CHINGOLI SERVICE CO-OPERATIVE BANK LIMITED vs. COMMISSIONER OF INCOME TAX (APPEALS)

WP(C)/5562/2020HC KeralaKLHC01014841202026 February 2020Author: HONOURABLE MR.JUSTICE S.V.BHATTI4 pages

AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala disposed of the writ petition by directing the Commissioner of Income Tax (Appeals), the first respondent, to consider and dispose of the statutory appeal filed by the petitioner at the earliest. The Court further directed that recovery proceedings and the collection of tax assessed should be kept in abeyance pending the disposal of the appeal. This decision was made taking note of the Full Bench decision reported in The Mavilayi Service Co-operative Bank Ltd. v. The Commissioner of Income Tax, Calicut [2019 (2) KHC 287]. The Court found the facts of the present case to be substantially similar to those in a previous Division Bench judgment (W.A. No. 1536 of 2019), which had granted similar relief. The ratio decidendi is that in cases with similar facts and in light of binding precedents, statutory appeals should be expeditiously disposed of, and recovery should be stayed pending such disposal to prevent prejudice to the assessee.

What were the facts?

The petitioner, Chingoli Service Co-operative Bank Limited, represented by its Secretary, filed a writ petition before the High Court of Kerala. The petition challenges an order or action by the Commissioner of Income Tax (Appeals) and the Income Tax Officer, Ward 1 and TPS, Alappuzha. The petitioner relies on a Division Bench judgment dated July 1, 2019, in W.A. No. 1536 of 2019 and connected cases, which directed the disposal of appeals and granted a stay of recovery proceedings during the pendency of the appeal. The Standing Counsel for the respondents admitted that the facts of the present case are substantially similar to those in the cited Division Bench judgment.

What were the issues?

1. Whether the recovery proceedings and collection of assessed tax should be kept in abeyance pending the disposal of the statutory appeal filed by the petitioner? (Question of law and fact, turning on principles of natural justice and statutory stay provisions). Assessee's Contention: The petitioner relies on the Division Bench judgment in W.A. No. 1536 of 2019, which directed disposal of appeals and granted a stay of recovery proceedings during the pendency of the appeal. They argue that their case is factually similar and should be treated accordingly. Revenue's Contention: The Standing Counsel for the respondents admitted that the facts of the case are substantially the same as those noted by the Division Bench in W.A. No. 1536 of 2019, implying agreement with the petitioner's reliance on that precedent.

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Heard together (2 matters)

WP(C).No.5562 OF 2020

W.A No.1536 of 2019

Read from the judgment's own cause title. This page is filed under one of them.

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI WEDNESDAY, THE 26TH DAY OF FEBRUARY 2020 / 7TH PHALGUNA, 1941 WP(C).No.5562 OF 2020(U) PETITIONER: CHINGOLI SERVICE CO-OPERATIVE BANK LIMITED REPRESENTED BY ITS SECRETARY, CHINGOLI P.O., CHINGOLI, ALAPPUZHA-690532. BY ADVS. SRI.V.G.ARUN (K/795/2004) SMT.V.JAYA RAGI SRI.R.HARIKRISHNAN (KAMBISSERIL) SRI.NEERAJ NARAYAN SHRI.SARATH SUKUMARAN RESPONDENTS: 1 COMMISSIONER OF INCOME TAX (APPEALS) BAKER HILLS, KOTTAYAM-686002. 2 INCOME TAX OFFICER, WARD 1 AND T.P.S, ALAPPUZHA, ARATTUKULANKARA COMPLEX, A.N.PURAM, ALAPPUZHA-688011. SRI.JOSE JOSEPH, STANDING COUNSEL THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 26.02.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

WP(C).No.5562 OF 2020(U) -2- JUDGMENT Dated this the 26th day of February 2020 Heard Sri.Arun V.G., the counsel for the petitioner and Sri. Jose Joseph, the Standing Counsel for respondents.

Petitioner refers to and relies on judgment dated 01.07.2019 in W.A No.1536 of 2019 and connected cases to contend that the Division Bench directed disposal of appeal and granted stay of recovery proceedings during the pendency of the appeal.

The learned Standing Counsel admits that the facts of the case are substantially same and similar to the facts noted by the Division Bench in W.A. No.1536 of 2019, hence can be followed. Hence, the writ petition is disposed of directing the Commissioner of Income Tax (Appeals)/ 1st respondent to consider and dispose of the statutory appeal filed by the WP(C).No.5562 OF 2020(U) -3- petitioner herein at the earliest taking note of the Full Bench decision reported in The Mavilayi Service Co-operative Bank Ltd, v. The Commissioner of Income Tax, Calicut [2019 (2) KHC 287] and to keep in abeyance recovery proceedings and collection of tax assessed, pending disposal of such appeal. S.V.BHATTI JUDGE hmh

WP(C).No.5562 OF 2020(U) -4-

Appendix — schedule of exhibits

APPENDIX PETITIONER'S EXHIBITS: EXHIBIT P1 A TRUE PHOTOCOPY OF THE RETURN OF INCOME DATED 29.09.2019 FOR THE ASSESSMENT YEAR 2017-18. EXHIBIT P2 A TRUE PHOTOCOPY OF THE ASSESSMENT ORDER DATED 12.12.2019 ALONG WITH THE DEMAND NOTICE ISSUED UNDER SECTION 156 OF THE INCOME TAX ACT DATED 12.12.2019 ISSUED FOR THE YEAR 2017-18 BY THE 2ND RESPONDENT. EXHIBIT P3 A TRUE PHOTOCOPY OF THE APPEAL DATED 13.01.2020 FILED FOR THE YEAR 2017-18 BEFORE THE 1ST RESPONDENT. EXHIBIT P4 A TRUE COPY OF THE ORDER DATED 21.01.2020 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P5 A TRUE PHOTOCOPY OF THE APPLICATION FOR STAY DATED 10.02.2020 FILED BY THE PETITIONER BEFORE THE 1ST RESPONDENT. RESPONDENTS' EXHIBITS: NIL

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