9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (7) TMI 1105 - HC - Income TaxStay of demand - Recovery proceedings - Deduction u/s 80P denied - Assessing Officer has communicated to the petitioners that the petitioners should pay 20% of the demand and then apply for stay of demand -HELD THAT - In the matter of Mavilayi Service Co-operative Bank Ltd. 2019 (3) TMI 1580 - KERALA HIGH COURT the question regarding liability of the co-operative societies to pay the income tax assess was decided. The Division Bench of this Court relying on the said judgment in THE ANGADIPPURAM SERVICE CO-OPERATIVE BANK 2019 (7) TMI 375 - KERALA HIGH COURT , has quashed the action on the part of respondents with the direction that the Commissioner of the Income Tax should consider and dispose of the statutory appeals filed by the appellant co-operative societies at the earliest taking note of Full Bench decision in the matter of Mavilayi Service Co-operative Bank Ltd. and till then the recovery and collection of taxes should be kept in abeyance In this view of the matter, in the light of ratio of judgment of this Court, in the matter of The Angadipuram Service Co-operative Bank Ltd. v. The Commissioner of Income Tax (Appeals), the writ petitions are allowed. The 2nd respondent is directed to decide the pending appeals expeditiously and till then the respondents are directed to keep the recovery proceedings pursuant to the assessment order in abeyance.
Issues:
1. Entitlement of co-operative banks to benefits under Section 80(P) of the Income Tax Act. 2. Legality of demanding payment during pendency of statutory appeals. 3. Compliance with court judgments regarding co-operative societies' tax liability. Analysis: Issue 1: The petitioners, co-operative banks, claimed entitlement to benefits under Section 80(P) of the Income Tax Act. The Assessing Officer denied this benefit, leading to the petitioners challenging the assessment order by filing statutory appeals. The core issue was whether co-operative societies are eligible for deduction under Section 80(P) of the Income Tax Act. The court referred to the judgment in the case of Mavilayi Service Co-operative Bank Ltd., which addressed the liability of co-operative societies to pay income tax. Previous judgments by the Division Bench and Single Judge had quashed actions denying such benefits, emphasizing the need for the Commissioner of Income Tax to consider and dispose of statutory appeals promptly, in line with the Full Bench decision in the Mavilayi case. Issue 2: The petitioners objected to the Assessing Officer's directive for payment of 20% of the demand during the pendency of appeals, arguing it contradicted the Supreme Court's ruling in Mavilayi case. The court reiterated that recovery and collection of taxes should be kept in abeyance until the appeals are decided, as established in previous judgments like the one involving the Electricity Board Employees Co-operative Society Ltd. The court emphasized compliance with its rulings to ensure fair treatment of co-operative societies in tax matters. Issue 3: In light of the legal precedents and the court's interpretation of the Mavilayi case, the writ petitions were allowed. The court directed the 2nd respondent to expedite the pending appeals and instructed the respondents to halt recovery proceedings based on the assessment order until a decision is reached. The judgment in The Angadipuram Service Co-operative Bank Ltd. case was cited to support this directive, ensuring consistency in the treatment of co-operative societies regarding tax benefits and liabilities.
|
