KUZHUR SERVICE CO-OPERATIVE BANK LIMITED vs. INCOME TAX OFFICER,
What did the High Court hold?
The High Court of Kerala, in a writ petition, did not decide the merits of the assessment order or the appeal. Instead, the Court deemed it fit to dispose of the writ petition by directing the Appellate Authority (3rd respondent) to consider the appeal filed by the petitioner. The Court ordered the 3rd respondent to dispose of the appeal expeditiously, within a period of six months from the date of receipt of the judgment, after granting an opportunity of hearing to the petitioner. Furthermore, the Court directed that all coercive proceedings against the petitioner pursuant to the assessment order (Ext.P1) shall be kept in abeyance until the appeal is decided. The principle derived is that when an appeal is pending and a writ petition is filed raising grievances that could be addressed in appeal, the High Court may direct the appellate authority to decide the appeal expeditiously while staying coercive steps.
What were the facts?
The petitioner, Kuzhur Service Co-operative Bank Limited, a Primary Agricultural Credit Society, received an assessment order dated 29.03.2022 from the Income Tax Officer. The assessing officer rejected the petitioner's claim for deduction under Section 80P, stating that there was no evidence that the petitioner satisfied the ingredients of a Primary Agricultural Credit Society as defined under the Kerala Co-operative Societies Act. The petitioner subsequently filed an appeal before the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi. In the appeal, the petitioner argued that the assessing officer failed to consider the Supreme Court's judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax, which was delivered prior to the assessment order.
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 contended 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 relied on this judgment to support its claim for deduction under Section 80P. Revenue's contentions: The judgment does not record any specific contentions made by the revenue in response to the petitioner's arguments regarding the Supreme Court's judgment or the rejection of the Section 80P deduction.
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 29.03.2022. 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 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 petitioner has already preferred an appeal as -3- W.P.(C) NO.16581 OF 2022 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 dispose of Ext.P2 appeal, as expeditiously as possible, at any rate, within a period of six months from the date of receipt of a copy of this judgment, after granting an opportunity of hearing to the petitioner. Till then, all coercive proceedings against the petitioner pursuant to Ext.P1 shall be kept in abeyance. BECHU KURIAN THOMAS JUDGE bpr
-4- W.P.(C) NO.16581 OF 2022
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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