THE PARAPPUR SERIVE CO-OPERATIVE BANK LTD. NO.474 vs. THE COMMISSIONER OF INCOME TAX (APPEALS0

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WP(C)/8942/2020HC KeralaKLHC01022831202023 March 2020Author: HONOURABLE MR.JUSTICE K.VINOD CHANDRAN4 pages
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What did the High Court hold?

The High Court held that recovery proceedings should be stayed until the appeals are disposed of by the Commissioner of Income Tax (Appeals). The Court directed a stay of recovery until the appeals are decided. The Court explicitly stated that no observation was made on the merits of the matter, implying that the eligibility for Section 80P deduction and the underlying tax liability were not adjudicated. The operative direction was to stay the recovery.

What were the facts?

The petitioner, The Parappur Service Co-operative Bank Ltd., filed a writ petition challenging the recovery proceedings initiated by the Income Tax Department while appeals and stay petitions were pending before the Commissioner of Income Tax (Appeals). The disputes pertain to assessment years 2013-2014, 2010-2011, 2014-2015, and 2015-2016. The core issue revolves around the eligibility of the petitioner for deduction under Section 80P of the Income Tax Act, 1961, a matter to be decided in light of a Full Bench decision.

What were the issues?

1. Whether recovery proceedings can be initiated while appeals and stay petitions are pending before the Commissioner of Income Tax (Appeals) concerning the eligibility of the petitioner under Section 80P of the Income Tax Act, 1961? Assessee's Contention: The assessee argued that recovery should be stayed as appeals and stay petitions are pending before the first appellate authority. 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 regarding the stay of recovery. The revenue's role was in initiating the recovery proceedings.

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.8942 OF 2020 PETITIONER: THE PARAPPUR SERVICE CO-OPERATIVE BANK LTD. NO.474 THOLUR ROAD, PARAPPUR, THRISSUR 680 552, REPRESENTED BY ITS SECRETARY. BY ADV. SRI.P.C.SASIDHARAN RESPONDENTS: 1 THE COMMISSIONER OF INCOME TAX (APPEALS) AAYAKAR BHAVAN, S.T NAGAR, THRISSUR 680 001 2 THE INCOME TAX OFFICER, WARD 2 (5), THRISSUR RANGE-2, AYAKKAR BHAVAN, SAKTHAN THAMPURAN NAGAR, THRISSUR 680 001. 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: W.P.(C) No.8942 of 2020 2

J U D G M E N T The writ petition is against the recovery initiated while appeals are 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 years 2013-2014, 2010-2011, 2014-2015 and 2015-2016. Exhibits P4, P8, P12 and P16 appeals and Exhibits P5, P9, P13 and P17 stay petitions 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 appeals are disposed of. The writ petition is disposed of with the above direction, without any observation on the merits of the matter. pkk K.VINOD CHANDRAN, JUDGE

W.P.(C) No.8942 of 2020 3 APPENDIX PETITIONER'S EXHIBITS: EXHIBIT P1OF THE ASSESSMENT ORDER DATED 29/12/2016 ALONG WITH COMPUTATION SHEET EXHIBIT P2OF THE RECTIFICATION ORDER DATED 18/6/2018 EXHIBIT P3OF THE DEMAND NOTICE DATED 21/6/2018 EXHIBIT P4OF THE APPEAL DATED 31/1/2017 EXHIBIT P5OF THE STAY PETITION DATED 11/7/2018 EXHIBIT P6OF THE ASSESSMENT ORDER DATED 21/12/2017 ALONG WITH COMPUTATION SHEET EXHIBIT P7OF THE DEMAND NOTICE DATED 21/12/2017 EXHIBIT P8OF THE APPEAL DATED 22/1/2018 EXHIBIT P9OF THE STAY PETITION DATED 11/7/2018 EXHIBIT P10OF THE ASSESSMENT ORDER DATED 21/12/2017 ALONG WITH COMPUTATION SHEET EXHIBIT P11OF THE DEMAND NOTICE DATED 21/12/2017 EXHIBIT P12OF THE APPEAL DATED 22/1/2018 EXHIBIT P13OF THE STAY PETITION DATED 11/7/2018 EXHIBIT P14OF THE ASSESSMENT ORDER DATED 21/12/2017 ALONG WITH COMPUTATION SHEET

W.P.(C) No.8942 of 2020 4 EXHIBIT P15OF THE DEMAND NOTICE DATED 21/12/2017 EXHIBIT P16OF THE APPEAL DATED 22/1/2018 EXHIBIT P17OF THE STAY PETITION DATED 11/7/2018 EXHIBIT P18OF THE JUDGMENT DATED 1/7/2019 IN W.A NO. 1536 OF 2019

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