NADATHARA FARMER'S SERVICE CO-OP. BANK LTD.NO.3499 vs. THE INCOME TAX OFFICER,
What did the High Court hold?
The High Court of Kerala did not decide the merits of the case. Instead, it noted that the petitioner had already preferred an appeal (Ext.P4) which was pending before the appellate authority (additional 3rd respondent). Therefore, the Court deemed it fit to dispose of the writ petition by directing the appellate authority to consider the appeal expeditiously. The Court also directed that no coercive steps shall be initiated against the petitioner pursuant to the assessment order (Ext.P2) until the disposal of the appeal. The specific finding on the Section 80P deduction and the applicability of the Supreme Court judgment were left to be decided by the appellate authority.
What were the facts?
The petitioner, Nadathara Farmer's Service Co-op. Bank Ltd., is a Primary Agricultural Credit Society. The Income Tax Officer (ITO) issued an assessment order on September 27, 2021, rejecting the petitioner's claim for deduction under Section 80P. The ITO's reasoning was that the petitioner did not satisfy the ingredients of a Primary Agricultural Credit Society as per the Kerala Co-operative Societies Act. The petitioner appealed this order to the Commissioner of Income Tax (Appeals). The petitioner argued that the Supreme Court judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax, which was rendered prior to the assessment order, was not considered by the assessing officer. The appeal was pending before the appellate authority.
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 Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax. Assessee's contentions: The petitioner argued that the assessment order was passed subsequent to the Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax, and this crucial judgment was not considered by the assessing officer. The petitioner contended that the assessment order was therefore flawed. Revenue's contentions: The judgment does not record any specific contentions from the revenue regarding this issue. The revenue's position is implicitly represented by the assessment order passed by the ITO.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
JUDGMENT Petitioner is a Primary Agricultural Credit Society registered under the Kerala Co-operative Societies Act, 1969. Ext.P2 order of assessment was issued against the petitioner on 27.09.2021. 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.
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] was not considered by the assessing officer though the assessment order was rendered subsequent to the Supreme Court Judgment.
Since the petitioner has already preferred an appeal as Ext.P4 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.
Though the appeal is filed before the 2nd respondent, it is pointed out by the learned counsel for the petitioner that, now the appeal is required to be considered by the additional 3rd respondent.
Accordingly, there will be a direction to the additional 3rd respondent or the competent Appellate Authority to consider and pass appropriate orders on Ext.P4, as expeditiously as possible.
Till the disposal of the appeal, no coercive steps shall be initiated against the petitioner pursuant to Ext.P2 assessment order. The writ petition is disposed of as above. BECHU KURIAN THOMAS JUDGE vps
Appendix — schedule of exhibits
More judgments on Section 80P
- Shree Bandharda Seva Sahkari Mandli Ltd… vs Income Tax Officer Ward -4, JunagadhITA 881/RJT/2025[2019-20]Status: Disposed19 Oct 2026AY 2019-20
- Duddukuru Primary Agricultural Cooperative… vs ITO, Ward - 1, TadepalligudemITA 258/VIZ/2026[2015-16]Status: Disposed16 Oct 2026AY 2015-16
- Parthasaradhi Mutually Aided Co-Operative… vs Income-Tax Officer, Ward-17(1), HyderabadITA 2322/HYD/2026[AY 2016-17]Status: Disposed16 Oct 2026
- Jijamata Mahila Gramin Bigar Sheti Sahakari… vs ITO Ward -1, BhandraITA 102/NAG/2026[2020-21]Status: Disposed12 Oct 2026AY 2020-21
- Shri Na vs Ari Khedut Sahkari Society Ltd…ITA 362/SRT/2025[2016-17]Status: Disposed9 Oct 2026AY 2016-17
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