Vatakara Town Co-operative Urban Society Ltd. V. Union of India and The Assistant Commissioner of Income Tax National Faceless Assessment Centre, New Delhi and Commissioner of Income Tax (Appeals) National Faceless Appeal Centre, New Delhi and The Income Tax Officer Income Tax Office, Ward2(2) Kozhikode and State of Kerala

WP(C)/15876/2023

AI Insights

The case involves the Vatakara Town Co-operative Urban Society Ltd., which filed a writ petition against the Union of India and other respondents challenging an assessment order (Ext P8) that directed the society to pay a substantial amount of Rs.9,52,57,856. The society argued that as a co-operative credit society, it was entitled to deductions under Section 80P of the Income Tax Act, 1961, which were not considered in the assessment. The society had already filed an appeal (Ext P9) against the assessment order and sought to stay the operation of this order while the appeal was being considered. The court, acknowledging the ongoing appeal process, refrained from intervening directly and instead directed the appellate authority to expedite the consideration of the delay and stay petitions.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 815154 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 23-05-2023
• Assessment Year: misc
• Other Referred Cases: Archana Agencies vs. Commercial Tax Officer [2014 (2) KLT 715]
• Laws Referred To: Income Tax Act, 1961, Kerala Co-operative Societies Rules, 1969
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: S MANU CHRISTOPHER ABRAHAM; THUSHARA JAMES
• Assessee Lawyers: K RAKESH ROSHAN; RAJEESH R
• Keywords: Appeal; Assessment Order; Co-operative Society; Deduction; Income Tax; Stay Petition; Writ petition
• Section: 143(2); 80P; 156

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE C.S.DIAS TUESDAY, THE 23RD DAY OF MAY 2023 / 2ND JYAISHTA, 1945 WP(C) NO. 15876 OF 2023 PETITIONER: VATAKARA TOWN CO-OPERATIVE URBAN SOCIETY LTD., NO.2822 LINK ROAD, NEAR OLD BUS STAND,VADAKARA(P.O), KOZHIKODE DISTRICT, KERALA STATE, REPRESENTED BY ITS SECRETARY RAJEESH.R, PIN – 673101 BY ADVS. K.RAKESH ROSHAN RAJESH.R RESPONDENTS: 1 UNION OF INDIA REPRESENTED BY ITS SECRETARY, DEPARTMENT OF REVENUE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NORTH BLOCK, NEW DELHI, PIN – 110001 2 THE ASSISTANT COMMISSIONER OF INCOME TAX NATIONAL FACELESS ASSESSMENT CENTRE, NEW DELHI,, PIN – 110001 3 COMMISSIONER OF INCOME TAX (APPEALS) NATIONAL FACELESS APPEAL CENTRE, (NFAC), NEW DELHI., PIN – 110001 4 THE INCOME TAX OFFICER INCOME TAX OFFICE, WARD2(2) KOZHIKODE., PIN – 673001 5 STATE OF KERALA REPRESENTED BY SECRETARY (CO-OPERATION), SECRETARIAT, THIRUVANANTHAPURAM, PIN – 695001 BY ADVS. S.MANU CHRISTOPHER ABRAHAM OTHER PRESENT: GP- SMT THUSHARA JAMES THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 23.05.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C)No.15876/2023 -:2:- Dated this the 23rd day of May,2023 J U D G M E N T The writ petition is filed to quash Ext P8 assessment order passed by the second respondent as against the petitioner. 2. The petitioner’s case is that, it is a co-operative society classified as co-operative credit society under Rule 15 of the Kerala Co-operative Societies Rules, 1969. They are entitled for deduction of ITS business income from taxable income under the provisions of Section 80P of the Income Tax Act, 1961. Nevertheless, the second respondent has passed Ext P8 order, directing the petitioner to pay an amount of Rs.9,52,57,856/-. Aggrieved by Ext P8 order, the petitioner has preferred Ext P9 appeal before the third respondent. Along with Ext P9, the petitioner has filed Ext P10 delay petition and Ext P13 stay petition to stay W.P.(C)No.15876/2023 -:3:- the operation of Ext P8 order. But, the petitioner contends therein a case of identical circumstances this Court has entertained a writ petition and passed Ext P12 order. The petitioner is apprehensive that though it has filed Ext P9 appeal, the third respondent may not consider all the legal contentions addressed by the petitioner in Ext P9 appeal. Thus, the writ petition. 3. Heard; Sri. K.Rakesh Roshan, the learned counsel appearing for the petitioner, Sri.Christopher Abraham, the learned Standing Counsel appearing for the respondents 1 to 4 and Smt. Thushara James, the learned Government Pleader appearing for the fifth respondent. 4. Having considered the pleadings and materials on record and taking note of the fact that the petitioner has already invoked the statutory remedy W.P.(C)No.15876/2023 -:4:- before the third respondent by preferring Ext P9 appeal, I am not inclined to invoke the extra ordinary jurisdiction of this Court under Article 226 of the Constitution of India and advert to the contentions now raised in the present writ petition. Nevertheless, I make it clear that, if at all the appeal is to be considered after condoning the delay, the third respondent will have to necessarily advert to all the grounds that have been raised in Ext P9 appeal and dispose of the same in accordance with law. In the result, I dispose of the writ petition as follows: (i) The third respondent shall first consider Ext P10 application filed to condone the delay in preferring Ext P9 appeal, in accordance with law, as expeditiously as possible, at any rate, within a period of 90 days from the date of receipt of a certified copy of this judgment. W.P.(C)No.15876/2023 -:5:- (ii) If Ext P10 application to condone the delay is considered, then the third respondent shall also consider Ext P13 stay petition after adverting to the law laid down by this Court in Archana Agencies vs. Commercial Tax Officer [2014 (2)KLT 715] and decide the same, in accordance with law. (iii) Until such time orders are passed on Exts P10 and P13 applications, all further proceedings pursuant to Ext P8 order shall stand deferred. Sd/- C.S.DIAS,JUDGE DST/23.05.23 //True copy// P .A.To Judge W.P.(C)No.15876/2023 -:6:- APPENDIX PETITIONER EXHIBITS EXHIBIT. P1 TRUE COPY OF THE CERTIFICATE OF REGISTRATION OF THE PETITIONER ISSUED BY THE JOINT REGISTRAR KOZHIKODE DATED 30/3/2005. EXHIBIT.P1(A) TRUE COPY OF THE BY-LAW OF THE PETITIONER SOCIETY . EXHIBIT.P1(B) TRUE ENGLISH TRANSLATION OF THE EXHIBIT.P1(A) BY-LAW. EXHIBIT.P2 TRUE COPY OF THE RETURN FILED BY THE PETITIONER AS MENTIONED ABOVE DATED 16/1/2021 EXHIBIT.P3 TRUE COPY OF THE NOTICE UNDER SECTION 143(2) OF THE INCOME TAX ACT SERVED BY THE 2ND RESPONDENT DATED 29/06/2021. EXHIBIT.P4 TRUE COPY OF THE NOTICE OF THE PROPOSED VARIATION DATED 23/3/2022. EXHIBIT .P5 TRUE COPY OF THE OBJECTION FILED BY THE SOCIETY DATED 25/3/2022. EXHIBIT.P6 TRUE COPY OF THE SHOW CAUSE NOTICE DATED 13/9/2022. EXHIBIT. P7 TRUE COPY OF THE OBJECTION FILED BY THE SOCIETY DATED 23.09.2022. EXHIBIT. P8 TRUE COPY OF THE ASSESSMENT ORDER FOR ADDITIONAL ASSESSMENT OF INCOME AND PENALTY ALONG WITH NOTICE OF DEMAND FOR THE SAME ISSUED UNDER SECTION 156 OF THE INCOME TAX ACT DATED 28/09/2022. EXHIBIT .P9 TRUE COPY OF THE APPEAL FILED BEFORE THE 3RD RESPONDENT ALONG WITH PETITION TO CONDONE THE DELAY DATED 28/11/2022. W.P.(C)No.15876/2023 -:7:- EXHIBIT.P10 TRUE COPY OF THE PETITION FILED BEFORE 4TH RESPONDENT TO KEEP THE EXHIBIT.P8 ORDER IN ABEYANCE DATED 22/11/2022, TILL FINALISATION OF EXT.P9 APPEAL. EXHIBIT.P11 TRUE COPY OF THE SHOW CAUSE NOTICE DATED 25/11/2022. EXHIBIT.P12 TRUE COPY OF THE INTERIM ORDER GRANTED IN W.P(C) NO.12284/2022 DATED 5/4/2022 OBJECTION FILED BY THE PETITIONER. EXHIBIT P-13 TRUE COPY OF THE APPLICATION DATED 31/3/2023 FILED BY PETITIONER FOR STAY OF EXHIBIT P-8 ORDER EXHIBIT P-13(A) TRUE COPY OF THE ACKNOWLEDGMENT FOR SERVICE OF EXHIBIT P-13. EXHIBIT P-14 TRUE COPY OF THE AUDITED FINAL ACCOUNTS OF THE PETITIONER SOCIETY FOR THE YEAR 2019-20 RESPONDENT’S EXHIBITS: NIL "