KONGAD SERVICE CO-OPERATIVE BANK LTD., vs. THE INCOME TAX OFFICER,

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WP(C)/32561/2019HC KeralaKLHC01084916201902 December 2019Author: HONOURABLE DR. JUSTICE A.K.JAYASANKARAN NAMBIAR4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala quashed the conditional stay order (Ext.P4). It directed the Commissioner of Income Tax (Appeals) to consider and pass orders on the petitioner's appeal (Ext.P2) within six months from the date of receiving a copy of the judgment, after hearing the petitioner. Recovery proceedings for amounts confirmed by the assessment order were to be kept in abeyance until the appellate authority passed its orders and communicated them to the petitioner. The court's reasoning was based on the Division Bench judgment cited by the petitioner, which provided a precedent for dealing with similar cases involving Section 80P deductions and pre-deposit conditions.

What were the facts?

The petitioner, M/s. Kongad Service Co-operative Bank Ltd., filed an appeal (Ext.P2) against an assessment order (Ext.P1) under the Income Tax Act. They also filed a stay petition, which resulted in a conditional stay order (Ext.P4) from the Commissioner of Income Tax (Appeals). The petitioner contended that in similar cases concerning deductions under Section 80P of the Income Tax Act, a Division Bench of the High Court of Kerala had directed the appellate authority to consider appeals without insisting on pre-deposit for stay of recovery. The petitioner sought similar relief.

What were the issues?

1. Whether the conditional stay order (Ext.P4) passed by the Commissioner of Income Tax (Appeals) is liable to be quashed in light of the Division Bench judgment of the High Court of Kerala in W.A.No.1649 of 2019 and connected cases. Assessee's Contention: The petitioner argued that the Division Bench judgment in W.A.No.1649 of 2019 (Ext.P5) mandates that in identical cases involving Section 80P deductions, the appellate authority should consider appeals and grant stay of recovery without insisting on pre-deposit. They relied on this judgment. Revenue's Contention: The judgment records no specific arguments from the revenue's side.

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 MONDAY, THE 02ND DAY OF DECEMBER 2019 / 11TH AGRAHAYANA, 1941 WP(C).No.32561 OF 2019(U) PETITIONER: M/S.KONGAD SERVICE CO-OPERATIVE BANK LTD., NO.P-538, KONGAD POST, PALAKAKD-678 631, REPRESENTED BY ITS SECRETARY, SHYLA.K., AGED 55, D/O.C.GANGADHARAN NAIR. BY ADVS. SRI.HARISANKAR V. MENON SMT.MEERA V.MENON RESPONDENTS: 1 THE INCOME TAX OFFICER, WARD-1, AYAKAR BHAVAN, PALAKKAD-678 014. 2 THE COMMISSIONER OF INCOME TAX (APPEALS), SAKTHAN NAGAR, THRISSUR-680 021. BY ADV.SRI.JOSE JOSEPH THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 02.12.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.32561 OF 2019(U) 2

JUDGMENT Against Ext.P1 assessment order under the Income Tax Act, the petitioner has preferred Ext.P2 appeal before the 2nd respondent. Along with the appeal the petitioner had also preferred stay petition, which came to be disposed by Ext.P4 conditional stay order passed by the 2nd respondent. It is the case of the petitioner that in identical cases involving the deduction under Section 80P of the Income Tax Act a Division Bench of this Court has in the judgment dated 19.07.2019 in W.A.No.1649 of 2019 and connected cases (Ext.P5) directed the 1st appellate authority to consider and pass orders in the appeal without insisting on any pre-deposit as a condition for stay of recovery of the balance amounts confirmed against the assessee.

2.

I have heard the learned counsel appearing for the petitioner as also the learned Standing counsel appearing for the Income Tax Department.

3.

On a consideration of the facts and circumstances of the case as also the submissions made across the bar and taking note of the Division Bench judgment referred above, I dispose the Writ Petition by quashing Ext.P4 conditional stay order and directing the 2nd respondent

WP(C).No.32561 OF 2019(U) 3 to consider and pass orders on Ext.P2 appeal within an outer time limit of six months from the date of receipt of a copy of this judgment, after hearing the petitioner. Recovery steps for recovery of amounts confirmed against the petitioner by the assessment order shall be kept in abeyance till such time as orders are passed by the 2nd respondent as directed and communicated to the petitioner. A.K.JYASANKARAN NAMBIAR

JUDGE mns

WP(C).No.32561 OF 2019(U) 4

Appendix — schedule of exhibits
APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 COPY OF ASSESSMENT ORDER ISSUED BY THE 1ST RESPONDENT FOR THE YEAR 2013-14 DATED 24.03.2016. EXHIBIT P2 COPY OF APPEAL FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT FOR THE YEAR 2013-14 DATED 5.4.2016. EXHIBIT P3 COPY OF STAY PETITION FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT FOR THE YEAR 2013- 14 DATED 5.4.2016. EXHIBIT P4 COPY OF ORDER ISSUED BY THE 2ND RESPONDENT DATED 14.11.2019. EXHIBIT P5 COPY OF JUDGMENT IN WA NO.1649/2019 OF THIS HON'BLE COURT DATED 19.07.2019. EXHIBIT P6 COPY OF JUDGMENT IN WPC NOS.21015 AND 20995/2019 OF THIS HON'BLE COURT DATED 19.08.2019. EXHIBIT P6 A COPY OF JUDGMENT IN WPC NO.22496/2019 OF THIS HON'BLE COURT DATED 19.08.2019. RESPONDENTS EXHIBITS:NIL //TRUE COPY// P.A TO JUDGE

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