KADUNGALLOOR SERVICE CO-OPERATIVE BANK LIMITED.NO.2165 vs. THE INCOME TAX OFFICER

WP(C)/2782/2020HC KeralaKLHC01007926202031 January 2020Author: HONOURABLE MR. JUSTICE ALEXANDER THOMAS4 pages

AI SummaryRemanded

What did the High Court hold?

The High Court directed the Commissioner of Income Tax (Appeals) (the 2nd respondent) to consider and pass orders on the stay application (Ext.P3) filed in the appeal (Ext.P2) without undue delay, preferably within two months from the date of production of a certified copy of the judgment. Until orders are passed on the stay application, further coercive steps for the enforcement of the impugned order were ordered to be kept in abeyance. The Court did not decide the merits of the appeal or the stay application itself, but ensured that the petitioner would not face recovery actions during the pendency of the decision on the stay petition. The ratio is that the appellate/adjudicating authority should expedite the decision on stay petitions to prevent prejudice to the assessee.

What were the facts?

The petitioner, Kadungalloor Service Co-operative Bank Limited, filed an appeal (Ext.P2) and a stay petition (Ext.P3) against an order (Ext.P1). The petitioner's primary grievance is that despite the pending stay petition, the assessing authority initiated coercive recovery proceedings for the disputed amounts. The case came before the High Court of Kerala at Ernakulam.

What were the issues?

1. Whether coercive recovery proceedings can be initiated by the assessing authority during the pendency of a stay petition filed in an appeal before the Commissioner of Income Tax (Appeals)? (Mixed question of law and fact, concerning principles of natural justice and procedural fairness). Assessee's Contention: The petitioner argued that coercive recovery proceedings should be kept in abeyance until their stay application is decided. They relied on the principle that a taxpayer should not be subjected to recovery actions while seeking relief from higher authorities. Revenue's Contention: The judgment records that the learned Government Pleader appeared for the respondents, but no specific arguments were recorded for the revenue regarding the initiation of coercive steps.

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 ALEXANDER THOMAS FRIDAY, THE 31ST DAY OF JANUARY 2020 / 11TH MAGHA, 1941 WP(C).No.2782 OF 2020(W) PETITIONER/S: KADUNGALLOOR SERVICE CO-OPERATIVE BANK LIMITED.NO.2165 EAST KADUNGALLOOR, U.C.COLLEGE P.O., ALUVA, ERNAKULAM-683102, REPRESENTED BY ITS SECRETARY SRI.N.SANTHOSH KUMAR. BY ADVS. SRI.K.S.HARIHARAN NAIR SMT.G.REMADEVI SMT.HARIMA HARIHARAN SHRI.RAJATH R NATH RESPONDENT/S: 1 THE INCOME TAX OFFICER WARD 2, 2ND FLOOR, K.A.P SHOPPING COMPLEX, RAILWAY STATION ROAD, ALUVA, ERNAKULAM, PIN-683101. 2 THE COMMISSIONER OF INCOME TAX (APPEALS), DEPARTMENT OF INCOME TAX, ERNAKULAM-682018. OTHER PRESENT: SRI.CHRISTOPHER ABRAHAM, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 31.01.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.2782 OF 2020(W) 2 ALEXANDER THOMAS, J. ----------------------------------------- W.P.(C.) No. 2782 of 2020 ----------------------------------------- Dated this the 31st day of January, 2020

JUDGMENT Against Ext. P1 order, the petitioner has filed Ext.P2 appeal and Ext.P3 stay petition. The petitioner's grievance is that during the pendency of the stay petition, coercive recovery proceedings have been initiated by the assessing authority for recovery of the disputed amounts.

Heard Sri.K.S.Hariharan Nair, learned counsel appearing for the petitioner and Sri. Christopher Abraham, learned Government Pleader appearing for the respondents.

After hearing both sides and after taking note of the facts and circumstances of the case, it is ordered in the interest of justice that the 2 nd respondent shall take up the matters in Ext.P3 stay application filed in Ext.P2 appeal and after affording reasonable opportunity of being heard to the petitioner through their authorised representative/ counsel, if any, shall pass orders on those application without much delay, preferably within a period of two months from the date of production of a certified copy of this judgment. Until orders are thus passed on the abovesaid stay

WP(C).No.2782 OF 2020(W) 3 application, further coercive steps for enforcement of the impugned order will be kept in abeyance. With these observations and directions, the above Writ Petition (Civil) stands finally disposed of.

ALEXANDER THOMAS, JUDGE SKS

WP(C).No.2782 OF 2020(W) 4

Appendix — schedule of exhibits

APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 COPY OF ASSESSMENT ORDER DATED 30.12.2019 ISSUED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEAR 2017-18. EXHIBIT P2 COPY OF APPEAL MEMORANDUM DATED 24.01.2020 AGAINST EXT.P1. EXHIBIT P3 COPY OF THE STAY PETITION FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DATED 27.01.2020.

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