Porkulam Service Co-Operative Bank Limited Vs Principal Chief Commissioner of Income Tax (Kerala High Court)
n a recent judgment that has caught the attention of the tax community, the Kerala High Court has set a precedent by ordering a fresh decision in the case of Porkulam Service Co-Operative Bank Limited Vs Principal Chief Commissioner of Income Tax. This ruling underscores the importance of due process and the need for authorities to consider all submissions made by taxpayers before making a decision.
Background of the Case
Porkulam Service Co-Operative Bank Limited, a Primary Agricultural Credit Society registered under the Kerala Co-operative Societies Act, 1969, engaged in banking and providing credit facilities exclusively to its members, found itself in a legal tangle over the delay in filing its income tax return. The bank filed its return seven days past the deadline and subsequently applied for condonation of delay under Section 119(2)(b) of the Income Tax Act.
The Oversight
The Principal Chief Commissioner of Income Tax, Kerala, issued a notice for a hearing on the application for condonation of the delay. The bank was given the opportunity to appear in person or through an authorised representative and was encouraged to file written submissions for consideration. Complying with this, the bank submitted its written arguments on November 3, 2023. However, the impugned order passed by the Principal Chief Commissioner overlooked these submissions, stating that the bank neither appeared in person nor submitted any written representation, an assertion that was factually incorrect.
