PERUNGUZHI SERVICE CO-OPERATIVE BANK LTD. NO.2403 vs. THE INCOME TAX OFFICER, WARD-2(5),

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WP(C)/31911/2019HC KeralaKLHC01083485201926 November 2019Author: HONOURABLE DR. JUSTICE A.K.JAYASANKARAN NAMBIAR4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court disposed of the writ petition by directing the ITAT (3rd respondent) to consider and pass orders on the appeal (Ext.P4) within an outer time limit of six months. The Court further directed that recovery steps for the amounts confirmed against the petitioner be kept in abeyance until orders are passed by the ITAT and communicated to the petitioner. The judgment does not provide a decision on the merits of the disallowance of deduction under Section 80P, as it focuses on the procedural aspect of expediting the appeal and staying recovery. The principle established is that recovery should be stayed pending the disposal of an appeal where a stay petition is also filed, and the appellate authority should be directed to dispose of the appeal expeditiously.

What were the facts?

The petitioner, Perunguzhi Service Co-operative Bank Ltd., filed a writ petition before the High Court of Kerala challenging a rectified order under the Income Tax Act. The petitioner had preferred an appeal and a stay petition before the Income Tax Appellate Tribunal (ITAT). However, the petitioner contended that recovery steps were being taken by the respondents for the amounts confirmed by the rectified order, even before the stay petition was considered. The core issue in the appeal concerned the disallowance of deduction claimed under Section 80P of the Income Tax Act.

What were the issues?

1. Whether the recovery steps initiated by the respondents are premature, given that an appeal and stay petition are pending before the ITAT? 2. Whether the disallowance of deduction claimed under Section 80P of the Income Tax Act is justified? Assessee's Contentions: The petitioner argued that recovery steps were being taken despite the pendency of their appeal and stay petition before the ITAT. The issue in the appeal relates to the disallowance of deduction under Section 80P. Revenue's Contentions: The judgment does not record any specific contentions from the revenue regarding the premature recovery or the merits of the Section 80P disallowance.

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 TUESDAY, THE 26TH DAY OF NOVEMBER 2019 / 5TH AGRAHAYANA, 1941 WP(C).No.31911 OF 2019(L) PETITIONER: PERUNGUZHI SERVICE CO-OPERATIVE BANK LTD. NO.2403 REPRESENTED BY ITS SECRETARY, PERUNGUZHI P.O., THIRUVANANTHAPURAM DISTRICT-695 305. BY ADVS. SRI.T.R.HARIKUMAR SRI.ARJUN RAGHAVAN RESPONDENTS: 1 THE INCOME TAX OFFICER, WARD-2(5), OFFICE OF THE ADDITIONAL COMMISSIONER OF INCOME TAX, AAYAKAR BHAVAN, KAWDIAR P.O., THIRUVANANTHAPURAM, PIN- 695 003. 2 THE COMMISSIONER OF INCOME TAX(APPEALS), AAYAKARA BHAVAN, KOWDIAR, THIRUVANANTHAPURAM, PIN-695 003. 3 THE REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH, KENDRIYA BHAVAN, BLOCK NO.C1 AND C2, 1ST FLOOR, KAKKANAD, COCHIN-682 030. BY ADV.SRI. CHRISTOPHER ABRAHAM, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 26.11.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P(C).No.31911 of 2019 2

JUDGMENT Against Ext.P3 rectified order under the Income Tax Act, the petitioner has preferred Ext.P4 appeal together with Ext.P5 stay petition before the 3rd 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.P3 rectified 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 3rd respondent to consider and pass orders on Ext.P4 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 3rd respondent as directed above and communicated to the petitioner. A.K.JAYASANKARAN NAMBIAR

JUDGE mns

Appendix — schedule of exhibits
APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 A TRUE COPY OF THE ASSESSMENT ORDER FOR THE YEAR 2015-2016 DATED 15.12.2017. EXHIBIT P2 A TRUE COPY OF THE ORDER DATED 10.12.2018 IN ITA NO.243/EF/TVM/CIT(A)/TVM/2017-18 OF THE 2ND RESPONDENT. EXHIBIT P3 A TRUE COPY OF THE ORDER DATED 03.09.2019 IN ITA NO.243/EF/TVM/CIT(A)/TVM/2017-18 ISSUED BY THE 2ND RESPONDENT UNDER SECTION 154 OF THE INCOME TAX ACT. EXHIBIT P4 A TRUE COPY OF THE APPEAL MEMORANDUM ALONG WITH AFFIDAVIT DATED 29.10.2019 AND CHELAN. EXHIBIT P5 A TRUE COPY OF THE STAY PETITION FILED ALONG WITH EXT.P4 APPEAL DATED 29.10.2019. RESPONDENTS EXHIBITS:NIL //TRUE COPY// P.A TO JUDGE

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