THE KODAKARA FARMERS SERVICE CO-OPERATIVE BANK LTD.NO.R761 vs. THE ADDITIONAL/JOINT/DEPUTY/ASST. COMMISSIONER OF INCOME TAX/

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WP(C)/11911/2021HC KeralaKLHC01032467202108 June 2021Author: HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala did not decide the substantive issue regarding the eligibility of the petitioner for deduction under Section 80P(2)(a)(i). Instead, the Court directed the 2nd respondent (National Faceless Appeal Centre, Delhi) to consider and dispose of the stay petition (Ext.P3(a)) filed along with the statutory appeal within a period of four months from the date of receipt of a copy of the judgment. Pending the disposal of the stay petition, all coercive action pursuant to the assessment order (Ext.P1) was ordered to be kept in abeyance. The petitioner was directed to furnish a copy of the judgment to the 2nd respondent for appropriate action. The writ petition was disposed of with these directions.

What were the facts?

The petitioner, The Kodakara Farmers Service Co-operative Bank Ltd., a co-operative society providing credit facilities to its members, claimed a deduction under Section 80P(2)(a)(i) of the Income Tax Act, 1961. This claim was rejected by the Assessing Officer through an order of assessment (Ext.P1). The petitioner challenged this order by filing a statutory appeal before the National Faceless Appeal Centre (NFAC), Delhi (the 2nd respondent). Along with the appeal, a stay petition (Ext.P3(a)) was also filed. The present writ petition was filed by the petitioner challenging the assessment order and seeking directions regarding the appeal and stay petition.

What were the issues?

1. Whether the petitioner, a co-operative society, is entitled to the deduction under Section 80P(2)(a)(i) of the Income Tax Act, 1961, for its income from providing credit facilities to its members? The petitioner argued that it is a co-operative society engaged in the business of providing credit facilities to its members and is therefore eligible for the deduction under Section 80P(2)(a)(i). The revenue, through the Assessing Officer, rejected this claim in the order of assessment (Ext.P1). While the core issue of eligibility for Section 80P deduction was the subject of the appeal before the NFAC, the present writ petition primarily focused on the procedural aspect of the appeal and the pending stay petition.

Which sections of the Income-tax Act were involved?

Section 80P(2)(a)(i)

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 8TH DAY OF JUNE 2021 / 18TH JYAISHTA, 1943 WP(C) NO. 11911 OF 2021 PETITIONER/S: THE KODAKARA FARMERS SERVICE CO-OPERATIVE BANK LTD.NO.R761 KODAKARA, THRISSUR - 680684, REPRESENTED BY ITS MANAGING DIRECTOR, V.D.BIJU BY ADVS. HARISANKAR V. MENON MEERA V.MENON RESPONDENT/S: THE ADDL./JOINT/DEPUTY/ASST. COMMISSIONER OF INCOME TAX/INCOME TAX OFFICER, NATIONAL e-ASSESSMENT CENTRE, DELHI - 110001 NATIONAL FACELESS APPEAL CENTRE, DELHI - 110001, REPRESENTED BY THE PRINCIPAL CHIEF COMMISSIONER. THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08.06.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 11911 OF 2021 -2-

JUDGMENT Petitioner is a Co-operative Society allegedly carrying on the business of providing credit facilities to its members. Petitioner has claimed the benefit under Section 80P (2)(a)(i) of the Income Tax Act, 1961. By Ext.P1 order of assessment, the claim for deduction under Section 80P was rejected. Challenging Ext.P1, an appeal has been preferred before the 2nd respondent. A stay petition has also been preferred by the Petitioner as is evident from Ext.P3(a).

2.

I have heard the learned Counsel for the petitioner as well as the learned Standing Counsel, who took notice on behalf of the department.

3.

Considering the nature of the issues involved and the arguments advanced, I am of the view that this writ petition itself can be disposed of by directing consideration of the stay petition filed along with the statutory appeal.

4.

Accordingly, there will be a direction to the 2nd respondent to dispose of the stay petition Ext.P3(a) filed along with the statutory appeal preferred

WP(C) NO. 11911 OF 2021 -3- by the Petitioner. The stay petition shall be considered and disposed of within a period of four months from the date of receipt of a copy of this judgment. All coercive action pursuant to Ext.P1 shall be kept in abeyance till the disposal of the stay petition. Petitioner shall furnish a copy of this judgment to the 2nd respondent for appropriate action. The writ petition is disposed of as above. BECHU KURIAN THOMAS JUDGE uu 08.06.2021

WP(C) NO. 11911 OF 2021 -4-

Appendix — schedule of exhibits
APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 COPY OF ASSESSMENT ORDER ISSUED BY THE 1ST RESPONDENT FOR THE YEAR 2018-19 EXHIBIT P2 COPY OF THE S.O.NO.3296(E) ISSUED BY THE MINISTRY OF FINANCE, NEW DELHI EXHIBIT P2(a) COPY OF THE SO.ONO.3297(E) ISSUED BY THE MINISTRY OF FINANCE, NEW DELHI EXHIBIT P3 EXHIBIT P3(a) EXHIBIT P4 COPY OF THE APPEAL FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT COPY OF STAY PETITION FILED BY THE PETITIONER BEFORE THE ADDITIONAL/JOINT/ASSISTANT COMMISSIONER OF INCOME TAX, COMMISSIONER OF INCOME TAX (APPEALS), NATIONAL FACELESS APPEAL CENTRE, DELHI COPY OF THE JUDGMENT OF THIS HON'BLE COURT IN WP(C) NO.5849/2021.

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