VEMBAYAM SERVICE CO-OPERATIVE BANK LTD. NO.3121 vs. THE INCOME TAX OFFICER,

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WP(C)/29882/2019HC KeralaKLHC01077876201907 November 2019Author: HONOURABLE DR. JUSTICE A.K.JAYASANKARAN NAMBIAR3 pages
AI SummaryRemanded

What did the High Court hold?

The High Court disposed of the writ petition by directing the third respondent (Income Tax Appellate Tribunal) to consider and pass orders on the petitioner's appeal (Ext.P4) within an outer time limit of six months. The Court also ordered that recovery steps pursuant to the demand notice (Ext.P6) for the amounts confirmed against the petitioner shall be kept in abeyance until the ITAT passes its orders and communicates them to the petitioner. The reasoning is based on the Court's practice in similar matters where it has directed appellate authorities to consider appeals and stayed recovery pending disposal. The principle is that recovery should be deferred until the appellate authority adjudicates the appeal, especially when the appeal concerns a significant deduction claim.

What were the facts?

The petitioner, Vembayam Service Co-operative Bank Ltd., has filed a writ petition challenging a rectified order under the Income Tax Act. The petitioner has appealed this order and filed a stay petition before the Income Tax Appellate Tribunal (ITAT), the third respondent. The petitioner contends that recovery steps are being taken for the amounts confirmed by the rectified order, even before the stay petition is considered. The core issue in the appeal relates to the disallowance of a deduction claimed under Section 80P of the Income Tax Act. The petitioner seeks a direction for the ITAT to consider and pass orders on their appeal.

What were the issues?

1. Whether the Income Tax Appellate Tribunal (ITAT) should be directed to consider and pass orders on the appeal filed by the petitioner within a specified timeframe? (Question of procedure) Assessee's Contention: The petitioner argues that recovery steps are being initiated by the revenue for amounts confirmed by a rectified order, despite an appeal and stay petition being filed before the ITAT. They seek a direction for expeditious disposal of their appeal. Revenue's Contention: The judgment does not record any specific contentions made by the revenue. However, the context implies that the revenue is pursuing recovery of the disputed tax demand.

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 THURSDAY, THE 07TH DAY OF NOVEMBER 2019 / 16TH KARTHIKA, 1941 WP(C).No.29882 OF 2019(I) PETITIONER/S: VEMBAYAM SERVICE CO-OPERATIVE BANK LTD. NO.3121 REPRESENTED BY ITS SECRETARY-IN-CHARGE, KONCHIRA P.O., VEMBAYAM, THIRUVANANTHAPURAM DISTRICT-695615. BY ADVS. SRI.T.R.HARIKUMAR SRI.ARJUN RAGHAVAN RESPONDENT/S: 1 THE INCOME TAX OFFICER, WARD-2(3), OFFICE OF THE ADDITIONAL COMMISSIONER OF INCOME TAX, AAYAKAR BHAVAN, KAWDIAR P.O., THIRUVANANTHAPURAM, PIN-695003. 2 THE COMMISSIONER OF INCOME TAX (APPEALS), AAYAKAR BHAVAN, KAWDIAR P.O., THIRUVANANTHAPURAM, PIN-695003. 3 THE REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH, KENDRIYA BHAVAN, BLOCK NO.C1 AND C2, 1ST FLOOR, KAKKANAD, COCHIN-682030. SRI.CHRISTOPHER ABRAHAM, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 07.11.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.29882 OF 2019(I) 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 Government Pleader 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 pursuant to Ext.P6 demand notice 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

WP(C).No.29882 OF 2019(I) 3

Appendix — schedule of exhibits
APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 A TRUE COPY OF THE ASSESSMENT ORDER FOR THE YEAR 2012-2013 DATED 23.03.2015. EXHIBIT P2 A TRUE COPY OF THE ORDER DATED 05.03.2019 IN ITA NO.18/TVM/CIT(A)/TVM/2015-16 OF THE 2ND RESPONDENT. EXHIBIT P3 A TRUE COPY OF THE ORDER DATED 03.09.2019 IN ITA NO.18/EF/TVM/CIT(A)/TVM/2015-16, ISSUED BY THE 2ND RESPONDENT UNDER SECTION 154 OF THE INCOME TAX ACT. EXHIBIT P4 A TRUE COPY OF THE APPEAL MEMORANDUM DATED 16.10.2019 ALONG WITH AFFIDAVIT AND CHELAN, FILED BEFORE THE INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH. EXHIBIT P5 A TRUE COPY OF THE STAY PETITION FILED ALONG WITH EXT-P4 APPEAL DATED 16.10.2019. EXHIBIT P6 A TRUE COPY OF THE PROCEEDINGS OF HE 1ST RESPONDENT ALONG WITH COMPUTATION SHEET DATED 15.10.2019. sd

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