MORAZHA KALLIASSERY SERVICE CO-OPERATIVE BANK LTD., vs. THE CENTRAL BOARD OF DIRECT TAXES

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WP(C)/8934/2020HC KeralaKLHC01023080202021 July 2020Author: HONOURABLE DR. JUSTICE A.K.JAYASANKARAN NAMBIAR4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court, taking note of the petitioner's submission and finding that it has in similar matters directed the appellate authority to pass orders on the appeal and keep recovery proceedings in abeyance, disposed of the writ petition. The Court directed the 3rd respondent (Commissioner of Income Tax (Appeals)) to consider and pass orders on Ext.P2 series of appeals within a period of six months from the date of receipt of a copy of the judgment, after hearing the petitioner. Recovery steps for amounts confirmed against the petitioner by the assessment orders, and pursuant to Exts.P3 series of demand notices, shall be kept in abeyance until such time as orders are passed by the appellate authority and communicated to the petitioner. The specific finding on the permissibility of deduction under Section 80P was not decided by the High Court, as it was remitting the matter to the appellate authority.

What were the facts?

The petitioner, Morazha Kaliassery Service Co-operative Bank Ltd., is challenging assessment orders (Ext.P1 series) issued under the Income Tax Act. The petitioner has filed appeals (Ext.P2 series) and stay petitions (Ext.P4) before the Commissioner of Income Tax (Appeals), Kozhikode (3rd respondent). The core issue in the appeals concerns the permissibility of deduction under Section 80P of the Act, specifically its applicability to Co-operative Societies. The petitioner points out that this Court has previously directed appellate authorities to consider and pass orders on appeals in similar matters, while keeping recovery proceedings in abeyance. Demand notices (Exts.P3 series) have also been issued.

What were the issues?

1. Whether the Income Tax Appellate Tribunal (implied, as the High Court is disposing of a writ petition directing the appellate authority) should direct the appellate authority to consider and pass orders on the appeals filed by the petitioner concerning the deduction under Section 80P of the Income Tax Act, and in the interim, keep recovery proceedings in abeyance. Assessee's Contention: The petitioner argues that the issue involved in their appeals pertains to the permissibility of deduction under Section 80P of the Act in its applicability to Co-operative Societies. They rely on previous High Court judgments in similar matters where directions were issued to the appellate authority to dispose of appeals and keep recovery proceedings in abeyance. Revenue's Contention: No specific contention is recorded for the revenue in the judgment. The judgment proceeds based on the petitioner's submission and prior High Court pronouncements.

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 21ST DAY OF JULY 2020 / 30TH ASHADHA, 1942 WP(C).No.8934 OF 2020(N) PETITIONER/S: MORAZHA KALLIASSERY SERVICE CO-OPERATIVE BANK LTD., ANCHAMPEEDIKA P.O., KANNUR-670331, REPRESENTED BY ITS SECRETARY T.N.MADHUSOODANAN. BY ADVS. DR.K.P.PRADEEP SMT.T.THASMI RESPONDENT/S: 1 THE CENTRAL BOARD OF DIRECT TAXES DEPARTMENT OF REVENUE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NORTH BLOCK, NEW DELHI-110001, REPRESENTED BY ITS CHAIRMAN. 2 INCOME TAX OFFICER, WARD 1 AND TPS, KANNUR, AAYAKAR BHAVAN, OFFICE OF ADDITIONAL /JOINT CIT, KONNOTHUMCHAL, CHOVVA P.O., KANNUR-670006. 3 COMMISSIONER OF INCOME TAX (APPEALS), KOZHIKODE AAYAKAR BHAVAN, INCOME TAX OFFICE, MANANCHIRA, KOZHIKODE-673001. OTHER PRESENT: SC: CHRISTOPHER ABRAHAM THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 21.07.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.8934 OF 2020(N) 2

JUDGMENT Against Ext.P1 series of assessment orders under the Income Tax Act,('The Act' for short) the petitioner has preferred Ext.P2 series of appeals and Ext.P4 stay petition before the 3rd respondent.Exts.P3 series is the demand notices issued. It is the case of the petitioner that the issue involved in the appeal pertains to the permissibility of deduction under Section 80P of the Act in its applicability to Co-operative Societies. It is pointed that in similar matters this Court has already disposed the writ petition by directing the appellate authority to consider and pass orders in the appeal and keep in abeyance the recovery proceedings pursuant to the assessment orders in the meanwhile. Taking note of the said submission, and finding that this Court has in similar matters directed the appellate authority to pass orders in the appeal, and to keep in abeyance the recovery proceedings in the meanwhile, the writ petition is disposed by directing the 3rd respondent to consider and pass orders on Ext.P2 series of appeals, within a period of six months from the date of receipt of a copy of this judgment, after hearing the petitioner. Recovery steps for recovery of amounts confirmed against the petitioner by the assessment orders in question, and in particular pursuant to Exts.P3 series of demand notices, shall be kept in abeyance till such time as orders are passed by the appellate authority as directed above and the orders communicated to the petitioner. A.K.JAYASANKARAN NAMBIAR JUDGE SJ

WP(C).No.8934 OF 2020(N) 3

Appendix — schedule of exhibits
APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 TRUE COPY OF THE ASSESSMENT ORDER NO.AAAAT9657M DATED 19.01.2016 ISSUED FOR THE YEAR 2013-14 BY THE 2ND RESPONDENT. EXHIBIT P1(A) TRUE COPY OF THE ASSESSMENT ORDER NO.AAAAT9657M DATED 20.12.2016 ISSUED FOR THE YEAR 2014-15 BY THE 2ND RESPONDENT. EXHIBIT P1(B) TRUE COPY OF THE ASSESSMENT ORDER NO.AAAAT9657M DATED 19.12.2017 ISSUED FOR THE YEAR 2015-16 BY THE 2ND RESPONDENT. EXHIBIT P1(C) TRUE COPY OF THE ASSESSMENT ORDER NO.AAAAT9657M DATED 12.12.2019 ISSUED FOR THE YEAR 2017-18 BY THE 2ND RESPONDENT. EXHIBIT P2 TRUE COPY OF THE APPEAL DATED 23.04.2016 FILED BEFORE THE 3RD RESPONDENT FOR THE ASSESSMENT YEAR 2013-14. EXHIBIT P2(A) TRUE COPY OF THE APPEAL DATED 26.01.2017 FILED BEFORE THE 3RD RESPONDENT FOR THE ASSESSMENT YEAR 2014-15. EXHIBIT P2(B) TRUE COPY OF THE APPEAL DATED 11.03.2018 FILED BEFORE THE 3RD RESPONDENT FOR THE ASSESSMENT YEAR 2015-16. EXHIBIT P2(C) TRUE COPY OF THE APPEAL DATED 18.01.2020 FILED BEFORE THE 3RD RESPONDENT FOR THE ASSESSMENT YEAR 2017-18. EXHIBIT P3 TRUE COPY OF THE DEMAND NOTICE NO.PAN AAAAT79657M/2013-14 DATED 19.1.2016 FOR THE YEAR 2013-14 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P3(A) TRUE COPY OF THE DEMAND NOTICE NO.PAN AAAAT79657M/2014-15 DATED 20.12.2016 FOR THE YEAR 2014-15 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P3(B) TRUE COPY OF THE DEMAND NOTICE NO.PAN AAAAT79657M/2015-16 DATED 19.12.2017 FOR THE YEAR 2015-16 ISSUED BY THE 2ND WP(C).No.8934 OF 2020(N) 4 RESPONDENT. EXHIBIT P3(C) TRUE COPY OF THE DEMAND NOTICE NO.PAN AAAAT79657M/2017-18 DATED 12.12.2019 FOR THE YEAR 2017-18 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P4 TRUE COPY OF THE STAY APPLICATION FILED ON 14.03.2020 BEFORE THE 3RD RESPONDENT IN EXT.P2 SERIES OF APPEAL.

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