THE MUNDUR SERVICE CO-OPERATIVE BANK LTD V. THE INCOME TAX OFFICER,

WP(C)/17735/2019

AI Insights

The case involves the Mundur Service Co-operative Bank Ltd, which challenged an assessment order (Ext.P1) by the Income Tax Officer, Ward 2, Palakkad, regarding the disallowance of a deduction under section 80P of the Income Tax Act. The bank appealed to the Commissioner of Income Tax (Appeals), who granted a stay on the recovery of the assessed amount, subject to the condition of depositing 20% of the tax demanded in installments. The bank contested this condition as onerous and sought an extension for the first installment payment. The High Court, after hearing both parties, upheld the stay order, emphasizing the proper consideration and application of mind by the Commissioner.

• Counselvise Citation: [2019] 140 COUNSELVISE.COM (IT) 761158 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 01-07-2019
• Assessment Year: misc
• Laws Referred To: Section 80P of the Income Tax Act
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: JOSE JOSEPH
• Assessee Lawyers: HARISANKAR MENON; MEERA MENON; KRISHNA K
• Keywords: Assessment Order; Co-operative Bank; Deduction Disallowance; Income Tax; Stay of recovery
• Section: 80P

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE S.V.BHATTI MONDAY, THE 01ST DAY OF JULY 2019 / 10TH ASHADHA, 1941 WP(C).No.17735 of 2019 PETITIONER/S: THE MUNDUR SERVICE CO-OPERATIVE BANK LTD NO. F 1650, MUNDUR, PALAKKAD 678 592, REPRESENTED BY ITS SECRETARY, JIJUMON A.J, AGED 45, S/O. JAYAPRAKASH A.L BY ADVS. SRI.HARISANKAR V. MENON SMT.MEERA V.MENON SMT. KRISHNA. K. RESPONDENT/S: 1 THE INCOME TAX OFFICER, WARD 2, AYAKAR BHAVAN, PALAKKAD 678 014 2 THE COMMISSIONER OF INCOME TAX (APPEALS), SAKTHAN NAGAR, THRISSUR 680 001 BY SRI. JOSE JOSEPH, STANDING COUNSEL THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 01.07.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.17735 of 2019 2 JUDGMENT Heard Sri. Harisankar. V. Menon, for the petitioner and Sri. Jose Joseph, for the respondents. 2. The petitioner, a Co-operative Bank is, aggrieved by Ext.P1 assessment order in appeal before the 2nd respondent. The petitioner moved Ext.P3 stay petition praying for stay of recovery pursuant to Ext.P1 assessment order. The 2nd respondent through Ext.P4 considered and granted stay of recovery of the amount determined in Ext.P1 by imposing a condition of depositing 20% of the tax demanded in five equal installments. For convenience, the operative portion of the order of Ext.P4 is extracted herein:- The issue involve the claim of deduction u/s.80P disallowance. In the totality of the facts, I deem it proper to stay 80% of the demand till disposal of appeal or 6 months whichever is earlier. 20% of the balance demand in five equal monthly installment starting from June, 2019 should be paid. The Assessing Officer shall monitor the payment of demand and report and default on part of the appellant. Any default on part of appellant to pay demand will invite revocation of stay granted. WP(C).No.17735 of 2019 3 3. The petitioner challenges Ext.P4 firstly, by contending that the condition imposed of depositing 20% is very onerous and is not compatible to the merits canvassed by the petitioner in the appeal. Alternatively submits that, the petitioner can be given extension of time for making the first installment. In other words, the request is to start the payment, of first installment on or before the 30th day of July, 2019. 4. Ext.P4 is an order made by the 2nd respondent by keeping in view the directions issued by the CBDT and also the merits of the matter. There is sufficient consideration of and application of mind to the issue by the 2nd respondent while granting the stay order. I am convinced that Ext.P4 does not warrant interference of this Court in exercise of its power of review under Article 226 of the Constitution of India and hence the first ground against Ext.P4 fails. 5. The next submission of Sri. Harisankar. V. Menon is that the petitioner may be permitted to comply with the order by starting the payment of the installments on or before 30th of July, 2019. To meet the ends of justice this prayer could be considered and accordingly accepted. Having regard to the WP(C).No.17735 of 2019 4 above, Ext.P4 order reads thus:- The issue involves the claim of deduction u/s.80P disallowance. In the totality of the facts, I deem it proper to stay 80% of the demand till disposal of appeal or 6 months whichever is earlier. 20% of the balance demand in five equal monthly installments starting from on or before the 30th day of July, 2019 should be paid. The Assessing Officer shall monitor the payment of demand and report and default on part of the appellant. Any default on part of appellant to pay demand will invite revocation of stay granted. The Writ Petition stands disposed of, accordingly. Sd/- S.V. BHATTI JUDGE ajt WP(C).No.17735 of 2019 5 APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 COPY OF ASSESSMENT ORDER ISSUED BY THE 1ST RESPONDENT FOR THE YEAR 2016-17 EXHIBIT P2 COPY OF APPEAL FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT FOR THE YEAR 2016-17 EXHIBIT P3 COPY OF STAY PETITION FILED BY THE PETITIONER BEFORE THE 2ND RESPONDENT FOR THE YEAR 2016-17 EXHIBIT P4 COPY OF ORDER ISSUED BY THE 2ND RESPONDENT FOR THE YEAR 2016-17 "