ITHITHANAM SERVICE CO-OPERATIVE BANK LTD. vs. ADDITIONAL/JOINT/DEPUTY AND ASSISTANT COMMISSIONER OF INCOME TAX

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WP(C)/23696/2021HC KeralaKLHC01060294202101 November 2021Author: HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS4 pages
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What did the High Court hold?

The High Court directed the 1st respondent (Commissioner of Income Tax (Appeals)) to dispose of the appeal filed by the petitioner as expeditiously as possible in a time-bound manner. The Court acknowledged the exceptional circumstances, particularly the Supreme Court judgment relied upon by the assessee. Consequently, there was a stay of all coercive steps against the assessment order pending the disposal of the appeal. The Court did not decide the merits of the Section 80P deduction claim itself, but rather focused on expediting the appellate process and providing interim relief. The ratio is that pending appeals, especially those involving established legal precedents, should be expedited, and interim relief can be granted in exceptional circumstances.

What were the facts?

The petitioner, Ithithanam Service Co-operative Bank Ltd., filed a writ petition seeking a direction to consider its appeal (Ext.P3) expeditiously without insisting on payment for stay of demand arising from an assessment order (Ext.P1). The appeal concerns the entitlement to deduction under Section 80P of the Income Tax Act. The petitioner argued that the matter is covered by a Supreme Court judgment. The respondents are tax authorities, including the National E-Assessment Centre and the Commissioner of Income Tax (Appeals). The assessment order was passed by an unspecified authority, and the appeal is pending before the Commissioner of Income Tax (Appeals). The dispute involves the tax demand raised by the assessment order.

What were the issues?

1. Whether the appellate authority should be directed to consider and pass orders on the petitioner's appeal expeditiously, without insisting on payment for stay of demand? (Question of procedure and administrative direction). The petitioner contended that the appeal should be disposed of quickly, citing the Supreme Court judgment in Mavilayi Service Co-operative Bank Ltd. & Others v. Commissioner of Income Tax, Calicut & Another, which they argue covers the issue of Section 80P deduction. The revenue did not record any specific arguments on this procedural issue.

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 BECHU KURIAN THOMAS MONDAY, THE 1ST DAY OF NOVEMBER 2021 / 10TH KARTHIKA, 1943 WP(C) NO. 23696 OF 2021 PETITIONER : ITHITHANAM SERVICE CO-OPERATIVE BANK LTD., MALAKUNNAM P. O., CHANGANACHERRY, KOTTAYAM - 686 535, REPRESENTED BY ITS SECRETARY, MRS. SENSAMMA SEBASTIAN. BY ADVS. A.KUMAR P.J.ANILKUMAR G.MINI(1748) P.S.SREE PRASAD RESPONDENTS : 1 ADDITIONAL/JOINT/DEPUTY AND ASSISTANT COMMISSIONER OF INCOME TAX, NATIONAL E-ASSESSMENT CENTRE, DELHI - 110 001. 2 THE COMMISSIONER OF INCOME TAX (APPELAS) NATIONAL FACELESS APPEAL CENTRE, DELHI - 110001. BY ADV.JOSE JOSEPH, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 01.11.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 23696 OF 2021 2 BECHU KURIAN THOMAS, J. =-=-=-=-=-=-=-=-=-=-=-=-=-= W.P.(C) No.23696 of 2021 =-=-=-=-=-=-=-=-=-=-=-=-=-= Dated this the 1st day of November, 2021

JUDGMENT The writ petitioner seeks for a direction to consider and pass orders on Ext.P3 appeal as expeditiously as possible without insisting on any payment of any amount for stay of the demand as per Ext.P1 assessment order.

2.

I have heard Adv.A.Kumar, learned counsel for the writ petitioner as well as the learned Standing Counsel, Sri.Jose Joseph for the respondents.

3.

The issue in the appeal before the appellate court arises from an assessment order, in which the question of entitlement of the benefit of deduction under Section 80P of the Income Tax arises for consideration. The judgment in Mavilayi Service Co-operative Bank Ltd. & Others v. Commissioner of Income Tax, Calicut & Another reported in [2021 (1) KHC 303] governs the appeal.

4.

Since the assessment order is already challenged and is now pending in appeal before the 1st respondent, I am of the opinion that in the circumstances of the case, the appeal itself can be WP(C) NO. 23696 OF 2021 3 directed to be disposed of in a time bound manner and as expeditiously as possible, taking note of the contention of the counsel for the assessee that the matter is covered by the decision of the apex court.

5.

In the circumstances, there will be a direction to the 1st respondent to dispose of the appeal filed by the petitioner as expeditiously as possible in a time bound manner. Taking note of the exceptional circumstances arising in the case, especially, in the light of the Supreme Court judgment referred to above, there shall be a stay of all coercive steps against Ext.P1 assessment order pending disposal of the appeal before the 1st respondent. The writ petition is disposed of accordingly. BECHU KURIAN THOMAS, JUDGE RKM

WP(C) NO. 23696 OF 2021 4

Appendix — schedule of exhibits
APPENDIX OF WP(C) 23696/2021 PETITIONER'S EXHIBITS : Exhibit P1 TRUE COPY OF THE ASSESSMENT ORDER FOR THE ASSESSMENT YEAR 2018-19 DATED 30.03.2021. Exhibit P2 TRUE COPY OF THE DEMAND NOTICE DATED 30.03.2021. Exhibit P3 TRUE COPY OF THE MEMORANDUM OF APPEAL DATED 30.04.2021. Exhibit P4 TRUE COPY OF THE APPLICATION FOR STAY DATED 22.10.2021. Exhibit P5 TRUE COPY OF THE JUDGMENT IN ITA NO.72/2019 AND CONNECTED CASE DATED 16.03.2021. Exhibit P6 TRUE COPY OF THE ORDER IN WRIT PETITION (C) NO.10451/2021 DATED 27.04.2021.

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