KANAYANNUR SERVICE CO-OPEATIVE BANK LTD vs. INCOME TAX OFFICER

WP(C)/2625/2020HC KeralaKLHC01007517202030 January 2020Author: HONOURABLE MR. JUSTICE ALEXANDER THOMAS4 pages

AI SummaryRemanded

What did the High Court hold?

The High Court directed the 2nd respondent (Commissioner of Income Tax (Appeals)-2) to take up the stay applications (Exts.P4 and P9) filed by the petitioner in their appeals (Exts.P3 and P8). The Commissioner was instructed to pass orders on these stay applications without undue delay, preferably within two months from the date of production of a certified copy of the judgment, after affording a reasonable opportunity of being heard to the petitioner. Until orders are passed on the stay applications, further coercive steps pursuant to the demand notices (Exts.P2 and P7) for enforcement of the impugned orders (Exts.P1 and P6) will be kept in abeyance. The High Court did not decide the merits of the appeals or the validity of the original orders.

What were the facts?

The petitioner, Kanayannur Service Co-operative Bank Ltd., is challenging orders (Exts.P1 and P6) passed by the assessing authority. Against these orders, the petitioner filed appeals (Exts.P3 and P8) and stay petitions (Exts.P4 and P9) before the Commissioner of Income Tax (Appeals)-2. While these stay petitions were pending, the assessing authority issued demand notices (Exts.P2 and P7) for the recovery of disputed amounts, prompting the petitioner to file the present writ petition before the High Court of Kerala. The petitioner's grievance is the issuance of demand notices during the pendency of their stay applications.

What were the issues?

1. Whether the issuance of demand notices for recovery of disputed amounts is appropriate during the pendency of stay petitions before the appellate authority? (Question of mixed law and fact, concerning principles of natural justice and procedural fairness). Assessee's Contention: The petitioner argues that issuing demand notices for recovery of disputed amounts while stay petitions are pending before the appellate authority is premature and prejudicial. They rely on the principle that coercive steps should be held in abeyance until the stay applications are decided. Revenue's Contention: The judgment records no specific arguments from the revenue regarding the propriety of issuing demand notices during the pendency of stay petitions. The revenue's counsel was heard, but their specific contentions are not detailed in the judgment.

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 THURSDAY, THE 30TH DAY OF JANUARY 2020 / 10TH MAGHA, 1941 WP(C).No.2625 OF 2020(C) PETITIONER: KANAYANNUR SERVICE CO-OPEATIVE BANK LTD NO. 115, CHOTTANIKKARA P.O. ERNAKULAM 682312, REPRESENTED BY ITS SECRETARY. BY ADVS. SRI.C.A.JOJO SRI.MATHEWS JOSEPH RESPONDENTS: 1 INCOME TAX OFFICER WARD 1 (3), KOCHI, CENTRAL REVENUE TOWER, KOCHI 682 018. 2 COMMISSIONER OF INCOME TAX (APPEALS)-2, OFFICE OF THE COMMISSIONER OF INCOME TAX, CENTRAL REVENUE TOWER, , KOCHI 682 018. 3 JOINT COMMISSIONER OF INCOME TAX, CENTRAL REVENUE TOWER , KOCHI 682 018. SRI. CHRISTOPHER ABRAHAM SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 30.01.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P(C) No.2625 of 2020 2 ALEXANDER THOMAS, J. =========================== W.P(C) No.2625 of 2020 =========================== Dated this the 30th day of January, 2020

JUDGMENT Against Exts.P1 and P6 orders, the petitioner has filed Exts.P3 and P8 appeals and Exts.P4 and P9 stay petitions. The petitioner's grievance is that during the pendency of the stay petitions, Exts.P2 and P7 demand notices have been issued for enforcement of the impugned Exts.P1 and P6 orders by the assessing authority for recovery of the disputed amounts.

Heard Sri.C.A.Jojo, learned counsel appearing for the petitioner and Sri.Christopher Abraham, learned standing counsel 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 2nd respondent shall take up the matters in Exts.P4 and P9 stay applications filed in Exts.P3 and P8 appeals and after affording reasonable opportunity of being heard to the petitioner through their authorised representative/counsel, if any, shall pass orders on those applications 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 Exts.P4 and P9 stay applications, further coercive steps pursuant to Exts.P2 and P7 demand notices for enforcement of the impugned Exts.P1 and P6 orders will be kept in abeyance. With these observations and directions, the above Writ Petition (Civil) stands finally disposed of. ALEXANDER THOMAS JUDGE vgd

Appendix — schedule of exhibits

APPENDIX PETITIONER'S EXHIBITS: EXHIBIT P1 A TRUE COPY OF THE ASSESSMENT ORDER AY 2011-12 DATED 28.12.2016 ISSUED BY THE FIRST RESPONDENT. EXHIBIT P2 A TRUE COPY OF THE DEMAND NOTICE FOR AN AMOUNT OF RS.28,22,760/-U/S. 156 DATED 28.12.2016 ISSUED BY THE FIRST RESPONDENT. EXHIBIT P3 A TRUE COPY OF THE APPEAL FOR AY 2011-12 BEFORE THE 2ND RESPONDENT DATED 29.01.207. EXHIBIT P4 A TRUE COPY OF THE STAY PETITION FOR AY 2011-12 BEFORE THE 2ND RESPONDENT DATED 14.03.2017. EXHIBIT P5 A TRUE COPY OF THE STAY ORDER OF THE 3RD RESPONDENT DATED 22.05.2017. EXHIBIT P6 A TRUE COPY OF THE ASSESSMENT ORDER FOR AY 2017-18 DATED 12.12.2019 ISSUED BY THE FIRST RESPONDENT. EXHIBIT P7 A TRUE COPY OF THE DEMAND NOTICE FOR AN AMOUNT OF RS.91,41,563 /U/S- 156 DATED 12.12.2019 ISSUED BY THE FIRST RESPONDENT. EXHIBIT P8 A TRUE COPY OF THE APPEAL FOR AY 2017-18 BEFORE THE 2ND RESPONDENT DATED 13.01.2020. EXHIBIT P9 A TRUE COPY OF THE STAY PETITION FOR AY 2017-18 BEFORE THE 1ST RESPONDENT DATED 15.01.2020. EXHIBIT P10 A TRUE COPY OF THE NOTICE U/S 221(1) ISSUED BY THE 1ST RESPONDENT DATED 17.01.2020.

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