MALAPPATTAM SERVICE CO-OPERATIVE BANK LTD. V. ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/INCOME TAX OFFICER, NATIONAL FACELE

WP(C)/10973/2023

AI Insights

The case involves Malappattam Service Co-operative Bank Ltd., which challenged an income tax assessment order for the assessment year 2021-22. The petitioner, represented by its secretary P. Goplakrishnan, argued that the assessment order incorrectly denied them a deduction under Section 80P(2)(a)(i) of the Income Tax Act, relying on a Full Bench decision of the Kerala High Court that had been reversed by the Supreme Court. The respondents were the income tax authorities who had issued the assessment order. The High Court found that the assessment order did not take into account the Supreme Court's reversal of the earlier decision, leading to the setting aside of the assessment order and remitting the matter for re-evaluation.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 762015 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 28-03-2023
• Assessment Year: misc
• Other Referred Cases: Mavilayi Service Co-operative Bank Ltd. v. CIT [I.T. No.97/2016 by order dated 19.03.2019], Mavilayi Service Co-operative Bank Ltd. v. CIT [431 ITR 1 (SC)]
• Laws Referred To: Income Tax Act, Kerala Co-operative Societies Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: JOSE JOSEPH
• Assessee Lawyers: S RAJ; C T ARJUN; S RAJ
• Keywords: Deduction eligibility; Faceless assessment; Income tax assessment; Section 80P; Service Co-operative Society
• Section: 143(3); 144B; 80P(2)(a)(i)

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE ZIYAD RAHMAN A.A. TUESDAY, THE 28TH DAY OF MARCH 2023 / 7TH CHAITHRA, 1945 WP(C) NO. 10973 OF 2023 PETITIONER: MALAPPATTAM SERVICE CO-OPERATIVE BANK LTD. MALAPPATTAM, KANNUR REPRESENTED BY ITS SECRETARY P. GOPLAKRISHNAN, PIN - 670631 BY ADVS. S.ARUN RAJ C.T.SUJA ARJUN S.RAJ RESPONDENTS: 1 ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/INCOME TAX OFFICER, NATIONAL FACELESS ASSESSMENT CENTRE, DELHI 2ND FLOOR, E- RAMP, JAWAHARLAL NEHRU STADIUM, NEW DELHI, PIN - 110003 2 THE PRINCIPAL COMMISSIONER OF INCOME TAX AAYAKAR BHAVAN, NORTH BLOCK, MANANCHIRA, KOZHIKODE, PIN - 673001 BY ADV JOSE JOSEPH, SC, INCOME TAX DEPARTMENT, KERALA THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28.03.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) No.10973/2023 : 2 : JUDGMENT Dated this the 28th day of March, 2023 The petitioner is a Service Co-operative Society registered under the Kerala Co-operative Societies Act, classified as a Primary Agricultural Credit Society and is an assessee under the Income Tax Act. 2. The grievance of the petitioner is that, as per Ext.P4, assessment under the Income Tax Act for the assessment year 2021-22 was completed as per order dated 13.12.2022 under Section 143(3) read with Section 144 B of the Income Tax Act, imposing a huge liability upon them. In the said order, it was held by the 1st respondent bank, the petitioner is not eligible for deduction under Section 80 P(2) (a) (i) of the Act. The aforesaid conclusion was arrived by the 1st respondent by placing reliance upon a Full Bench decision rendered by this Court in Mavilayi Service Co-operative Bank Ltd. v. CIT [I.T. No.97/2016 by order dated 19.03.2019]. WP(C) No.10973/2023 : 3 : 3. The specific contention put forward by the learned counsel for the petitioner is that, the aforesaid decision has already been reversed by the Hon'ble Supreme Court as per the decision rendered in Mavilayi Service Co-operative Bank Ltd. v. CIT [431 ITR 1 (SC)] and this was not taken note of by the 1 st respondent. In the light of the decision rendered by the Supreme Court, Ext.P4 requires to be reconsidered, it was pointed out. The learned Standing Counsel appearing for the respondent agrees that in the light of the decision rendered by the Hon'ble Supreme Court, Ext.P4 has to be reconsidered. In such circumstances, this writ petition is allowed and Ext.P4 assessment order passed by the 1st respondent is hereby set aside. The matter is remitted back to the 1st respondent for fresh consideration. Appropriate orders in accordance with law shall be passed by the 1st respondent after hearing the petitioner and also taking into account the principles laid down by the Hon'ble Supreme Court in Mavilayi Service Co-operative Bank case cited supra. Sd/- ZIYAD RAHMAN A.A. JUDGE ncd WP(C) No.10973/2023 : 4 : APPENDIX OF WP(C) 10973/2023 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE SHOW CAUSE NOTICE DATED 10-11-2022 ISSUED BY THE 1ST RESPONDENT FOR THE AY 2021-22 Exhibit P2 A TRUE COPY OF THE NOTICE DATED 22-11- 2022 ISSUED UNDER SECTION 144 OF THE ACT BY THE 1ST RESPONDENT FOR THE AY 2021-22 Exhibit P3 A TRUE COPY OF REPLY DATED 1-12-2022 E-FILED BY THE PETITIONER IN RESPONSE TO THE NOTICE U/S 144 DATED 22-11-2022 Exhibit P4 A TRUE COPY OF THE ASSESSMENT ORDER DATED 13-12-2022 UNDER SECTION 143(3) R.W.S 144B OF THE ACT AND THE DEMAND NOTICE ISSUED BY THE 1ST RESPONDENT FOR THE AY 2021-22 "