D.K. District Womens Co-operative Bank Ltd. V. The Commissioner of Income Tax (Appeals), Mangalore and The Assistant Commissioner of Income Tax Circle 2(1), Mangalore

WP/11273/2015

AI Insights

The case involves M/S D.K. District Womens Co-operative Bank Ltd., represented by its General Manager, Smt. Prathibha Shetty, who filed a writ petition against the Commissioner of Income Tax (Appeals) and the Assistant Commissioner of Income Tax. The petitioner sought a directive for the expeditious disposal of their appeal concerning an assessment order for the year 2012-13, which included an erroneous addition to the bank's income. The bank also contested the rejection of their stay application on the tax demand raised by the assessment order. The court refrained from assessing the merits of the tax additions and focused on procedural expeditiousness and the interim relief concerning the tax demand.

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 671414 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 23-03-2015
• Assessment Year: misc
• Other Referred Cases: Sri. VIJAY MAHANTESH COOPERATIVE BANK LTD. vs JT.COMMISSIONER OF INCOME TAX, BIJAPUR
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: K V ARAVIND
• Assessee Lawyers: R
• Keywords: Appeal; Assessment Order; Income Tax; Stay of demand; Writ petition
• Section: 143(3); 156

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 23rd DAY OF MARCH, 2015 BEFORE THE HON’BLE MR.JUSTICE ARAVIND KUMAR WRIT PETITION NO. 11273/2015 (T-IT) BETWEEN: M/S D.K. DISTRICT WOMENS CO-OPERATIVE BANK LTD., REPRESENTED BY ITS GENERAL MANAGER SMT. PRATHIBHA SHETTY D/O POOVAPPA SHETTY AGED ABOUT 42 YEARS JANATHA BAZAR BUILDING, G.H.S.ROAD MANGALORE-575 001. ... PETITIONER (BY SRI R RAMAMURTHY, ADVOCATE) AND: 1. THE COMMISSIONER OF INCOME TAX (APPEALS) MANGALORE-575 001. 2. THE ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 2(1), C.R.BUILDING M.G.ROAD, ATTAVAR MANGALORE-575 001. …..RESPONDENTS (BY SRI. K.V. ARAVIND, ADVOCATE) 2 WRIT PETITION IS FILED UNDER ARTICLE 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO DIRECT THE R-1 TO DISPOSE OF THE PETITIONER’S APPEALS FILED ON 26.02.2015 FOR THE ASSESSMENT YEAR 2012-13 (ANNEXURE-B) AGAINST THE ORDER OF ASSESSMENT MADE U/S 143(3) OF THE INCOME TAX ACT DATED 30.01.2015 (ANNEXURE-A) AS EXPEDITIOUSLY AS POSSIBLE. THIS PETITION COMING ON FOR PRELIMINARY HEARING THIS DAY, THE COURT MADE THE FOLLOWING: O R D E R By consent of learned Advocates appearing for parties, petition is taken up for final disposal. 2. Heard Sri Rama Murthy, R learned Advocate appearing for petitioner and Sri K V Aravind, learned Panel Counsel appearing for respondents. 3. Petitioner is seeking for a mandamus to first respondent to dispose of the appeal filed on 26.02.2015 challenging the assessment order dated 30.01.2015 (Annexure-A) relating to assessment year 2012-13 and also praying for quashing of the communication dated 27.02.2015 (Annexure-D) issued by second respondent 3 rejecting the application filed by petitioner for stay of collection of demand. 4. Having heard the learned Advocates appearing for parties and on perusal of the case papers, it would indicate that for the assessment year 2012-13, assessment order came to be passed by second respondent under Section 143(3) of the Income Tax Act, 1961. Being aggrieved by the same, appeal came to be filed before appellate authority on 26.02.2015 by petitioner-assessee which is a Co-operative Bank contending interalia that addition made by the assessing Officer towards interest paid by the Bank to its members on term deposit was not called for in view of the decision of the jurisdictional ITAT in ITA No.434/Bang/2013 dated 26.09.2014 rendered in the case of Sri. VIJAY MAHANTESH COOPERATIVE BANK LTD. vs JT.COMMISSIONER OF INCOME TAX, BIJAPUR and as such, petitioner-assessee has contended that disallowance made by the jurisdictional 4 assessing Officer i.e., addition made to the income of the petitioner is erroneous. 5. This Court would not embark upon conducting any enquiry with regard to correctness or otherwise of the assessment order or disallowance made thereunder or additions made inasmuch as, it is in the domain of the appellate authority to examine the said issue. Same is left at it to be examined by the CIT (Appeals) in view of the fact that appeal has been filed and same is pending before first respondent for adjudication. Petitioner-assessee made an application for stay of the demand on account of assessing Officer having raised a demand for tax pursuant to assessment order dated 30.01.2015 and to keep said demand in abeyance till disposal of the appeal. Second respondent has rejected said application by communication dated 27.02.2015 (Annexure-D). 5 6. Grievance of the petitioner is that issue of addition made by second respondent is opposed to the decision of ITAT and said issue is squarely covered in its favour by the final fact finding authority namely, jurisdictional Income Tax Appellate Tribunal and as such, payment of demand raised pursuant to assessment order has to be stayed as otherwise it would be additional burden on the Bank and as such, during pendency of the appeal proceedings, demand for payment of tax by the jurisdictional Officer is to be stayed. 7. Sri K.V.Aravind, learned Panel counsel appearing for respondents has contended that petitioner has to approach the appellate authority for any relief during pendency of the proceedings and as such, no infirmity can be found in the order of jurisdictional assessing Officer dated 30.01.2015 (Annexure-A) and communication dated 27.02.2015 (Annexure-D) whereunder prayer for stay of recovery has been rejected. 6 8. In order to balance the rights of parties, this Court is of the considered view that ends of justice would be met if petitioner-Bank is directed to file an application for stay of the assessment order and/or demand raised thereunder before first respondent - appellate authority, who would examine the claim of petitioner on merits and in accordance with law and pass necessary orders thereon and till said application is disposed of, which shall be three weeks from the date of filing of such application, petitioner should be protected by order of stay of demand made under Section 156 of the Act vide notice of demand dated 30.01.2015. 9. For reasons aforestated, I proceed to pass the following: ORDER (i) Writ petition is hereby allowed in part. (ii) Jurisdictional CIT (Appeals) is directed to dispose of the appeal (Annexure-B) filed 7 by the petitioner and which is pending before said authority expeditiously, at any rate, within six months from the date of receipt of copy of this order. (iii) Petitioner is at liberty to file an application for stay of demand of tax before CIT (Appeals) – first respondent herein within one week from today and CIT (Appeals) - first respondent in the event of such an application is filed, shall consider said application on merits and in accordance with law expeditiously at any rate within an outer limit of three weeks from the date of filing of such application. (iv) Second respondent shall not enforce demand or take steps to recover the tax amount as demanded by him under assessment order dated 30.01.2015- Annexure-A for four (4) weeks or till 8 disposal of application by CIT (Appeals) whichever is earlier. Ordered accordingly. Sd/- JUDGE *sp "