THE MUNDUR SERVICE CO-OPERATIVE BANK LTD vs. THE INCOME TAX OFFICER

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WP(C)/20164/2020HC KeralaKLHC01050436202029 September 2020Author: HONOURABLE DR. JUSTICE A.K.JAYASANKARAN NAMBIAR4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala, while not deciding the merits of the appeal concerning Section 80P deduction, disposed of the writ petition. The Court directed the 3rd respondent (Income Tax Appellate Tribunal) to consider and pass orders on the petitioner's appeal (Ext.P3) within six months from the date of receiving the judgment, after hearing the petitioner. Crucially, the Court ordered that recovery steps for the amounts confirmed by Exts.P1 and P2 orders shall be kept in abeyance until the Tribunal passes its order and communicates it to the petitioner. The principle here is that the High Court can direct expeditious disposal of appeals and grant interim relief by staying recovery pending such disposal, especially when similar matters have been treated so.

What were the facts?

The petitioner, The Mundur Service Co-Operative Bank Ltd., filed a writ petition before the High Court of Kerala. The petitioner was aggrieved by an assessment order (Ext.P1) passed under the Income Tax Act. An appeal against this order to the First Appellate Authority was rejected by Ext.P2. Subsequently, the petitioner filed an appeal (Ext.P3) along with a stay petition (Ext.P4) before the Income Tax Appellate Tribunal (3rd respondent). The core issue in the appeal pertains to the deduction under Section 80P of the Income Tax Act as applicable to Co-Operative Societies. The petitioner sought directions for the Tribunal to decide the appeal and a stay on recovery proceedings.

What were the issues?

1. Whether the petitioner, a Co-Operative Bank, is eligible for deduction under Section 80P of the Income Tax Act, 1961? (Question of law) Assessee's Contention: The petitioner argues that the appeal before the Tribunal involves the permissibility of deduction under Section 80P of the Income Tax Act in its application to Co-Operative Societies. They rely on previous High Court judgments in similar matters where directions were issued to the appellate authority to consider the appeal and stay recovery proceedings. Revenue's Contention: The judgment does not record any specific arguments made by the revenue on the merits of the Section 80P deduction. The revenue's participation is through the learned Standing Counsel representing the respondents.

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 A.K.JAYASANKARAN NAMBIAR TUESDAY, THE 29TH DAY OF SEPTEMBER 2020 / 7TH ASWINA, 1942 WP(C).No.20164 OF 2020(U) PETITIONER/S: THE MUNDUR SERVICE CO-OPERATIVE BANK LTD CO-OPERATIVE BANK LTD., NO. F. 1650, MUNDUR, PALAKKAD 678 592, REPRESENTED BY ITS SECRETARY, JIJUMON .A.J., BY ADVS. SRI.HARISANKAR V. MENON SMT.MEERA V.MENON SMT.K.KRISHNA RESPONDENT/S: 1 THE INCOME TAX OFFICER WARD-2, AYAKAR BHAVAN, PALAKKAD 670 014. 2 THE COMMISSIONER OF INCOME TAX (APPEALS), THRISSUR 680 021. 3 THE INCOME TAX APPELLATE TRIBUNAL), AYAKAR BHAVAN, KAKKANDU, KOCHI 682 030, REPRESENTED BY ITS REGISTRAR. OTHER PRESENT: SC: JOSE JOSEPH THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 29.09.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.20164 OF 2020(U) 2

JUDGMENT Against Ext.P1 assessment order under the Income Tax Act, the petitioner preferred an appeal before the First Appellate Authority but the same was rejected by Ext.P2 order. Aggrieved by the said order, the petitioner preferred Ext.P3 appeal along with Ext.P4 stay petition before the 3rd respondent. It is the contention of the learned counsel for the petitioner that the issue involved in the appeal is the permissibility of deduction under Section 80P of the Income Tax Act in its application to Co-Operative Societies. It is pointed out that in similar matters this Court has directed the appellate authority to consider and pass orders in the appeal and stayed the recovery proceedings, in the meanwhile.

2.

I have heard the learned counsel appearing for the petitioner as also the learned Standing Counsel appearing for the respondents. On a consideration of the facts and circumstances of the case and the submissions made across the Bar and the finding that in similar cases this Court has granted stay of recovery proceedings, pending disposal of the appeal by the appellate authority, I dispose the writ petition by directing the 3rd respondent to consider and pass orders on Ext.P3 appeal preferred by the petitioner within an outer time limit of six months from the date of receipt of a copy of this judgment, after hearing the petitioner. I also make it clear that till such time as orders are passed by the 3rd respondent in the appeal as WP(C).No.20164 OF 2020(U) 3 directed above and the orders communicated to the petitioner, recovery steps for recovery of amounts confirmed against the petitioner by Exts.P1 and P2 orders shall be kept in abeyance. The petitioner shall produce a copy of this judgment together with a copy of the writ petition before the 3rd respondent for further action. A.K.JAYASANKARAN NAMBIAR JUDGE SJ

WP(C).No.20164 OF 2020(U) 4

Appendix — schedule of exhibits
APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 COPY OF ASSESSMENT ORDER ISSUED BY THE 1ST RESPONDENT FOR THE YEAR 2010-11 DATED 24.03.2016. EXHIBIT P2 COPY OF APPELLATE ORDER ISSUED BY THE 2ND RESPONDENT FOR THE YEAR 2010-11 DATED 25.08.2020. EXHIBIT P3 COPY OF APPEAL FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT 2010-11 DATED 19.9.2020. EXHIBIT P4 COPY OF STAY PETITION FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT DATED 19.09.2020.

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