THE VATTANATHRA SERVICE CO-OP. BANK LIMITED vs. THE ADDITIONAL COMMISSIONER OF INCOME TAX

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WP(C)/26481/2021HC KeralaKLHC01066560202125 November 2021Author: HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS5 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala did not decide the substantive issues of the appeal on merits. Instead, the Court noted that the petitioner had already preferred an appeal (Ext.P2) before the Commissioner of Income Tax (Appeals) (the 3rd respondent), which was pending. Therefore, the Court deemed it appropriate to dispose of the writ petition by directing the Appellate Authority to consider the pending appeal in a time-bound manner. The Court directed the 3rd respondent to consider and pass appropriate orders on Ext.P2 as expeditiously as possible. Additionally, the Court ordered that no coercive steps shall be initiated against the petitioner pursuant to the assessment order (Ext.P1) until the disposal of the appeal. No issue was expressly left undecided, as the Court deferred the decision on the merits to the appellate authority.

What were the facts?

The petitioner, The Vattanathra Service Co-op. Bank Limited, is a Primary Agricultural Credit Society. The Assessing Officer (AO) passed an assessment order on September 16, 2021, rejecting the petitioner's claim for deduction under Section 80P. The AO's reasoning was that the petitioner did not satisfy the ingredients of a Primary Agricultural Credit Society as per the Kerala Co-operative Societies Act. The petitioner filed an appeal before the Commissioner of Income Tax (Appeals) (the 3rd respondent), challenging the assessment order. The petitioner argued that the AO 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? (Question of law and fact, concerning Section 80P). Assessee's Contentions: - The Assessing Officer failed to consider the Supreme Court judgment in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax, despite the assessment order being passed after the Supreme Court's decision. Revenue's Contentions: - The judgment records no specific contentions from the revenue regarding this issue.

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 25TH DAY OF NOVEMBER 2021/4TH AGRAHAYANA,1943 WP(C) NO. 26481 OF 2021 PETITIONER: THE VATTANATHRA SERVICE CO-OP. BANK LIMITED NO.499, P.O.VATTANATHRA, ALAGAPPANAGAR, THRISSUR-680302, REPRESENTED BY ITS SECRETARY, MINI K.R. BY ADVS. SRI.HARISANKAR V. MENON SMT.MEERA V.MENON RESPONDENTS: 1 THE ADDITIONAL/JOINT/DEPUTY/ ASST.COMMISSIONER OF INCOME TAX NATIONAL e-ASSESSMENT CENTRE, DELHI-110001. 2 NATIONAL FACELESS APPEAL CENTRE DELHI-110001, REPRESENTED BY THE PRINCIPAL CHIEF COMMISSIONER. 3 THE COMMISSIONER OF INCOME TAX(APPEALS) AYAKAR BHAVAN, SAKTHAN THAMPURAN NAGAR, THRISSUR-680001. 4 THE INCOME TAX OFFICER WARD 2(5), INCOME TAX OFFICE, AYAKAR BHAVAN, SAKTHAN THAMPURAM NAGAR, THRISSUR-680001. 5 THE PRINCIPAL COMMISSIONER OF INCOME TAX INCOME TAX OFFICE, AYAKAR BHAVAN, MANANCHIRA, KOZHIKODE-673001. W.P.(C) No.26481/21 -:2:- ADV.JOSE JOSEPH, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 25.11.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) No.26481/21 -:3:- BECHU KURIAN THOMAS, J. ----------------------------------------- W.P.(C) No.26481 of 2021 ---------------------------------------- Dated this the 25th day of November, 2021

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 16.09.2021. 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 Court Judgment.

3.

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.

4.

Accordingly, there will be a direction to the 3rd respondent to consider and pass appropriate orders on Ext.P2, 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 vps

Appendix — schedule of exhibits
APPENDIX OF WP(C) 26481/2021 PETITIONER'S/S' EXHIBITS Exhibit P1 COPY OF ASSESSMENT ORDER ISSUED BY THE 1ST RESPONDENT FOR THE YEAR 2018-19. Exhibit P2 COPY OF APPEAL FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT. Exhibit P3 COPY OF STAY PETITION FILED BY THE PETITIONER BEFORE THE 4TH RESPONDENT. Exhibit P4 COPY OF STAY PETITION FILED BY THE PETITIONER BEFORE THE 5TH RESPONDENT. Exhibit P5 COPY OF LETTER ISSUED BY THE INCOME TAX OFFICER WARD 2(1), THRISSUR. Exhibit P6 COPY OF JUDGMENT OF THIS HON'BLE COURT IN WPC NO.21200/2021.

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