PONNEZHA SERVICE CO-OPERATIVE BANK LTD. vs. THE COMMISSIONER OF INCOME TAX (APPEALS)

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WP(C)/9090/2020HC KeralaKLHC01023155202006 August 2020Author: HONOURABLE DR. JUSTICE A.K.JAYASANKARAN NAMBIAR3 pages
AI SummaryRemanded

What did the High Court hold?

The High Court disposed of the writ petition by directing the 1st respondent (Commissioner of Income Tax (Appeals)) to consider and pass orders on the petitioner's appeal (Ext.P3) within an outer time limit of six months. The Court further directed that recovery steps for the amounts confirmed against the petitioner shall be kept in abeyance until such time as orders are passed by the 1st respondent and communicated to the petitioner. This decision was made in light of similar matters where the Court had directed the appellate authority to consider appeals and stayed recovery pending disposal. The specific finding on the disallowance of deduction under Section 80P was not addressed as the appeal was pending. The operative direction is to expedite the appeal and stay recovery.

What were the facts?

The petitioner, Ponnezha Service Co-operative Bank Ltd., filed an appeal (Ext.P3) against an assessment order (Ext.P2) passed under the Income Tax Act. The petitioner contends that recovery steps are being taken by the respondents for the amounts confirmed in the assessment order, even before the stay petition has been considered. The core issue in the appeal relates to the disallowance of a deduction claimed by the petitioner under Section 80P of the Income Tax Act. The assessment year(s) and the specific amount in dispute are not explicitly stated in the judgment. The procedural history involves the filing of an appeal and a subsequent writ petition seeking a stay on recovery proceedings.

What were the issues?

1. Whether the recovery steps for the amounts confirmed by the assessment order can be initiated before the disposal of the appeal and consideration of the stay petition, especially when the appeal concerns the disallowance of deduction under Section 80P of the Income Tax Act? Assessee's Contention: The petitioner argues that recovery steps are being pursued prematurely, even before the stay petition is considered, and that the appeal involves a significant issue regarding the disallowance of deduction under Section 80P. The petitioner relies on the principle that recovery should be stayed pending appeal. Revenue's Contention: The judgment does not record any specific contentions made by the revenue in response to the writ petition. However, the existence of recovery steps implies the revenue's position to recover the assessed demand.

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 A.K.JAYASANKARAN NAMBIAR THURSDAY, THE 06TH DAY OF AUGUST 2020 / 15TH SRAVANA, 1942 WP(C).No.9090 OF 2020(I) PETITIONER/S: PONNEZHA SERVICE CO-OPERATIVE BANK LTD. NO.3522, PONNEZHA THEKKEKKARA POST, MAVELIKARA, ALAPPUZHA-690526., REPRESENTED BY ITS SECRETARY IN CHARGE K.U.INDUKALA. BY ADV. SRI.V.DEVANANDA NARASIMHAM RESPONDENT/S: 1 THE COMMISSIONER OF INCOME TAX (APPEALS) PUBLIC LIBRARY BUILDING, SHASTRI ROAD, KOTTAYAM-686001, 2 THE INCOME TAX OFFICER, WARD -3, THIRUVALLA RANGE, T.K. ROAD, THIRUVALLA- 689101. OTHER PRESENT: SC: JOSE JOSEPH THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06.08.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.9090 OF 2020(I) 2

JUDGMENT Against Ext.P2 assessment order under the Income Tax Act, the petitioner has preferred Ext.P3 appeal before the 1st respondent. It is the case of the petitioner that even prior to considering the stay petition, recovery steps are taken by the respondents against the petitioner for recovery of the amounts confirmed by Ext.P2 assessment order. It is stated by the learned counsel for the petitioner that the issue involved in the appeal pertains to dis-allowance of deduction claimed under Section 80P of the Income Tax Act.

2.

I have heard the learned counsel appearing for the petitioner and also the learned Standing counsel appearing for the respondents.

On a consideration of the facts and circumstances of the case as also the submissions made across the Bar and taking note of the fact that in similar matters, this Court has directed the Appellate Authority to consider and pass orders in the appeal and stayed the recovery of disputed amounts pending disposal of the appeal, this Writ petition is disposed directing the 1st respondent to consider and pass orders on Ext.P3 appeal within an outer time limit of six months. Recovery steps for recovery of amounts confirmed against the petitioner shall be kept in abeyance till such time as orders are passed by the 1st respondent as directed above and the order communicated to the petitioner. A.K.JAYASANKARAN NAMBIAR

JUDGE SJ

WP(C).No.9090 OF 2020(I) 3

Appendix — schedule of exhibits
APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 TRUE COPY OF THE ACKNOWLEDGMENT GENERATED THOUGH INCOME TAX PORTAL ELECTRONICALLY ON 02.12.19 OF INCOME TAX RETURN FOR THE AY 2017-18 BY THE PETITIONER. EXHIBIT P2 TRUE COPY OF THE ASSESSMENT ORDER PASSED BY THE 2ND RESPONDENT ON 26.12.2019 FOR THE AY 2017-18 U/S. 144 OF THE INCOME TAX ACT FIXING TAXABLE INCOME OF RS.84,95,236/- EXHIBIT P3 TRUE COPY OF ONLINE APPEAL FOR THE AY 2017- 18 FILED U/S. 246A OF THE INCOME TAX ACT ON 23.01.20 AGAINST EXHIBIT P2 ASSESSMENT ORDER BEFORE THE 1ST RESPONDENT. EXHIBIT P4 TRUE COPY OF THE DEMAND NOTICE DATED 26.12.19 ISSUED BY 2ND RESPONDENT DEMANDING ASSESSMENT INCOME TAX FOR THE AY 2017-18 TO THE PETITIONER.

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