THE WEST CHALAKUDY SERVICE CO OPERATIVE BANK LIMITED V. THE COMMISSIONER OF INCOME TAX

WP(C)/2787/2020

AI Insights

The case involves The West Chalakudy Service Co Operative Bank Limited, which filed a writ petition against the Income Tax authorities, challenging an assessment order and seeking a stay on coercive recovery actions until their appeal was heard. The petitioner argued for the consideration of their appeal on merits and requested the court to restrain the respondents from initiating any coercive proceedings until the appeal was decided. The court referenced a series of precedents, including a Division Bench judgment and a Full Bench decision, which supported the petitioner's stance that coercive recovery should be paused pending the decision on the statutory appeal. The court's decision emphasized the importance of allowing the appellate process to proceed without the pressure of immediate financial penalties.

• Counselvise Citation: [2020] 140 COUNSELVISE.COM (IT) 766827 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 31-01-2020
• Assessment Year: misc
• Other Referred Cases: Mavilayi Service Co-operative Service Bank Ltd. v. Commissioner of Income Tax, Calicut [2019 (2) KHC 287], W.A.No. 1529/2019, W.P.(C).No.523/2020
• Laws Referred To: Income Tax Act
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: JOSE JOSEPH
• Assessee Lawyers: O D SIVADAS
• Keywords: Assessment Order; Coercive Proceedings; Income tax appeal; Writ of Mandamus
• Section: 143(3)

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE ALEXANDER THOMAS FRIDAY, THE 31ST DAY OF JANUARY 2020 / 11TH MAGHA, 1941 WP(C).No.2787 OF 2020(W) PETITIONER/S: THE WEST CHALAKUDY SERVICE CO OPERATIVE BANK LIMITED NO.R 262, P.O. CHALAKUDY, CHALAKUDY TALUK, THRISSUR DISTRICT, REPRESENTED BY ITS SECRETARY. BY ADV. SRI.O.D.SIVADAS RESPONDENT/S: 1 THE COMMISSIONER OF INCOME TAX (APPEALS) AYAKAR, BHAVAN, SHAKTAN NAGAR, THRISSUR 680 001. 2 THE PRINCIPAL COMMISSIONER OF INCOME TAX AYAKAR BHAVAN, SHAKTAN NAGAR, THRISSUR 680 001. 3 THE INCOME TAX OFFICER, WARD (2) SHAKTHAN NAGAR, THRISSUR 680 001. OTHER PRESENT: SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 31.01.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.2787 OF 2020(W) 2 ALEXANDER THOMAS, J. ----------------------------------------- W.P.(C.) No. 2787 of 2020 ----------------------------------------- Dated this the 31st day of January, 2020 JUDGMENT The prayers in the above Writ Petition (Civil) are as follows: (1) “Issue a writ of mandamus or other appropriate writ, order or direction to the 1st respondent to consider Ext.P2 appeal on merit and also restraining the respondents from initiating coercive proceedings against the petitioner society till orders are passed in Ext.P2 appeal on merit. (2) Grant such other reliefs which this Honourable Court just and proper in the circumstance of the case.” 2. Heard Sri. O.D.Sivadas, learned counsel appearing for the petitioner and Sri. Jose Joseph, learned Standing Counsel for the Income Tax Department appearing for the respondents. 3. In similar circumstances, a Division Bench of this Court in the judgment dated 1.7.2019 in W.A.No. 1529/2019 has taken the view that the insistence for payment of a portion of the amount demanded, as a condition for grant of stay, need not be insisted in cases as in the instant one and that the Division Bench, for reasons stated therein, has ordered that it is for the appellate authority to take a decision on the statutory appeal at the earliest and that until the final decision is rendered by the appellate authority in the statutory appeal, coercive steps for recovery and WP(C).No.2787 OF 2020(W) 3 collection of the impugned tax shall be kept in abeyance in the light of the dictum laid down by the Full Bench of this Court in Mavilayi Service Co-operative Service Bank Ltd., v. Commissioner of Income Tax, Calicut [2019 (2) KHC 287]. The Division Bench in the abovesaid judgment dated 1.7.2019 in W.A.No. 1529/2019 has also dealt with the reasons for taking such a view for making such an interim arrangement pending disposal of the main appeal by the statutory appellate authority concerned. The said decision of the Division Bench of this Court in W.A.No. 1529/2019 has been followed by this Court in a series of other cases as in the judgment dated 10.1.2020 in W.P.(C).No.523/2020. Accordingly, following the line of directions and orders already passed by the Division Bench of this Court in the judgment dated 1.7.2019 in W.A.No. 1529/2019 as well as various other judgments rendered by this Court, following the said directions and orders of the Division Bench in the matter of the interim arrangement till the disposal of the main statutory appeal, etc., following orders and directions are issued: It is ordered that the 1st respondent appellate authority shall ensure final disposal of Ext.P-2 appeal after affording reasonable opportunity of being heard to the petitioner without much delay and within a reasonable time limit that may be fixed appropriately by the said appellate authority. However, in the interest of justice it is ordered that until final orders are passed disposing of Ext.P-2 appeal, all coercive steps for the enforcement of the assessment order impugned in the abovesaid appeal WP(C).No.2787 OF 2020(W) 4 shall be kept in abeyance. With these observations and directions, the Writ Petition (Civil) stands finally disposed of. Sd/- ALEXANDER THOMAS, JUDGE SKS WP(C).No.2787 OF 2020(W) 5 APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 COPY OF ASSESSMENT ORDER DATED 27.09.2019 ISSUED BY THE 3RD RESPONDENT FOR THE PERIOD 2017-18. EXHIBIT P2 COPY OF THE APPEAL DATED 06.11.2019 FIELD BY THE PETITIONER BEFORE THE 1ST RESPONDENT FOR THE PERIOD 2017-18. EXHIBIT P3 COPY OF THE PROCEEDINGS DATED 20.10.2010 ISSUED BY THE 2ND RESPONDENT DEMANDING TAX. "