THE AYYANTHOLE SERVICE CO-OPERATIVE BANK NO. R.494, vs. THE COMMISSIONER OF INCOME TAX (APPEALS),

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WP(C)/9232/2020HC KeralaKLHC01023565202023 March 2020Author: HONOURABLE MR.JUSTICE K.VINOD CHANDRAN3 pages
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What did the High Court hold?

The High Court held that recovery proceedings should be stayed until the appeal is disposed of by the first appellate authority. The Court's reasoning was based on the pendency of the appeal and stay petition before the Commissioner of Income Tax (Appeals). The Court explicitly stated that the disposal of the writ petition was made without any observation on the merits of the matter. The operative direction was to stay the recovery of the demand until the appeal is decided. No issue was left undecided; the Court addressed the immediate concern of recovery pending appeal.

What were the facts?

The petitioner, The Ayyanthole Service Co-operative Bank, filed a writ petition challenging recovery proceedings initiated by the respondents, the Commissioner of Income Tax (Appeals) and the Income Tax Officer. The dispute pertains to the assessment year 2012-13 and concerns the petitioner's eligibility for deduction under Section 80P of the Income Tax Act, 1961. An appeal and a stay petition were pending before the first appellate authority. The High Court was considering the petition for admission.

What were the issues?

1. Whether recovery proceedings can be initiated while an appeal and stay petition are pending before the first appellate authority, concerning the eligibility of the petitioner for deduction under Section 80P of the Income Tax Act, 1961? Assessee's Contention: The assessee implicitly argued for a stay of recovery proceedings, as evidenced by the filing of the writ petition challenging the recovery while an appeal and stay petition were pending. The assessee relied on the Full Bench decision in Mavilayil Service Co-operative Bank Limited v. Commissioner of Income Tax, Calicut [2019 (2) KHC 287 (FB)] for the underlying issue of Section 80P eligibility. Revenue's Contention: The judgment does not record any specific arguments made by the revenue in response to the writ petition.

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 K.VINOD CHANDRAN MONDAY, THE 23RD DAY OF MARCH 2020 / 3RD CHAITHRA, 1942 WP(C).No.9232 OF 2020 PETITIONER/S: THE AYYANTHOLE SERVICE CO-OPERATIVE BANK NO. R.494, AYYANTHOLE P.O., THRISSUR - 680 003, REPRESENTED BY ITS SECRETARY. BY ADV. SRI.P.C.SASIDHARAN RESPONDENT/S: 1 THE COMMISSIONER OF INCOME TAX (APPEALS), AAYAKAR BHAVAN, S.T.NAGAR, THRISSUR. 2 THE INCOME TAX OFFICER, WARD 2(1), THRISSUR RANGE-2, OFFICE OF THE INCOME TAX OFFICER, SAKTHANTHAMPOURAM NAGAR, THRISSUR - 680 001. OTHER PRESENT: R1 & R2 BY SRI.JOSE JOSEPH, SC, IT THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 23.03.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).9232 of 2020 - 2 - K. Vinod Chandran, J. -------------------------- W.P(C) No.9232 of 2020 -------------------------- Dated this the 23rd day of March, 2020

JUDGMENT The writ petition is against the recovery initiated while an appeal is pending. The issue is also with respect to the coverage of the petitioner under Section 80P of the Income Tax Act, 1961, which has to be adjudicated on the basis of the Full Bench decision in Mavilayil Service Co

- operative Bank Limited v. Commissioner of Income Tax, Calicut [2019 (2) KHC 287 (FB)].

2.

In the present case, the demand is with respect to assessment year 2012-13. Exhibit P3 appeal along with Exhibit P4 stay petition are pending before the first appellate authority. In the circumstance of the case, I am of the opinion that there shall be a stay of recovery till

the appeal is disposed of. The writ petition is disposed of with the above direction, without any observation on the merits of the matter. K.VINOD CHANDRAN JUDGE Vku/-

WP(C).9232 of 2020 APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1OF THE ASSESSMENT ORDER DATED 12/12/2019. EXHIBIT P2OF THE DEMAND NOTICE DATED 12/12/2019. EXHIBIT P3OF APPEAL DATED 16/1/2020. EXHIBIT P4OF THE STAY PETITION DATED 12/2/2020. EXHIBIT P5OF THE JUDGMENT DATED 1/7/2019 IN W.A.1536 OF 2019. []

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