Mullakodi Co-operative Rural Bank Limited V. Assessment Unit, National E-Assessment Centre, Income Tax Department and The Principal Commissioner of Income Tax

WP(C)/9875/2024

AI Insights

The case involves Mullakodi Co-operative Rural Bank Limited, which filed a writ petition against the assessment order issued by the Income Tax Department's National E-Assessment Centre. The assessment order was based on the bank's income tax return for the Assessment Year 2022-23, which showed a total income of Rs.4,29,940. The return was selected for scrutiny due to discrepancies noted under the Computer Aided Scrutiny Selection (CASS) system, including high liabilities compared to low income and a very low PBDIT ratio. The petitioner failed to respond to several notices during the assessment process and only requested additional time after receiving a show cause notice under Section 144, which the court found insufficient to warrant a delay in the assessment process.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 798281 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 04-04-2024
• Assessment Year: misc
• Laws Referred To: Income Tax Act 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: P G JAYASHANKAR; G KEERTHIVAS
• Assessee Lawyers: S RAJ
• Keywords: Assessment Order; CASS; Co-operative Bank; Income Tax; Non-cooperation; Scrutiny
• Section: 144; 143(2); 143(1); 144B

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH THURSDAY, THE 4TH DAY OF APRIL 2024 / 15TH CHAITHRA, 1946 WP(C) NO. 9875 OF 2024 PETITIONER/S: MULLAKODI CO-OPERATIVE RURAL BANK LIMITED F1230, KP-VI/429A, KOLACHERY MUKKU, KOLACHERY, KANNUR, REPRESENTED BY ITS SECRETARY HARIDASAN C., PIN - 670601 BY ADV S.ARUN RAJ RESPONDENT/S: 1 ASSESSMENT UNIT, NATIONAL E-ASSESSMENT CENTRE, INCOME TAX DEPARTMENT, 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 ADVS. P.G.JAYASHANKAR; G.KEERTHIVAS SRI. G. KEERTHIVAS- SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 04.04.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) No.9875/2024 -2- J U D G M E N T The present writ petition has been filed impugning the Ext.P3 Assessment Order passed by the 1st respondent under Section 144 read with Section 144B of the Income Tax Act 1961 for the Assessment Year 2022-23. 2. The petitioner is a Co-operative Rural Bank Limited. It filed its return of income for the Assessment Year 2022-23 showing a total income of Rs.4,29,940/-. The income tax return filed by the petitioner was processed under Section 143(1) of the Act. The petitioner’s case was selected for scrutiny under CASS. The petitioner was issued a notice under Section 143(2) of the Act on 02.06.2023 which was duly served on the petitioner. 3. The CASS would suggest the following issues in the return of the petitioner: W.P.(C) No.9875/2024 -3- “(i) High liabilities as compared to low income/receipts, (ii) Very Low PBDIT ratio in specific business code and turnover range where deficiency is reported in audit report & (iii) Claim of deduction under Section 80P by entities having Bank in their name or approved under the Banking Regulation Act.” 4. The details of opportunities given to the petitioner have been mentioned in paragraph 2 of the Assessment Order, which would suggest that the petitioner did not file response to any of the notices issued to him from 02.06.2023 to 25.01.2024. 5. The learned Counsel for the petitioner submits that the petitioner, in response to the show cause notice under Section 144 dated 03.01.2024, requested to give him some time. However, without affording any other time except what was mentioned in the show cause notice, the assessment authority proceeded to pass the assessment order. W.P.(C) No.9875/2024 -4- 6. The conduct of the petitioner would suggest that the petitioner was not cooperating throughout. He did not file any response to notices issued under Sections 142(1) and 143(2). Suddenly, the petitioner woke up when he received the last show cause notice under Section 144 and asked for time. I am of the considered view that the Assessing Authority was well within its power not to accede to such a request. I find no substance in the present writ petition, which is hereby dismissed. Sd/- DINESH KUMAR SINGH JUDGE jjj W.P.(C) No.9875/2024 -5- APPENDIX OF WP(C) 9875/2024 PETITIONER EXHIBITS Exhibit P1 A TRUE COPY OF THE SHOW CAUSE NOTICE DATED 25- 1-2024 ISSUED BY THE 1ST RESPONDENT FOR THE AY 2022-23 Exhibit P2 A TRUE COPY OF THE ACKNOWLEDGMENT DATED 6-2- 2024 ON THE REQUEST OF THE PETITIONER FOR 10 DAYS TIME Exhibit P3 A TRUE COPY OF THE ASSESSMENT ORDER DATED 12-2- 2024 UNDER SECTION 144 R.W.S 144B OF THE ACT ISSUED BY THE 1ST RESPONDENT FOR THE AY 2022-23 "