MEENANGADI SERVICE COOPERATIVE BANK LTD. vs. 1. INCOME TAX OFFICER, AYAKAR BHAVAN, KALPETTA-673122

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WP(C)/29124/2022HC KeralaKLHC01061640202206 September 2022Author: HONOURABLE MR.JUSTICE N.NAGARESH4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court directed the competent appellate authority to consider and pass appropriate orders on the appeals filed by the petitioner expeditiously, preferably within six months from the date of receipt of the judgment. The Court also directed the respondents not to pursue recovery proceedings against the petitioner until the appeals are disposed of. This decision was made in view of similar orders passed by the Court and the circumstances presented. The Court did not decide on the merits of the penalty orders themselves but focused on ensuring the timely disposal of the pending appeals and preventing coercive recovery actions during the pendency of the appeals.

What were the facts?

The petitioner, Meenangadi Service Co-operative Bank Ltd., is a Primary Agricultural Credit Co-operative Society. For the assessment year 2015-16, penalty orders under Sections 271D and 271E of the Income Tax Act, 1961, were issued to the petitioner. The petitioner challenged these penalty orders by filing appeals before the Joint Commissioner of Income Tax (Appeals) in 2018. The petitioner's grievance is that despite the lapse of over two years, the appeals remain undisposed of, and simultaneously, recovery proceedings have been initiated for the penalty amounts. The Revenue's submission is that due to the introduction of the Faceless Assessment Scheme, the appeals need to be transferred to the Faceless Appellate Authority.

What were the issues?

1. Whether the delay in disposing of the appeals filed by the petitioner against the penalty orders under Sections 271D and 271E for assessment year 2015-16 warrants intervention by the High Court under its writ jurisdiction? (Question of law and fact) Assessee's Contention: The petitioner argued that their appeals, filed in 2018, have not been disposed of for over two years, and recovery proceedings are being initiated, causing prejudice. They relied on the principle of expeditious disposal of appeals. Revenue's Contention: The Revenue submitted that the appeals need to be transferred to the Faceless Appellate Authority due to the implementation of the Faceless Assessment Scheme, implying a procedural necessity for the delay.

Which sections of the Income-tax Act were involved?

Section 271D,Section 271E

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 N.NAGARESH TUESDAY, THE 6TH DAY OF SEPTEMBER 2022/ 15TH BHADRA, 1944 WP(C) NO. 29124 OF 2022 PETITIONER: MEENANGADI SERVICE COOPERATIVE BANK LTD. MEENANGADI P.O., MEENANGADI, WAYANAD DISTRICT-673591 REPRESENTED BY ITS SECRETARY. BY ADV KEERTHIVAS GIRI RESPONDENTS: 1 INCOME TAX OFFICER, AYAKAR BHAVAN, KALPETTA-673122. 2 JOINT COMMISSIONER OF INCOME TAX, OFFICE OF THE INCOME TAX DEPARTMENT, RANGE-II, KOZHIKODE-673001. 3 THE COMMISSIONER OF INCOME TAX (APPEALS), AYAKAR BHAVAN, KOZHIKODE DISTRICT-673001. 4 PRINCIPAL COMMISSIONER OF INCOME TAX, AYAKAR BHAVAN, KOZHIKODE - 673001 5 NATIONAL FACELESS APPEAL CENTRE, C BLOCK, SPM CIVIC CENTRE, NEW DELHI - 110001, REPRESENTED BY PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX (NFAC). SRI.JOSE JOSEPH, SC, INCOME TAX DEPARTMENT Sri.Christopher Abraham THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06.09.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C).No.29124 of 2022 ..2.. JUDGMENT Dated this the 06th day of September, 2022 Petitioner is a Primary Agricultural Credit Co-operative Society. By Exts.P1 and P2, petitioner was imposed with penalty under Sections 271D and 271E respectively for the assessment year 2015-'16. Challenging the said penalty orders, appeals were preferred before the 3rd respondent in 2018. The grievance of the petitioner is that in spite of lapse of 2 years, the 3rd respondent has not disposed of the appeals and in the meantime, proceedings are initiated to recover the amounts imposed under Ext.P1 and Ext.P2. 2. Sri.Christopher Abraham, the learned Standing Counsel for the respondents submitted that after the coming into force of Faceless Assessment Scheme, the appeals are required to be heard by the Faceless Appellate Authority and the 3rd respondent will have to transfer the memorandum of appeals to the appellate assessment centre. W.P.(C).No.29124 of 2022 ..3.. 3. Having regard to the circumstances of the case and having regard to the submissions made by the learned counsel for the petitioner as well as the learned counsel for the respondents, I deem it fit to dispose of this writ petition directing the competent appellate authority to consider and pass appropriate orders on the appeals, filed as Exts.P3 and P4, as expeditiously as possible, at any rate, within a period of six months from the date of receipt of a copy of this judgment. In view of similar orders passed by this Court, copy of which is produced as Ext.P6, there will be a direction to the respondents not to pursue recovery proceedings against the petitioner, till such disposal. The writ petition is disposed of accordingly. Sd/- N. NAGARESH, JUDGE skj W.P.(C).No.29124 of 2022 ..4.. APPENDIX OF WP(C) 29124/2022 PETITIONER'S EXHIBITS Exhibit P1 TRUE COPY OF THE ORDER DATED 26.7.2018 ISSUED BY THE 2ND RESPONDENT UNDER SECTION 271D READ WITH SECTION 269SS OF THE INCOME TAX ACT AGAINST THE PETITIONER Exhibit P2 TRUE COPY OF THE ORDER DATED 26.7.2018 ISSUED BY THE 2ND RESPONDENT UNDER SECTION 271E READ WITH SECTION 269T OF THE INCOME TAX ACT AGAINST THE PETITIONER Exhibit P3 TRUE COPY OF THE APPEAL PREFERRED BY THE PETITIONER AGAINST EXHIBIT P1 DATED 29.8.2018 BEFORE THE 3RD RESPONDENT. Exhibit P4 TRUE COPY OF THE APPEAL PREFERRED

BEFORE THE 3RD RESPONDENT.

Exhibit P5OF THE ORDER DATED 28.07.2022 ISSUED BY THE 4TH RESPONDENT TO THE PETITIONER.

Exhibit P6OF THE JUDGMENT DATED 03.01.2022 IN WP(C) 30703/2021 OF THIS COURT

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