PATTOM SERVICE CO-OPERATIVE BANK LTD NO T-1318 vs. THE CENTRAL BOARD OF DIRECT TAXES

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WP(C)/29807/2021HC KeralaKLHC01074022202121 December 2021Author: HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS5 pages
AI SummaryRemanded

What did the High Court hold?

The High Court did not decide the merits of the case. Instead, it noted that the petitioner had already preferred an appeal (Ext.P3) before the third respondent, the Commissioner of Income Tax (Appeals), which was pending consideration. Therefore, 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 third respondent to consider and pass appropriate orders on Ext.P3 as expeditiously as possible. Furthermore, the Court ordered that no coercive steps shall be initiated against the petitioner pursuant to the assessment order (Ext.P2) until the disposal of the appeal. The issue regarding the applicability of the Supreme Court judgment and the validity of the Section 80P deduction was expressly left undecided by the High Court, as it was to be adjudicated by the appellate authority.

What were the facts?

The petitioner, Pattom Service Co-operative Bank Ltd. No. T-1318, is a Primary Agricultural Credit Society. The Assessing Officer issued an assessment order on September 30, 2021, rejecting the petitioner's claim for deduction under Section 80P. The reason for rejection was the alleged lack of evidence that the petitioner satisfied the ingredients of a Primary Agricultural Credit Society as defined under the Kerala Co-operative Societies Act. The petitioner challenged this assessment order before the Commissioner of Income Tax (Appeals), the third respondent. The petitioner argued that the Supreme Court judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax, which was rendered prior to the assessment order, was not considered by the Assessing Officer.

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? (Question of law and fact, concerning Section 80P). Assessee's Contention: The petitioner argued that the Assessing Officer failed to consider the binding Supreme Court judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax, despite the assessment order being passed subsequent to this judgment. The petitioner contended that this judgment should have been applied to their case. Revenue's Contention: The judgment does not record any specific contentions made by the revenue regarding this issue. It only notes that the petitioner's appeal is pending before the appellate authority.

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 TUESDAY, THE 21ST DAY OF DECEMBER 2021/30TH AGRAHAYANA, 1943 WP(C) NO. 29807 OF 2021 PETITIONER: PATTOM SERVICE CO-OPERATIVE BANK LTD NO T-1318 MEDICAL COLLEGE, KANNAMMOOLA P.O., TRIVANDRUM - 695 011 REPRESENTED BY ITS SECRETARY SREEJI S. BY ADVS. SRI.K.P.PRADEEP SRI.HAREESH M.R. SMT.RASMI NAIR T. SRI.T.T.BIJU SMT.T.THASMI SMT.M.J.ANOOPA RESPONDENTS: 1 THE CENTRAL BOARD OF DIRECT TAXES DEPARTMENT OF REVENUE, MINISTRY OF FINANCE GOVERNMENT OF INDIA, NORTH BLOCK, NEW DELHI - 110 001, REPRESENTED BY ITS CHAIRMAN. 2 INCOME TAX OFFICER CIRCLE CENTRE, KOLLAM, INCOME TAX DEPARTMENT, AAYAKAR BHAVAN, INCOME TAX OFFICE, NEAR KARBALA JUNCTION, RAILWAY STATION ROAD, KOLLAM - 691 001. 3 COMMISSIONER OF INCOME TAX (APPEALS) THIRUVANANTHAPOURAM, AAYAKAR BHAVAN, INCOME TAX OFFICE, KOWADIAR, THIRUVANANTHAPURAM - 695 003. 4 ADDITIONAL COMMISSIONER OF INCOME TAX W.P.(C) No.29807/21 -:2:- NATIONAL E-ASSESSMENT CENTRE, DELHI ROOM NO.401, 2ND FLOOR, E-RAMP, JAWAHARLAL NEHRU STADIUM, DELHI - 110 003. BY ADV.CHRISTOPHER ABRAHAM, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 21.12.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) No.29807/21 -:3:- BECHU KURIAN THOMAS, J. ----------------------------------------- W.P.(C) No.29807 of 2021 ---------------------------------------- Dated this the 21st day of December, 2021

JUDGMENT Petitioner is a Primary Agricultural Credit Society registered under the Kerala Co-operative Societies Act, 1969. Ext.P2 order of assessment was issued against the petitioner on 30.09.2021. 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.

2.

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 Curt Judgment.

3.

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

4.

Accordingly, there will be a direction to the 3rd 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.P2 assessment order. The writ petition is disposed of as above. BECHU KURIAN THOMAS JUDGE vps

Appendix — schedule of exhibits
APPENDIX OF WP(C) 29807/2021 PETITIONER'S/S' EXHIBITS EXHIBIT P1 TRUE COPY OF THE RETURN OF INCOME DATED 31/07/2020 FOR THE ASSESSMENT YEAR 2019- 20 IN PAN AAEAP2030OQ FILED BY THE PETITIONER. EXHIBIT P2 TRUE COPY OF THE ASSESSMENT ORDER NO.ITBA/AST/S/143(3)/2021-22/1036064244 (1) DATED 30/09/2021 FOR THE ASSESSMENT YEAR 2019-20 ISSUED BY THE 2ND RESPONDENT TO THE PETITIONER. EXHIBIT P3 TRUE COPY OF THE APPEAL DATED 23/10/2021 FILED FOR THE YEAR 2019-20 BEFORE THE FIRST APPELLATE AUTHORITY BY THE PETITIONER. EXHIBIT P4 TRUE COPY OF THE DEMAND NOTICE NO.ITBA/AST/S/156/2021-22/1036064340(1) DATED 30/09/2021 ISSUED FOR THE YEAR 2019-20 BY THE 2ND RESPONDENT TO THE PETITIONER.

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