MADHAVA VILASOM SERVICE CO-OPERATIVE BANK LTD.NO.1347 vs. THE INCOME TAX OFFICER

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WP(C)/19756/2021HC KeralaKLHC01051409202123 September 2021Author: HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS5 pages
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What did the High Court hold?

The High Court directed the 2nd and 3rd respondents (Commissioner of Income Tax (Appeals)) to take up the stay petition (Ext.P4) filed along with the appeal (Ext.P3) and consider it, passing appropriate orders within two months from the date of receipt of a certified copy of the judgment. Furthermore, the Court ordered that all coercive proceedings initiated pursuant to the penalty order (Ext.P2) shall be kept in abeyance until such orders on the stay petition are passed. The Court found that directing the disposal of the stay petition in a time-bound manner was appropriate given the circumstances. No specific issue regarding the merits of the penalty or appeal was decided.

What were the facts?

The petitioner, Madhava Vilasom Service Co-operative Bank Ltd. No. 1347, is a Primary Agricultural Credit Society. It is aggrieved by Ext.P2, a penalty order issued under Section 271B of the Income Tax Act. The petitioner filed an appeal (Ext.P3) and a stay petition (Ext.P4) before the 2nd respondent, the Commissioner of Income Tax (Appeals). The petitioner apprehended that coercive proceedings might be initiated before the stay petition was considered, rendering the appeal infructuous. Therefore, the petitioner approached the High Court seeking a direction for the early consideration of their stay petition.

What were the issues?

1. Whether the petitioner is entitled to a direction for the early disposal of their stay petition filed before the Commissioner of Income Tax (Appeals)? (Question of procedure) Assessee's Contention: The petitioner argued that they are aggrieved by a penalty order under Section 271B and have filed an appeal and stay petition. They apprehended that coercive proceedings would be initiated before the stay petition is heard, making the appeal infructuous. They sought a direction for the early consideration of the stay petition. Revenue's Contention: The learned Standing Counsel for the respondents was heard. No specific arguments or reliance on authorities were recorded in the judgment for the revenue regarding the disposal of the stay petition.

Which sections of the Income-tax Act were involved?

Section 271B

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 23RD DAY OF SEPTEMBER 2021 / 1ST ASWINA, 1943 WP(C) NO. 19756 OF 2021 PETITIONER: MADHAVA VILASOM SERVICE CO-OPERATIVE BANK LTD.NO.1347 REPRESENTED BY ITS SECRETARY, ARASUMOODU, KULATHOOR P.O, THIRUVANANTHAPURAM DISTRICT BY ADVS.T.R.HARIKUMAR ARJUN RAGHAVAN RESPONDENTS: 1 THE INCOME TAX OFFICER WARD -2(1), OFFICE OF THE ADDITIONAL COMMISSIONER OF INCOME TAX, AAYAKAR BHAVAN, KAWDIAR P.O, THHIRUVANANTHAPURAM PIN 695 003 2 THE COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEAL CENTRE, NORTH BLOCK, DELHI 110 001 3 THE COMMISSIONER OF INCOME TAX(APPEALS) NATIONAL FACELESS APPEAL CENTRE, NORTH BLOCK, DELHI 110 001 4 THE KERALA STATE CO-OPERATIVE BANK LTD. (FORMERLY KNOWN AS THIRUVANANTHAPURAM DISTRICT CO-OPERATIVE BANK) KULATHOOR BRANCH, KULATHOOR, THIRUVANANTHAPURAM PIN 695 583 REPRESENTED BY ITS BRANCH MANAGER. OTHER PRESENT: R4 – ADV.THOMAS ABRAHAM, SC. ADV.CHRISTOPHER ABRAHAM, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 23.09.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 19756 OF 2021 2 BECHU KURIAN THOMAS, J =========================== W.P.(C) No.19756 of 2021 --------------------------------- Dated this the 23rd day of September, 2021

JUDGMENT Petitioner is a Primary Agricultural Credit Society, registered under the Kerala Co-operative Societies Act, 1969. Being aggrieved by Ext.P2 penalty order issued under Section 271 B of the Income Tax Act, petitioner preferred Ext.P3 appeal before the 2nd respondent along with Ext.P4 stay petition. It is submitted that the appeal as well as the stay petitions are pending consideration before the 2 nd respondent.

2.

Learned counsel for the petitioner apprehends that before the stay petition is taken up for consideration, coercive proceedings will be carried out thereby rendering the appeal itself as infructuous. Petitioner,

WP(C) NO. 19756 OF 2021 3 therefore, seeks for a direction for early consideration of his stay petition.

3.

I have heard Adv.T.R.Harikumar, the learned counsel for the petitioner as well as Adv.Christopher Abraham, the learned Standing Counsel for the respondents.

4.

Having regard to the submissions made by the learned counsel for the petitioner as well as the learned counsel for the respondents and on account of the circumstances arising in the case, I am of the view that the 2nd and 3rd respondent, as the case may be, can be directed to dispose of Ext.P4 stay petition in a time bound manner.

5.

Accordingly, there will be a direction to respondents 2 and 3, as the case may be, to take up Ext.P4 stay petition filed along with Ext.P3 appeal and consider the same and pass appropriate orders within a period of two months from the date of receipt of a certified

WP(C) NO. 19756 OF 2021 4 copy of this judgment.

6.

Till such orders are passed, all coercive proceedings initiated pursuant to Ext.P2 order shall be kept in abeyance. The writ petition is disposed of as above. BECHU KURIAN THOMAS, JUDGE AMV/23/09//2021

WP(C) NO. 19756 OF 2021 5

Appendix — schedule of exhibits
APPENDIX OF WP(C) 19756/2021 PETITIONER EXHIBITS Exhibit P1 A TRUE COPY OF THE JUDGEMENT DATED 25-02-2020 IN WP(C) NO. 5259 OF 2020 Exhibit P2 A TRUE COPY OF THE PENALTY ORDER DATED 26-04-2019 AND NUMBERED AS ITBA/PNL/F/271B/19- 20/1015813400(1) ALONG WITH DEMAND NOTICE ISSUED UNDER SECTION 156,FOR THE ASSESSMENT YEAR 2016- 2017, BY THE 1ST RESPONDENT Exhibit P3 A TRUE COPY OF ONLINE APPEAL DATED 01-05-2019 PREFERRED BY THE PETITIONER BEFORE THE 2ND RESPONDENT Exhibit P4 A TRUE COPY OF STAY PETITION DATED 01-05-2019 PREFERRED BY THE PETITIONER IN EXT-P3 APPEAL Exhibit P5 A TRUE COPY OF THE APPLICATION DATED 21-08-2021 SUBMITTED BY THE PETITIONER. Exhibit P6 A TRUE COPY OF THE COMMUNICATION DATED 25-08-2021 AND NUMBERED AS ITBA/RCV/F/17/2021- 22/1035086318(1) ISSUED BY THE 1ST RESPONDENT. Exhibit P7 A TRUE COPY JUDGMENT DATED 08-07-2019 IN WP(C) NO. 18484 OF 2019 RESPONDENTS EXHIBITS : NIL TRUE COPY P.A.TO JUDGE

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