M/S. NAVAIKULAM SERVICE CO-OPERATIVE BANK LTD V. THE DCIT

WP(C)/15027/2017

AI Insights

The case involves M/s. Navaikulam Service Co-operative Bank Ltd, which challenged notices and survey proceedings issued by the Income Tax authorities under Sections 131 and 133A of the Income Tax Act. The notices sought information regarding deposits made by customers, which the bank contested. The primary legal issue was whether the bank could challenge the summons and survey at the investigative stage. The court held that such challenges are not permissible unless there is a clear demonstration of violation of legal rights or specific breaches by the tax authorities. The court dismissed the petitions, allowing the investigation to proceed.

• Counselvise Citation: [2017] 140 COUNSELVISE.COM (IT) 746264 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 23-06-2017
• Assessment Year: misc
• Laws Referred To: Income Tax Act, Kerala Co-operative Societies Act
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: JOSE JOSEPH; CHRISTOPHER ABRAHAM; K M V PANDALAI
• Assessee Lawyers: T M SREEDHARAN; JACOB CHACKO; C A JOJO
• Keywords: Co-operative Banks; Income Tax; Summons; Survey Proceedings
• Section: 131; 133A

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR. JUSTICE A.K.JAYASANKARAN NAMBIAR FRIDAY, THE 23RD DAY OF JUNE 2017/2ND ASHADHA, 1939 WP(C).No. 15027 of 2017 (C) ---------------------------- PETITIONER: ---------- M/S. NAVAIKULAM SERVICE CO-OPERATIVE BANK LTD, NAVAIKULAM P.O, THIRUVANANTHAPURAM - 695 603, REPRESENTED BY ITS SECRETARY SMT.BUNDU S. BY ADVS.SRI.T.M.SREEDHARAN (SR.) SRI.JACOB CHACKO SRI.C.A.JOJO RESPONDENT(S): -------------- 1. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-2(1), AYAKAR BHAVAN, KAWDIAR, THIRUVANANTHAPURAM - 695 003. 2. THE COMMISSIONER OF INCOME TAX, AYAAKAR BHAVAN KAWDIAR, THIRUVANANTHAPURAM - 695 003. 3. THE PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX (INTELLIGENCE) C.R.BUILDINGS, I.S.PRESS ROAD, COCHIN - 682 018. BY ADVS. SRI JOSE JOSEPH,SC SRI.CHRISTOPHER ABRAHAM, SRI.K.M.V.PANDALAI, THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 23-06-2017, ALONG WITH WPC. 16195/2017, WPC. 16581/2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: K.V. WP(C).No. 15027 of 2017 (C) ---------------------------- APPENDIX PETITIONER(S)' EXHIBITS ----------------------- EXT.P1 TRUE COPY OF CERTIFICATE DATED 25.11.2015 ISSUED BY THE JOINT REGISTRAR (GENERAL), THIRUVANANTHAPURAM. EXT.P2 TRUE COPY OF THE NOTICE U/S. 131 DATED 20.3.2017 ALONG WITH PROCEEDINGS OF SUR4VEY U/S. 133A OF THE ACT ISSUED BY THE 1ST RESPONDENT. EXT.P3 TRUE COPY OF LETTER DATED 04.4.2017 SUBMITTED BY THE PETITIONER TO THE 1ST RESPONDENT. EXT.P4 TRUE COPY OF NOTICE F.NO.CIR.(2)/TVM/131/2016-17 DATED 07.4.2017 ISSUED BY THE 1ST RESPONDENT. EXT.P5 TRUE COPY OF REPLY DATED 12.4.2017 SUBMITTED BY THE PETITIONER TO THE 1ST RESPONDENT. EXT.P6 TRUE COPY OF THE NOTICE DATED 20.4.2017 ISSUED BY THE 1ST RESPONDENT. RESPONDENT(S)' EXHIBITS NIL ----------------------- /TRUE COPY/ P.S.TO JUDGE K.V. A.K.JAYASANKARAN NAMBIAR, J. ............................................................. W.P.(C).Nos.15027, 16581 & 16195 of 2017 ............................................................. Dated this the 23st day of June, 2017 J U D G M E N T The petitioners, who are Co-operative Banks and established as Primary Agricultural Credit Societies under the Kerala Co- operative Societies Act, have approached this Court aggrieved by notices issued to them under Section 131, along with Survey proceedings initiated under Section 133A, by the Income Tax authorities, seeking information from them for the purposes of proceedings under the Income Tax Act. Although various contentions are raised in these writ petitions challenging the notices, I am of the view that at the investigative stage of proceedings initiated by the Income Tax Department, it is not open to the petitioner to challenge the summons issued seeking information with regard to deposits effected by customers with the petitioner bank. If the petitioner alleges a breach of any of the statutory conditions occasioned by the respondents, it is for the petitioners to establish, with reference to specific instances, the -2- W.P.(C).Nos.15027, 16581 & 16195 of 2017 particulars of the breach occasioned by the tax authorities while exercising their statutory powers. From the proceedings impugned in the writ petition, I find that, they are only in the nature of summons and a survey that is initiated by the respondents seeking certain information of depositors for the purposes of proceedings under the Income Tax Act. The petitioners cannot be prejudiced by a request for specific details, sought for by a statutory authority unless they demonstrate that there has been any violation of their legal rights through the issuance of the said summons. A mere inconvenience caused to the petitioners cannot be treated as a violation of the petitioner's legal rights. In the absence of any instance of violation of rights being demonstrated in these cases, it is my view that the impugned notices cannot be interfered with in a writ petition, since it would tantamount to an interference with an investigation being carried out by the authorities under the Income Tax Act. The writ petitions, therefore, fail and are accordingly dismissed. Sd/- A.K.JAYASANKARAN NAMBIAR JUDGE mns/23.06.17 -3- W.P.(C).Nos.15027, 16581 & 16195 of 2017 "