INCHAKUNDU SERVICE CO-OPERATIVE BANK LIMITED vs. INCOME TAX OFFICER
What did the High Court hold?
The High Court of Kerala noted that the petitioner had already preferred an appeal against the assessment order before the Commissioner of Income Tax (Appeals) and that this appeal was pending. Consequently, the Court deemed it appropriate to dispose of the writ petition by directing the Appellate Authority to consider the appeal in a time-bound manner. The Court directed the 3rd respondent (Commissioner of Income Tax (Appeals)) to consider and pass appropriate orders on the appeal (Ext.P2) expeditiously, within a period of six months. Furthermore, the Court ordered that no coercive steps would be initiated pursuant to the assessment order (Ext.P1) until the disposal of the appeal. The issue of whether the AO erred in rejecting the deduction under Section 80P was not decided on merits by the High Court, but was remitted to the appellate authority.
What were the facts?
The petitioner, Inchakundu Service Co-operative Bank Limited, is a Primary Agricultural Credit Society. The Assessing Officer (AO) passed an assessment order dated March 30, 2022, rejecting the petitioner's claim for deduction under Section 80P. The AO's reasoning was that the petitioner did not provide evidence to satisfy the ingredients of a Primary Agricultural Credit Society as defined under the Kerala Co-operative Societies Act. The petitioner filed an appeal against this assessment order before the Commissioner of Income Tax (Appeals). The petitioner argued that the AO failed to consider the Supreme Court's judgment in Mavilayi Service Co-operative Bank and Others v. Commissioner of Income Tax, Calicut and Others, despite the assessment order being passed after this judgment.
What were the issues?
1. Whether the Assessing Officer erred in rejecting the petitioner's claim for deduction under Section 80P by failing to consider the Supreme Court's judgment in Mavilayi Service Co-operative Bank and Others v. Commissioner of Income Tax, Calicut and Others, when the assessment order was passed subsequent to this judgment? (Question of law and fact, turning on Section 80P of the Income Tax Act, 1961). Assessee's Contentions: The petitioner argued that the AO did not consider the binding Supreme Court judgment in Mavilayi Service Co-operative Bank and Others v. Commissioner of Income Tax, Calicut and Others, which was rendered prior to the assessment order. The petitioner relied on this Supreme Court judgment. Revenue's Contentions: The judgment records no argument for the revenue.
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.P1 order of assessment was issued against the petitioner on 30.03.2022. 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 3rd respondent, petitioner has sought to canvass that the judgment of the Supreme Court in Mavilayi Service Co-operative Bank and Others v. Commissioner of Income Tax, Calicut and Others [2021 (1) KLT 485] was not considered by the Assessing Officer, though the WP(C) NO. 16572 OF 2022 3 assessment order was rendered subsequent to the Supreme Court Judgment.
Since the petitioner has already preferred an appeal as Ext.P2 and the same is pending consideration before the 3rd 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.
Accordingly, there will be a direction to the 3rd respondent to consider and pass appropriate orders on Ext.P2, as expeditiously as possible, within a period of six months.
Till the disposal of the appeal, no coercive steps shall be initiated pursuant to Ext.P1 assessment order. The writ petition is disposed of as above. BECHU KURIAN THOMAS JUDGE ssa/
WP(C) NO. 16572 OF 2022 4
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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