THURAVOOR SERVICE CO-OPERATIVE BANK LTD.NO.E-69 vs. THE INCOME TAX OFFICER

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WP(C)/29980/2021HC KeralaKLHC01074410202127 January 2022Author: HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala did not decide the merits of the case. Instead, it directed the second respondent, the Commissioner of Income Tax (Appeals), to consider and pass appropriate orders on the petitioner's appeal (Ext.P3) expeditiously. The Court acknowledged that the appeal was pending before the Appellate Authority. As an interim measure, the Court ordered that no coercive steps would be initiated against the petitioner pursuant to the assessment order (Ext.P1) until the disposal of the appeal. The primary focus was on procedural expediency rather than substantive legal determination at this stage.

What were the facts?

The petitioner, Thuravoor Service Co-operative Bank Ltd., a Primary Agricultural Credit Society, received an assessment order dated 27.12.2019 (Ext.P1). The Assessing Officer rejected the petitioner's claim for deduction under Section 80P, stating there was no evidence that the petitioner met the criteria for a Primary Agricultural Credit Society under the Co-operative Societies Act. The petitioner challenged this assessment order before the second respondent, the Commissioner of Income Tax (Appeals), by filing an appeal (Ext.P3). The petitioner argued that the Supreme Court judgment in Mavilayi Service Co-operative Bank and Others v. Commissioner of Income Tax, Calicut and Others [2021 (1) KLT 485] was applicable to their case. The writ petition was filed seeking a direction for the timely disposal of the pending appeal.

What were the issues?

1. Whether the petitioner, Thuravoor Service Co-operative Bank Ltd., qualifies as a Primary Agricultural Credit Society for the purpose of claiming deduction under Section 80P of the Income Tax Act, 1961, based on the evidence presented. Assessee's Contentions: The petitioner contended that the Supreme Court's judgment in Mavilayi Service Co-operative Bank and Others v. Commissioner of Income Tax, Calicut and Others [2021 (1) KLT 485] governs the factual situation and supports their claim for deduction under Section 80P. Revenue's Contentions: The judgment does not record any specific contentions made by the revenue in this writ petition. The assessment order indicates the revenue's stance was that the petitioner failed to provide evidence to satisfy the ingredients of a Primary Agricultural Credit Society.

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 THURSDAY, THE 27TH DAY OF JANUARY 2022 / 7TH MAGHA, 1943 WP(C) NO. 29980 OF 2021 PETITIONER: THURAVOOR SERVICE CO-OPERATIVE BANK LTD.NO.E-69 THURAVOOR P.O., ANGAMALI, ERNAKULAM-683572, REPRESENTED BY ITS SECRETARY. BY ADV C.A.JOJO RESPONDENTS: 1 THE INCOME TAX OFFICER WARD-(3), ALUVA P.O., R.S.ROAD, KOCHI-683101. 2 COMMISSIONER OF INCOME TAX (APPEALS), NATIONAL FACELESS APPEAL CENTRE, NEW DELHI-110001. 3 COMMISSIONER OF INCOME TAX (APPEALS)-2, OFFICE OF THE COMMISSIONER OF INCOME TAX, CENTRAL REVENUE TOWER, KOCHI-682018. 4 THE PRINCIPAL COMMISSIONER OF CENTRAL TAX C.R.BUILDING, I.S.PRESS ROAD, ERNAKULAM-682018. ADV.JOSE JOSEPH, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 27.01.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 29980 OF 2021 2 BECHU KURIAN THOMAS, J ======================= W.P.(C) No. 29980 of 2021 ------------------------------- Dated this the 27 th day of January, 2022

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 27.12.2019. 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 Co-operative Societies Act.

2.

While assailing the assessment order before the 2 nd 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] governs the factual situation arising in the case.

3.

Since the petitioner has already preferred an appeal as Ext.P3

WP(C) NO. 29980 OF 2021 3 and the same is pending consideration before the 2 nd 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.

4.

Accordingly, there will be a direction to the 2 nd respondent to consider and pass appropriate orders on Ext.P3, as expeditiously as possible.

5.

Till the disposal of the appeal, no coercive steps shall be initiated against the petitioner, pursuant to Ext.P1 assessment order. The writ petition is disposed of as above. BECHU KURIAN THOMAS, JUDGE AMV/27/01/2022

WP(C) NO. 29980 OF 2021 4

Appendix — schedule of exhibits
APPENDIX OF WP(C) 29980/2021 PETITIONER EXHIBITS Exhibit P1 A TRUE COPY OF THE ASSESSMENT ORDER AY 2017-18 DATED 27.12.2019 ISSUED BY THE FIRST RESPONDENT. Exhibit P2 A TRUE COPY OF THE DEMAND NOTICE FOR AN AMOUNT OF RS.1,41,48,781/-U/S 156 DATED 27.12.2019 ISSUED BY THE FIRST RESPONDENT. Exhibit P3 A TRUE COPY OF THE APPEAL FOR AY 2017-18 BEFORE THE 2ND RESPONDENT DATED 14.01.2020. Exhibit P4 A TRUE COPY OF THE STAY PETITION FOR AY 2017-18 BEFORE THE 1ST RESPONDENT U/S 220(6) OF THE I.T ACT 1961 DATED 14.01.2020. Exhibit P5 A TRUE COPY OF THE DEMAND NOTICE FOR PAYMENT OF 20% DATED 24.03.2019 BY THE 1ST RESPONDENT. Exhibit P6 A TRUE COPY OF THE DEMAND LETTER FOR PAYMENT OF 20% OF TAX FOR AN AMOUNT OF RS.7,50,000/- DATED 17.12.2021 ISSUED BY THE FIRST RESPONDENT. Exhibit P7 A TRUE COPY OF THE JUDGMENT IN WP(C)NO.21112 OF 2021 DATED 05.10.2021. RESPONDENTS EXHIBITS : NIL TRUE COPY

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