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

WP(C)/2434/2020HC KeralaKLHC01006880202029 January 2020Author: HONOURABLE MR. JUSTICE ALEXANDER THOMAS4 pages

AI SummaryRemanded

What did the High Court hold?

The High Court of Kerala, in its writ jurisdiction, directed the second respondent (Commissioner of Income Tax (Appeals)) to take up the stay application (Ext.P3) filed in the appeal (Ext.P2). The Court ordered that the Commissioner should pass orders on the stay application without much delay, preferably within two months from the date of production of a certified copy of the judgment. Until such orders are passed on the stay application, further coercive steps for the enforcement of the impugned order (Ext.P1) will be kept in abeyance. The Court did not decide the merits of the appeal or the stay petition itself, but rather directed the expeditious disposal of the stay application. The ratio decidendi is that appellate authorities should expedite the decision on stay petitions to prevent undue hardship to assessees facing coercive recovery while their appeals are pending.

What were the facts?

The petitioner, The Peruvemba Service Co-operative Bank Ltd., is aggrieved by Ext.P1 order. They have filed an appeal (Ext.P2) and a stay petition (Ext.P3) before the Commissioner of Income Tax (Appeals), the second respondent. The petitioner's primary grievance is that despite the pendency of their stay petition, the assessing authority (the first respondent) has initiated coercive recovery proceedings for the disputed amounts. The case came before the High Court of Kerala at Ernakulam for admission.

What were the issues?

1. Whether coercive recovery proceedings can be initiated by the assessing authority during the pendency of a stay petition filed along with an appeal before the Commissioner of Income Tax (Appeals)? (Question of law and fact, concerning the procedural fairness and the interpretation of the Income Tax Act's recovery provisions). Assessee's Contention: The petitioner argues that coercive recovery proceedings should be kept in abeyance until their stay application is decided by the appellate authority. They rely on the principle that a taxpayer should not be subjected to recovery while their appeal and request for a stay are pending. Revenue's Contention: The judgment does not record any specific arguments from the revenue's side regarding the initiation of coercive recovery proceedings during the pendency of the stay petition. However, their presence as respondents indicates their role in the recovery process.

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 WEDNESDAY, THE 29TH DAY OF JANUARY 2020 / 9TH MAGHA, 1941 WP(C).No.2434 OF 2020(D) PETITIONER: THE PERUVEMBA SERVICE CO-OPERATIVE BANK LTD. P-1648, PERUVEMBA P.O. PALAKKAD 678 531, REPRESENTED BY ITS SECRETARY, VIPINRAJ.U., AGED 26, S/O. MALLIKA. BY ADVS. SRI.HARISANKAR V. MENON SMT.MEERA V.MENON RESPONDENTS: 1 THE INCOME TAX OFFICER, INCOME TAX DEPARTMENT, WARD -2, PALAKKAD 678 014. 2 THE COMMISSIONER OF INCOME TAX (APPEALS), SAKTHAN NAGAR, THRISSUR 680 021. ADV. SRI.JOSE JOSEPH, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 29.01.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.2434 OF 2020(D) 2 ALEXANDER THOMAS, J. =========================== W.P(C) No.2434 of 2020 =========================== Dated this the 29th 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.Harisankar V.Menon, learned counsel appearing for the petitioner and Sri.Jose Joseph, 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 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 that application without much delay, preferably within a period of two months from the date of production of a certified copy of this WP(C).No.2434 OF 2020(D) 3 judgment. Until orders are thus passed on the abovesaid stay 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 vgd

WP(C).No.2434 OF 2020(D) 4

Appendix — schedule of exhibits

APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 COPY OF ASSESSMENT ORDER ISSUED BY THE 1ST RESPONDENT FOR THE YEAR 2017-18 DATED 26.12.2019. EXHIBIT P2 COPY OF APPEAL FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT 2017-18 DATED 06.01.2020. EXHIBIT P3 COPY OF STAY PETITION FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT DATED 04.01.2020.

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