PULAMANTHOLE SERVICE CO OPERATIVE BANK LIMITED NO. F. 1565 vs. THE COMMISSIONER OF INCOME TAX (APPELS)

Heard Sri.O.D.Sivadas, learned counsel appearing for the petitioner society and Sri.Christopher Abraham, learned Standing Counsel for the Income Tax Department, Government of India, appearing for the respondents.

It is pointed by Sri.O.D.Sivadas, learned counsel appearing for WP(C).No.461 OF 2020(G 3 the petitioner that the question regarding the liability of the banks like the petitioner co-operative bank to pay income tax assessed is a matter, which was answered by a Full Bench of this Court in the judgment in Income Tax Appeal, I.T.A.Nos.97/2016 and connected cases on 19.3.2019 {The Mavilayi Service Cooperative Service Bank Ltd., v. Commissioner of Income Tax, Calicut [2019 (2) KHC 287]} Further that in view of the said dictum of the Full Bench of this Court, it is contended that the appellate authority can only remand the matter to the assessing authority for conducting fresh enquiry and hence it is urged that the insistence for making payment of any portion of the amount under demand, pending disposal of the appeal, may cause hardships and prejudices to the petitioner co-operative society concerned. Hence it is contended that, the insistence for making payment of any portion of the amount under demand, pending disposal of the appeal, may cause hardships and prejudices to the banks concerned.

Sri.Christopher Abraham, learned Standing Counsel for the Income Tax Department, Government of India, appearing for the respondents would, on the other hand, urge that part payment insisted for granting stay is a matter, which comes within the discretion of the appellate authority and this Court may not be justified in interfering with discretion of the appellate authority in exercising such discretion of the statutory appellate authority.

However, it is seen that in similar cases it has already been ordered by a Division Bench of this Court in the judgment dated 1.7.2019 in W.A.No.1529/2019 that in the light of the aspects mentioned in the said case, their Lordships of the Division Bench of this Court are of the opinion that the insistence for payment of a portion of the amount demanded, as a condition for granting stay, need not be insisted in the case at hand and hence the Division Bench has ordered that it is for the appellate authority to take a decision on the statutory appeal at the earliest and that until final decision is rendered by the appellate authority in the statutory appeal, coercive steps for recovery and collection of the impugned tax is to be kept in abeyance in the light of the dictum laid down by the Full Bench of this Court in Mavilayi Service Co-operative Bank Ltd.'s case supra. A copy of the abovesaid judgment dated 1.7.2019 rendered by the Division Bench of this Court in W.A.No. 1529/209 along with connected cases, has been made available for the perusal of this Court. Taking note of the said orders issued by the abovesaid Division Bench of this Court, 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 that until final orders are passed disposing of Ext.P-2 appeal, all coercive steps for the enforcement of the assessment order