CHENKAL SERVICE CO-OPERATIVE BANK LTD NO 1258 vs. THE CENTRAL BOARD OF DIRECT TAXES

WP(C)/4884/2020HC KeralaKLHC01013483202020 February 2020Author: HONOURABLE MR. JUSTICE AMIT RAWAL3 pages

AI SummaryRemanded

What did the High Court hold?

The High Court directed the Commissioner of Income Tax (Appeals) (third respondent) to decide the appeal (Ext.P2) in accordance with the law. This decision is to be made after providing the petitioner an opportunity of hearing. The court specified a timeframe of three months from the date of receiving a copy of the judgment for the disposal of the appeal. Crucially, the court directed that the Commissioner should not insist on the payment of 20% of the tax demanded, referencing a circular from 2017. Furthermore, recovery proceedings initiated pursuant to the assessment order were ordered to be kept in abeyance until a decision is taken on the appeal. The court did not decide on the merits of the appeal itself.

What were the facts?

The petitioner, Chenkal Service Co-operative Bank Ltd. No. 1258, filed a writ petition before the High Court of Kerala seeking a direction for the disposal of its appeal (Ext.P2) pending before the Commissioner of Income Tax (Appeals) (third respondent). This appeal was filed against an assessment order (Ext.P1). The petitioner was represented by its Secretary, and the respondents included the Central Board of Direct Taxes, the Income Tax Officer, the Commissioner of Income Tax (Appeals), and the Managing Director of Kerala State Co-operative Bank Ltd. The writ petition was filed on February 20, 2020.

What were the issues?

1. Whether the High Court should direct the Commissioner of Income Tax (Appeals) to dispose of the pending appeal filed by the petitioner. (Question of procedure) Assessee's Contention: The petitioner sought a direction for the expeditious disposal of its appeal. The judgment does not explicitly record the petitioner's arguments beyond this request. Revenue's Contention: The judgment does not explicitly record the revenue's arguments. However, the court's direction implies that the revenue's position might have involved insisting on the payment of 20% of the tax demanded as a pre-condition for hearing the appeal, which the court overruled based on a circular.

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 AMIT RAWAL THURSDAY, THE 20TH DAY OF FEBRUARY 2020 / 1ST PHALGUNA, 1941 WP(C).No.4884 OF 2020(I) PETITIONER/S: CHENKAL SERVICE CO-OPERATIVE BANK LTD NO 1258 CHENGAL P. O., NEYYATTINKARA, THIRUVANANTHAPURAM - 695132, REPRESENTED BY ITS SECRETARY VIMAL V. V. BY ADVS. DR.K.P.PRADEEP SMT.T.THASMI RESPONDENT/S: 1 THE CENTRAL BOARD OF DIRECT TAXES DEPARTMENT OF REVENUE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NORTH BLOCK, NEW DELHI - 110 001, REPRESENTED BY ITS CHAIRMAN. 2 INCOME TAX OFFICER WARD - 2(2), AAYAKKAR BHAVAN, 1ST FLOOR, KOWDIAR P. O., THIRUVANANTHAPURAM - 695 003. 3 COMMISSIONER OF INCOME TAX (APPEALS) THIRUVANANTHAPURAM, AAYAKKAR BHAVAN, INCOME TAX OFFICE, KOWDIAR, THIRUVANANTHAPURAM - 695 003. 4 THE MANAGING DIRECTOR KERALA STATE CO-OPERATIVE BANK LTD., HEAD OFFICE, CO-BANK TOWERS, PALAYAM, THIRUVANANTHAPURAM - 695 033. OTHER PRESENT: SRI CHRISTOPHER ABRAHAM,SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 20.02.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.4884 OF 2020(I) 2

JUDGMENT Petitioner has approached this Court seeking a direction to dispose of Ext.P2 appeal preferred before the third respondent/Commissioner of Income Tax (Appeals) against the assessment order Ext.P1. 2. Having heard the learned counsel on both sides, the writ petition is disposed of with a direction to the third respondent to take a decision on Ext.P2 appeal in accordance with law, after affording an opportunity of hearing to the petitioner, within a period of three months from the date of receipt of a copy of this judgment without insisting on payment of 20% of the tax demanded, as per circular of 2017. Till such time a decision is taken on the appeal, recovery proceedings pursuant to the assessment order shall be kept in abeyance. AMIT RAWAL sab JUDGE

WP(C).No.4884 OF 2020(I) 3 APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1OF THE ASSESSMENT ORDER NO.AAAAC1802D DATED 27.12.2019 ISSUED FOR THE YEAR 2012-13 BY THE 2ND RESPONDENT. EXHIBIT P2OF THE APPEAL DATED 11.2.2020 FILED BEFORE THE 3RD RESPONDENT FOR THE ASSESSMENT YEAR 2012-13. EXHIBIT P3OF THE DEMAND NOTICE NO. PAN AAAAC1802D DATED 27.12.2019 ISSUED FOR THE YEAR 2012-13 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P3 (a)OF THE NOTICE NO.ITBA/COM/F/17/2019-20/1024833123(1) DATED 7.2.2020 FOR THE YEAR 2012-13 ISSUED BY THE 2ND RESPONDENT. EXHIBIT P4OF THE STAY APPLICATION FILED ON 11.2.2020 BEFORE THE 3RD RESPONDENT IN EXT. P2 APPEAL.

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