M/S ETTUMANOOR SERVICE CO-OPERATIVE BANK LTD V. THE INCOME TAX OFFICER

WP(C)/33715/2022

AI Insights

The case involves M/s Ettumanoor Service Co-operative Bank Ltd, which filed a writ petition against the Income Tax Department, challenging an assessment order. The petitioner argued that the Assessing Officer failed to consider a relevant Division Bench judgment (Ext.P10) that was crucial to their case, despite it being brought to the officer's notice through a previous communication (Ext.P8). The Income Tax Department acknowledged the oversight but contended that such an error might not warrant interference under Article 226 of the Constitution. The court, while acknowledging the procedural oversight, decided to quash the assessment order and remit the case for a fresh assessment, emphasizing the need to consider the cited judgment.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 750512 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 27-10-2022
• Assessment Year: misc
• Other Referred Cases: ITA No. 323 of 2019 and connected cases
• Laws Referred To: Article 226 of the Constitution of India
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: JOSE JOSEPH
• Assessee Lawyers: S RAJ; C T ARJUN; S RAJ
• Keywords: Assessment Order; Division Bench judgment; Income Tax; Remitted for reassessment
• Section: 143(3); 142(1); 274; 270A; 144B

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE GOPINATH P. THURSDAY, THE 27TH DAY OF OCTOBER 2022 / 5TH KARTHIKA, 1944 WP(C) NO. 33715 OF 2022 PETITIONER: M/S ETTUMANOOR SERVICE CO-OPERATIVE BANK LTD, PEROOR ROAD, ETTUMANOOR, KOTTAYAM – 686 631 REPRESENTED BY ITS SECRETARY-IN-CHARGE THUSHARA JOSEPH BY ADVS. S.ARUN RAJ C.T.SUJA ARJUN S.RAJ RESPONDENTS: 1 THE INCOME TAX OFFICER WARD-1, PUBLIC LIBRARY BUILDING, SASTRI ROAD, KOTTAYAM – 686 001 2 ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/INCOME TAX OFFICER ASSESSMENT UNIT, NATIONAL FACELESS ASSESSMENT CENTRE, INCOME TAX DEPARTMENT, 2ND FLOOR, E-RAMP, JAWAHARLAL NEHRU STADIUM, NEW DELHI – 110 003 3 THE PRINCIPAL COMMISSIONER OF INCOME TAX NAGAMBADAM, KOTTAYAM, PIN – 686 002 BY ADV JOSE JOSEPH, SC, INCOME TAX DEPARTMENT, KERALA THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 27.10.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 33715 OF 2022 2 JUDGMENT This writ petition has been filed on the short ground that Ext.P10 judgment of Division Bench of this Court which squarely covers the issue in favour of the petitioner was not taken note of by the Assessing Officer while issuing Ext.P9 order of assessment, despite the fact that the judgment was brought to his notice through Ext.P8. 2. Learned Standing Counsel for the Income Tax Department states that while it may be true that the Assessing Officer did not consider Ext.P10 Judgment of Division Bench of this Court, that, by itself may not be a ground for interfere with an order of assessment under Article 226 of the Constitution of India. 3. Having heard the learned counsel for the petitioner and the learned counsel appearing for the Income Tax Department, I am of the view that the fact that a Division Bench judgment of this Court was not noticed by the Assessing Officer, should normally be a matter that should be taken up in appeal and there is no good reason as to why an assessment order should be interfered with WP(C) NO. 33715 OF 2022 3 under Article 226 of the Constitution of India, on that ground. However, to avoid inconvenience and hardship to the petitioner Ext.P9 order of assessment is quashed and the matter is remitted to the 2nd respondent, who shall complete the assessment afresh after taking note of Ext.P10 judgment of a Division Bench of this Court. I make it clear that, I have not expressed any opinion on the merits of the matter and it is open to the Assessing Authority to decide the matter in accordance with law also taking into consideration Ext.P10 judgment of a Division Bench of this Court. Sd/- GOPINATH P. JUDGE nak WP(C) NO. 33715 OF 2022 4 APPENDIX OF WP(C) 33715/2022 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE NOTICE UNDER SECTION 142 (1) DATED 09-12-2021 ISSUED BY THE 2ND RESPONDENT FOR THE AY 2020-21 Exhibit P2 TRUE COPY OF THE REPLY DATED 28-12-2021 E-FILED BY THE PETITIONER IN RESPONSE TO THE NOTICE DATED 09-12-2021 Exhibit P3 TRUE COPY OF THE NOTICE DATED 12-03-2022 U/S 142(1) OF THE ACT ISSUED BY THE 2ND RESPONDENT Exhibit P4 TRUE COPY OF THE REPLY DATED 14-03-2022 E-FILED BY THE PETITIONER IN RESPONSE TO THE NOTICE DATED 12-03-2022 ISSUED UNDER SECTION 142(1) OF THE ACT. Exhibit P4(A) TRUE COPY OF THE NOTICE DATED 16-03-2022 U/S 142(1) OF THE ACT ISSUED BY THE 2ND RESPONDENT Exhibit P4(B) TRUE COPY OF THE REPLY DATED 16-03-2022 E-FILED BY THE PETITIONER Exhibit P5 TRUE COPY OF THE SHOW CAUSE NOTICE DATED 21-03-2022 ISSUED BY THE 2ND RESPONDENT FOR THE AY 2020-21 Exhibit P6 TRUE COPY OF THE REPLY DATED 22-03-2022 E-FILED BY THE PETITIONER Exhibit P7 TRUE COPY OF THE SHOW CAUSE NOTICE DATED 01-09-2022 ISSUED BY THE 2ND RESPONDENT FOR THE AY 2020-21 Exhibit P8 TRUE COPY OF THE REPLY DATED 03-09-2022 E-FILED BY THE PETITIONER IN RESPONSE TO WP(C) NO. 33715 OF 2022 5 THE SHOW CAUSE NOTICE DATED 01-09-2022 Exhibit P9 TRUE COPY OF THE ASSESSMENT ORDER DATED 23-09-2022 U/S 143(3) R.W.S. 144 B OF THE ACT ALONG WITH THE DEMAND NOTICE ISSUED BY THE 2ND RESPONDENT FOR THE ASSESSMENT YEAR 2020-21 Exhibit P10 TRUE COPY OF THE JUDGMENT DATED 01-11- 2021 PASSED BY THE DIVISION BENCH OF THIS HONOURABLE COURT IN ITA NO. 323 OF 2019 AND CONNECTED CASES Exhibit P11 TRUE COPY OF THE PENALTY NOTICE DATED 23- 09-2022 UNDER SECTION 274 R.W.S. 270A OF THE ACT FOR THE AY 2020-21 ISSUED BY THE 2ND RESPONDENT "