Case Law Details
Kadavalloor Service Co-Operative Bank Ltd. Vs ITO (Kerala High Court)
Introduction: In the case of Kadavalloor Service Co-Operative Bank Ltd. vs. ITO, the Kerala High Court addressed writ petitions filed by an Agricultural Credit Co-operative Society under Article 226 of the Constitution of India. The petitions challenged assessment orders and the initiation of penalty proceedings by the Income Tax Department. The court’s decision and order are presented below.
Assessment Orders: The petitioner, an Agricultural Credit Co-operative Society, had received assessment orders under Section 144 of the Income Tax Act, 1961, for the assessment year 2008-2009 (W.P.(C.) No.31648/2023) and under Section 143(3) for the assessment year 2010-11 (W.P.(C.) No.31660/2023).
Penalty Proceedings: In addition to the assessment orders, penalty proceedings were initiated under Sections 271F, 271B, and 271(1)(C).
Appellate Process: The petitioner challenged the assessment orders before the Commissioner of Income Tax Appeals, but the appeals were dismissed. Subsequently, the petitioner filed appeals under Section 253 before the Income Tax Appellate Tribunal (ITAT) for both assessment years.
Garnishee Notices: The petitioner’s appeals to the ITAT did not result in the grant of any interim orders. As a result, garnishee notices were issued by the Income Tax Department, leading to the attachment of the petitioner’s bank account held at the State Bank of India.
Tax Realization: The State Bank of India remitted an amount of Rs. 27,77,170 in response to the garnishee notices issued by the Department.
Conclusion: The Kerala High Court, in light of the tax amount already realized from the petitioner’s bank account, declined to direct a refund of the tax amount. Instead, the court issued a directive to the Income Tax Appellate Tribunal, urging the expedited disposal of pending appeals filed by the petitioner. The court emphasized that these appeals should ideally be resolved within three months from the date of receiving a copy of the judgment. This decision underscores the importance of timely and efficient handling of tax-related appeals by relevant authorities.
FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT
These writ petitions have been filed under Article 226 of the Constitution of India by the petitioner, an Agricultural Credit Co-operative Society. Ext.P1 assessment order dated 31.12.2015 in W.P.(C.) No.31648/2023 was passed regarding the income of the petitioner for the assessment year 2008-2009 under Section 144 of the Income Tax Act, 1961. The petitioner’s total income was assessed as Rs.1,15,140/-. Therefore, penalty proceedings under Sections 271F, 271B and 271(1) (C) was separately initiated.
2. In W.P.(C.) No.31660/2023 Ext.P1 order was passed on 19.11.2018 under Section 143(3) read with Section 147 for the assessment year 2010-11, assessing the the petitioner’s total income was assessed as Rs.30,08,820/- on which tax and interest as Rs.26,87,180/- were levied. The petitioner challenged the assessment orders before the Commissioner of Income Tax Appeals. The Appellate Authority has dismissed the appeals. Against the dismissal of the same, petitioner has filed appeals under Section 253 before the Income Tax Appellate Tribunal as Exts.P5 and P6 in respect of the assessment year 2008-9 and 2010-11 respectively. However, the petitioner has not been granted any interim order and garnishee notices were issued by the Department and the petitioner’s bank account in the State Bank of India was attached.
3. Learned Standing Counsel for the State Bank of India submits that the bank has already remitted an amount of Rs.27,77,170/- in respect of the garnishee notices to the Department in respect of both assessment years.
4. Considering the fact that the tax amount has already been realised from the account of the petitioner maintained in the State Bank of India, this Court cannot direct to refund of the tax amount and therefore, the present writ petitions are disposed of with a direction to the Income Tax Appellate Tribunal to dispose of the pending appeals filed by the petitioner, expeditiously, preferably within a period of three months from the date of receipt of a copy of this judgment.
