KANHIRODE SERVICE CO-OPERATIVE BANK LTD vs. THE INCOME TAX OFFICER

WP(C)/8306/2020HC KeralaKLHC01021609202017 March 2020Author: HONOURABLE MR. JUSTICE AMIT RAWAL3 pages

AI SummaryRemanded

What did the High Court hold?

The High Court disposed of the writ petition with a direction to the third respondent, the Commissioner of Income Tax (Appeals), to decide the appeal (Ext.P2) in accordance with law. This decision is to be made after affording an opportunity of hearing to the petitioner. The Court specified that the disposal should occur within a period of three months from the date of receipt of a copy of the judgment. Crucially, the Court directed that the Commissioner should not insist on the payment of 20% of the tax demanded, as per a circular of 2017. Furthermore, recovery proceedings pursuant to the assessment order are to be kept in abeyance until a decision is taken on the appeal. The principle established is that appellate authorities can be directed to dispose of appeals expeditiously, and recovery can be stayed pending such disposal, with specific directions regarding pre-deposit amounts based on extant circulars.

What were the facts?

The petitioner, Kanhirode Service Co-operative Bank Ltd., filed a writ petition before the High Court of Kerala seeking a direction for the disposal of its appeal (Ext.P2) pending before the Commissioner of Income Tax (Appeals) (third respondent). The appeal was filed against an assessment order (Ext.P1). The petitioner sought a directive for the expeditious disposal of the appeal. The respondents are the Income Tax Officer, the Principal Commissioner of Income Tax, and the Commissioner of Income Tax (Appeals). The assessment year(s) are not specified in the judgment. The dispute pertains to the assessment order and the pending appeal before the appellate authority.

What were the issues?

1. Whether the High Court should direct the Commissioner of Income Tax (Appeals) to dispose of the pending appeal filed by the petitioner? 2. Whether the Commissioner of Income Tax (Appeals) can be directed to decide the appeal without insisting on the payment of 20% of the tax demanded, in light of a circular of 2017? Assessee's Contentions: The petitioner sought a direction for the disposal of its appeal. It also implicitly argued for the appeal to be considered without the pre-condition of paying 20% of the tax demanded, referencing a circular of 2017. Revenue's Contentions: The judgment records that the learned counsel for both sides were heard, but does not explicitly detail the revenue's arguments. However, the direction to not insist on 20% payment suggests the revenue might have been insisting on it.

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 AMIT RAWAL TUESDAY, THE 17TH DAY OF MARCH 2020 / 27TH PHALGUNA, 1941 WP(C).No.8306 OF 2020(K) PETITIONER: KANHIRODE SERVICE CO-OPERATIVE BANK LTD KANHORODE P.O.KANNUR-670 592, REPRESENTED BY ITS SECRETARY PRADEEPAN K. BY ADV. SRI.S.ARUN RAJ RESPONDENTS: 1 THE INCOME TAX OFFICER WARD-1 AND TPS, AAYAKAR BHAVAN, KANNUR-670 006. 2 THE PRINCIPAL COMMISSIONER OF INCOME TAX, AAYAKAR BHAVAN, NORTH BLOCK, MANANCHIRA, KOZHIKODE- 673 001. 3 THE COMMISSIONER OF INCOME TAX (APPEALS), AAYAKAR BHAVAN, MANANCHIRA, KOZHIKODE-673 001. OTHER PRESENT: SRI CHRISTOPHER ABRAHAM SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 17.03.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.8306 OF 2020 -2-

JUDGMENT Petitioner has approached this Court seeking a direction to dispose of Ext.P2 appeal preferred before the third respondent/Commissioner of Income Tax (Appeals) against the assessment order Ext.P1. 2. Having heard the learned counsel on both sides, the writ petition is disposed of with a direction to the third respondent to take a decision on Ext.P2 appeal in accordance with law, after affording an opportunity of hearing to the petitioner, within a period of three months from the date of receipt of a copy of this judgment without insisting on payment of 20% of the tax demanded, as per circular of 2017. Till such time a decision is taken on the appeal, recovery proceedings pursuant to the assessment order shall be kept in abeyance. AMIT RAWAL vv JUDGE

WP(C).No.8306 OF 2020 -3- APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1OF THE ASSESSMENT ORDER DATED 31.12.2015 PASSED BY THE 1ST RESPONDENT UNDER SECTION 143 (3) OF THE ACT FOR THE AY 2017-18 EXHIBIT P2OF THE FIRST APPEAL FILED BY THE PETITIONER BEFORE THE 3RD RESPONDENT FOR THE AY 2017-18 EXHIBIT P3OF THE APPLICATION OF STAY FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENT FOR THE AY 2017-18 EXHIBIT P4OF THE ORDER DATED 26.2.2020 PASSED BY THE 1ST RESPONDENT DISPOSING THE STAY PETITION FOR THE AY 2017-18 //// PA TO JUDGE

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