless Appeal Centre (2nd respondent) to consider and pass appropriate orders on Ext.P2, 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 ajt

WP(C) NO. 30599 OF 2022 4

Appendix — schedule of exhibits
APPENDIX OF WP(C) 30599/2022 PETITIONER EXHIBITS Exhibit P1 COPY OF ASSESSMENT ORDER ISSUED BY THE 1ST RESPONDENT FOR THE YEAR 2020-21 DTD. 06-08- 2022 Exhibit P2 COPY OF APPEAL FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DTD. 03-09-2022 Exhibit P3 COPY OF STAY PETITION FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DTD.03-09-2022

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