THE KECHERY SERVICE CO-OPERATIVE BANK LTD.NO.R286, vs. THE INCOME TAX OFFICER,

WP(C)/2271/2020HC KeralaKLHC01006429202028 January 2020Author: HONOURABLE MR. JUSTICE ALEXANDER THOMAS5 pages

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What did the High Court hold?

The High Court, following the Division Bench judgment in W.A.No. 1529/2019 and other subsequent judgments of the High Court, directed that the 1st appellate authority (Commissioner of Income Tax (Appeals)) shall ensure the final disposal of the petitioner's appeal (Ext.P2) without much delay and within a reasonable time limit, after affording a reasonable opportunity of being heard to the petitioner. Crucially, in the interest of justice, the Court ordered that all coercive steps for the enforcement of the assessment order impugned in the appeal shall be kept in abeyance until final orders are passed disposing of the appeal. The Court did not decide on the merits of the assessment order itself but provided an interim arrangement pending the statutory appeal. No issue was expressly left undecided.

What were the facts?

The petitioner, The Kechery Service Co-operative Bank Ltd., represented by its Secretary, filed a Writ Petition (Civil) before the High Court of Kerala. The petition sought to quash an order issued by the 1st respondent, the Income Tax Officer, Ward 1 and TPS, and to grant other incidental reliefs. The petitioner is challenging an assessment order (Ext.P4) passed by the Income Tax Officer. The matter is before the High Court in a writ petition challenging the actions of the revenue authorities. The procedural history indicates that the petitioner has filed a statutory appeal (Ext.P2) before the Commissioner of Income Tax (Appeals).

What were the issues?

1. Whether the High Court should quash Ext.P4 order issued by the Income Tax Officer, by issuing a writ of certiorari or other appropriate writ, order, or direction? (Question of law and fact, concerning the validity of the assessment order). 2. Whether coercive steps for recovery and collection of the impugned tax should be kept in abeyance until the final decision of the appellate authority in the statutory appeal? (Question of law, concerning interim relief pending appeal). Assessee's Contention: The petitioner seeks to quash the assessment order and obtain other reliefs. The petitioner relies on a Division Bench judgment of the High Court in W.A.No. 1529/2019, which held that insisting on payment of a portion of the demanded amount as a condition for stay need not be insisted upon in similar circumstances. The petitioner also relies on the dictum laid down by a Full Bench of the High Court in Mavilayi Service Co-operative Service Bank Ltd. v. Commissioner of Income Tax, Calicut [2019 (2) KHC 287]. Revenue's Contention: The judgment does not record any specific contentions made by the revenue. However, the revenue is represented by the Government Pleader.

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 TUESDAY, THE 28TH DAY OF JANUARY 2020 / 8TH MAGHA, 1941 WP(C).No.2271 OF 2020(H) PETITIONER: THE KECHERY SERVICE CO-OPERATIVE BANK LTD.NO.R286, KECHERY P.O., THRISSUR - 680 501, REPRESENTED BY ITS SECRETARY, DAVIS P.A., AGED 44, S/O.P.D.ANTHONY. BY ADVS. SRI.HARISANKAR V. MENON SMT.MEERA V.MENON RESPONDENTS: 1 THE INCOME TAX OFFICER, WARD 1 AND TPS,CITY PLAZA,WESTNADA,GURUVAYUR - 680 101. 2 THE COMMISSIONER OF INCOME TAX (APPEALS), SAKTHAN NAGAR, THRISSUR - 680 001. SRI.JOSE JOSEPH, SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28.01.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.2271 OF 2020(H) 2 ALEXANDER THOMAS, J. ------------------------------------------- W.P.(C)No.2271 of 2020 ---------------------------------------------- Dated this the 28th day of January, 2020

JUDGMENT The prayers in the above Writ Petition (Civil) are as follows: “1) To quash Ext.P4 order issued by the 1st respondent by the issue of a writ of certiorari or such other writ or order or direction. 2) To grant the petitioner such other incidental reliefs including the costs of these proceedings.

Heard Sri. Harisankar V. Menon, learned counsel appearing for the petitioner and Smt. M.M. Jasmin, learned Government Pleader appearing for the respondents.

In similar circumstances, a Division Bench of this Court in the judgment dated 1.7.2019 in W.A.No. 1529/2019 has taken the view that the insistence for payment of a portion of the amount demanded, as a condition for grant of stay, need not be insisted in cases as in the instant one and that the Division Bench, for reasons stated therein, has ordered that it is for the appellate authority to take a decision on the statutory appeal at the earliest and that until the final decision is rendered by the appellate authority in the statutory appeal, coercive

WP(C).No.2271 OF 2020(H) 3 steps for recovery and collection of the impugned tax shall be kept in abeyance in the light of the dictum laid down by the Full Bench of this Court in Mavilayi Service Co-operative Service Bank Ltd., v. Commissioner of Income Tax, Calicut [2019 (2) KHC 287]. The Division Bench in the abovesaid judgment dated 1.7.2019 in W.A.No. 1529/2019 has also dealt with the reasons for taking such a view for making such an interim arrangement pending disposal of the main appeal by the statutory appellate authority concerned. The said decision of the Division Bench of this Court in W.A.No. 1529/2019 has been followed by this Court in a series of other cases as in the judgment dated 10.1.2020 in W.P.(C).No.523/2020. Accordingly, following the line of directions and orders already passed by the Division Bench of this Court in the judgment dated 1.7.2019 in W.A.No. 1529/2019 as well as various other judgments rendered by this Court, following the said directions and orders of the Division Bench in the matter of the interim arrangement till the disposal of the main statutory appeal, etc., following orders and directions are issued: It is ordered that the 1st appellate authority shall ensure final disposal of Ext.P-2 appeal after affording reasonable opportunity of being heard to the petitioner without much delay and within a reasonable time limit that may be fixed appropriately by the said appellate authority. However, in the interest of justice it is ordered

WP(C).No.2271 OF 2020(H) 4 that until final orders are passed disposing of Ext.P-2 appeal, all coercive steps for the enforcement of the assessment order impugned in the abovesaid appeal shall be kept in abeyance. With these observations and directions, the Writ Petition (Civil) stands finally disposed of. ALEXANDER THOMAS Nsd //// PA TO JUDGE JUDGE

WP(C).No.2271 OF 2020(H) 5

Appendix — schedule of exhibits

APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 COPY OF ORDER ISSUED BY THE 1ST RESPONDENT FOR THE YEAR 2012-13. EXHIBIT P2 COPY OF APPEAL FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT FOR THE YEAR 2012-13. EXHIBIT P3 COPY OF STAY PETITION FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT FOR THE YEAR 2012-13. EXHIBIT P4 COPY OF STAY ORDER ISSUED BY THE 1ST RESPONDENT. EXHIBIT P5 COPY OF JUDGMENT IN WA NO.1639/19 OF THIS HON'BLE COURT. EXHIBITP5(A) COPY OF JUDGMENT IN WP(C) NO.21015/19 OF THIS HON'BLE COURT.

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