THE POOTHADY SERVICE CO-OPERATIVE BANK LTD NO F.1011 V. THE INCOME TAX OFFICER

WP(C)/8482/2014

AI Insights

The case involves the Poothady Service Co-operative Bank Ltd, which challenged the dismissal of their interlocutory application for a stay on an assessment order by the Income Tax Officer. The assessment order, which was contested, denied the bank an exemption under Section 80P of the Income Tax Act, claiming it was not a 'Primary Agricultural Credit Society'. The bank's appeal against the assessment was initially rejected, leading to this writ petition. The court considered the ongoing related IT appeals and previous orders but found that the specific issues in those cases did not directly impact the current case. The court decided to allow the appeal to proceed conditionally, requiring the bank to pay a portion of the disputed tax.

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 755785 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 25-03-2014
• Assessment Year: misc
• Other Referred Cases: WPC No.19600/2013, WA No.1246/2013, ITA-89/R1/CIT/CLT/2013-14
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: JOSE JOSEPH
• Assessee Lawyers: GEORGE POONTHOTTAM
• Keywords: Appeal; Assessment Order; Exemption; Income Tax; Primary Agricultural Credit Society; Stay Petition
• Section: 80P

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE P.R.RAMACHANDRA MENON TUESDAY, THE 25TH DAY OF MARCH 2014/4TH CHAITHRA, 1936 WP(C).No. 8482 of 2014 (I) --------------------------- PETITIONER(S): -------------------------- THE POOTHADY SERVICE CO-OPERATIVE BANK LTD NO F.101 1, KENICHIRA, SULTHAN BATHERY, WAYANAD DISTRICT, PIN:673 596, REPRESENTED BY THE SECRETARY. BY ADV. SRI.GEORGE POONTHOTTAM RESPONDENT(S): ---------------------------- 1. THE INCOME TAX OFFICER, WARD NO.14, DEPARTMENT OF INCOME TAX, KOZHIKODE-673 001. 2. THE COMMISSIONER OF INCOME TAX (APPEALS), KOZHIKODE-673 001. R1 & R2 BY ADV. SRI.JOSE JOSEPH, SC, INCOME TAX THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 25-03-2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Kss WP(C).No. 8482 of 2014 (I) --------------------------------------- APPENDIX PETITIONER(S)' EXHIBITS: --------------------------------------- EXHIBIT P1: TRUE COPY OF THE JUDGMENT IN WPC NO.19600/2013 DATED 7.8.2013. EXHIBIT P2: TRUE COPY OF THE INTERIM ORDER IN WA NO.1246/2013 DATED 26.8.2013. EXHIBIT P3: TRUE COPY OF THE ORDER OF ASSESSMENT DATED 18.3.2013. EXHIBIT P4: TRUE COPY OF THE APPEAL DATED 18.4.2013 FILED BEFORE THE IST RESPONDENT BY LETTER DATED 19.4.2013. EXHIBIT P5: TRUE COPY OF THE STAY PETITION FILED BEFORE THE IST RESPONDENT DATED 13.12.2013. EXHIBIT P6: TRUE COPY OF THE ORDER DATED 5.2.2014 IN APPEAL NO.ITA- 89/R1/CIT/CLT/2013-14 THROUGH COMMUNICATION DATED 13.3.2014. RESPONDENT(S)' EXHIBITS: ------------------------------------------ N I L /TRUE COPY/ P.A.TO JUDGE Kss P.R. RAMACHANDRA MENON, J. --------------------------------------- W.P.C. No.8482 OF 2014 --------------------------------------- Dated this the 25th day of March, 2014. JUDGMENT The petitioner Society is before this Court, challenging the correctness and sustainability of Ext.P6 order dated 05.02.2014 passed by the 2nd respondent, whereby the Interlocutory Application preferred by the petitioner for granting stay, during the pendency of the appeal has been dismissed. The sequence of events narrated in the writ petition shows that Ext.P3 assessment order was passed on 18.03.2013 by the 1st respondent, which is under challenge in Ext.P4 appeal, filed along with Ext.P5 petition for stay. 2. The claim of the petitioner for exemption under Section 80P of the Income Tax Act was considered and the same was rejected by the Assessing Officer; which in turn is under challenge before the Appellate Authority, stating that the petitioner is a 'Primary Agricultural Credit Society' and is entitled to have exemption under Section 80P of the Act. The version of the petitioner has been considered by the Appellate Authority but W.P.C.No.8482 OF 2014 2 the same came to be rejected as per Ext.P6 order, which is sought to be interfered in this writ petition. 3. The learned counsel for the petitioner points out that, the issue is pending consideration in I.T. Appeals No.103 of 2011 and 137 of 2011 preferred at the instance of some other assessees and that, taking note of the factual position as above, a Division Bench of this Court, vide Ext.P2 order dated 26.08.2013 in W.A. No.1246 of 2013, has virtually dispensed with the condition imposed by the Single Bench in directing to satisfy 50% of the disputed liability by the concerned writ petitioner. It is stated that, final hearing of the appeals is almost over and result is awaited. 4. The learned Standing Counsel appearing for the Department submits that, the ideal understanding of the petitioner as to the scope of I.T. Appeals is wrong and misconceived. It is stated that, the issue involved in the said appeals is entirely different and that the same does not have any connection or significance in so far as the issue in the present case is concerned. It is also pointed out that the benefit of W.P.C.No.8482 OF 2014 3 exemption under Section 80P of the 'Act' can be extended only to a person, who has filed the return and in the instant case, no such return had ever been filed by the petitioner Society, till notice was issued by the competent authority. It is also stated that, a positive finding has been rendered against the petitioner Society, based on the actual facts and figures, holding that the petitioner Society is not a 'Primary Agricultural Credit Society' and hence is not eligible for the benefit of Section 80P of the 'Act'. 5. After hearing both the sides, this Court finds that the finding of the Assessing Authority has been virtually accepted by the Appellate Authority by passing Ext.P6, while rejecting the I.A. for stay. But then, what remains to be considered in the appeal, is the point to be looked into by this Court. This Court finds that, the merit of the case involved in I.T. Appeal Nos.103 of 2011 and 137 of 2011 has to be finally adjudicated by the Appellate Authority by passing appropriate orders in accordance with the relevant provisions of law, so as to enable the petitioner to pursue further steps, if so necessitated. W.P.C.No.8482 OF 2014 4 6. After taking note of the contentions raised from both the sides, this Court directs the petitioner to satisfy 1/3rd of the disputed liability on or before the 15th of April, 2014 subject to which, Ext.P4 appeal preferred by the petitioner against Ext.P3 order shall be considered and final order shall be passed after hearing the petitioner, as expeditiously as possible. Subject to satisfaction of the 1/3rd of the disputed liability as above, coercive proceedings shall be kept in abeyance, till finalisation of the appeal. The petitioner shall produce a copy of this judgment, along with a copy of the writ petition, before the concerned respondent, for further steps. The writ petition is disposed of. P.R. RAMACHANDRA MENON, JUDGE sp "