Kerala High Court
The Ottoor Service Co-Operative Bank ... vs The Income Tax Officer on 26 September, 2014
Author: P.B.Suresh Kumar
Bench: P.B.Suresh Kumar
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR. JUSTICE P.B.SURESH KUMAR
THURSDAY, THE 21ST DAY OF DECEMBER 2017/30TH AGRAHAYANA, 1939
WP(C).No. 38566 of 2017 (U)
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PETITIONER(S):
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THE OTTOOR SERVICE CO-OPERATIVE BANK LTD NO. 976,
REPRESENTED BY ITS SECRETARY,
CHENNANKODE,
VADASSERIKONAM P.O, VARKALA,
THIRUVANANTHAPURAM DISTRICT.
BY ADV. SRI.V.G.ARUN
RESPONDENT(S):
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1. THE INCOME TAX OFFICER,
WARD -2(3),
OFFICE OF THE JOINT COMMISSIONER OF INCOME TAX,
RANGE-2,AAYAKAR BHAVAN, KOWDIAR P.O,
THIRUVANANTHAPURAM DISTRICT 695 003.
2. THE COMMISSIONER OF INCOME TAX (APPEALS),
AAYAYAKAR BHAVAN, KOWDIAR,
THIRUVANANTHAPURAM 695 003.
BY ADVS.SRI.K.M.V.PANDALAI
SRI.CHRISTOPHER ABRAHAM,
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD
ON 06.12.2017, THE COURT ON 21.12.2017, DELIVERED THE
FOLLOWING:
TS
WP(C).No. 38566 of 2017 (U)
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APPENDIX
PETITIONER(S)' EXHIBITS
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EXHIBIT P1 A TRUE COPY OF THE CERTIFICATE DATED 26-09-2014,ISSUED BY
THE ASSISTANT REGISTRAR OF CO-OPERATIVE
SOCIETIES(GENERAL), CHIRAYINKEEZHU
EXHIBIT P2 A TRUE COPY OF THE ASSESSMENT ORDER FOR
THE YEAR 2013-2014 DATED 25-01-2016
EXHIBIT P3 A TRUE COPY OF THE NOTICE ISSUED BY THE 1ST RESPONDENT
DATED 25-01-2016
EXHIBIT P4 A TRUE COPY OF THE NOTICE
NO.AAA00619E/ITO,W-2(5)/TVM/2017-18 DATED 25-08-2017 ISSUED
BY THE 1ST RESPONDENT
EXHIBIT P5 A TRUE COPY OF THE JUDGMENT
DATED 25-09-2017 IN WP(C) NO 30493 OF 2017
EXHIBIT P6 A TRUE COPY OF THE ORDER DATED 13-11-2017 IN ITA
NO.145/TVM/CIT(/(A),TVM/2015-16 ISSUED BY THE 2ND
RESPONDENT
RESPONDENT(S)' EXHIBITS - NIL
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/TRUE COPY/
PS TO JUDGE
TS
P.B.SURESH KUMAR, J.
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W.P.(C).No.38566 of 2017
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Dated this the 21st day of December, 2017
JUDGMENT
Petitioner is a Primary Agricultural Credit Society registered under the Kerala Co-operative Societies Act. The petitioner is an assessee under the Income Tax Act (the Act) on the rolls of the first respondent. The assessment of the petitioner for the year 2013-2014 has been completed by the first respondent under Section 143 of the Act, in terms of Ext.P2 order determining the income of the petitioner at Rs.1,22,36,746/- against the nil income returned by the petitioner and raising a demand for tax to the tune of Rs.51,00,400/-. Aggrieved by Ext.P2 W.P.(c).No.38566 of 2017 : 2 : order, the petitioner preferred ITA No.145/TVM/CIT/(A), TVM/2015-16 before the second respondent along with an application for stay. The application for stay preferred by the petitioner in the appeal has now been disposed of by the second respondent as per Ext.P6 order, staying realisation of 50% of the tax demand, pending disposal of the appeal. Ext.P6 order is under challenge in the writ petition.
2. Heard the learned counsel for the petitioner as also the learned Standing Counsel for the respondents.
3. In the assessment order, the Assessing Officer has rejected the claim of the petitioner for deduction made under Section 80P(2)(a)(i) of the Act, apart from treating a portion of the interest income earned by the petitioner from their surplus fund deposited by the District Co-operative Banks, Treasuries etc. as income from other sources. According to the petitioner, in the light of decision of this Court in Chirakkal Service Co-operative Bank Ltd v. Commissioner of Income Tax [2016 (2) KLT 535], they W.P.(c).No.38566 of 2017 : 3 : were entitled to deduction under Section 80P(2)(a)(i) of the Act. As regards the interest income earned from the surplus funds deposited by the District Co-operative Banks, Treasuries etc, the case of the petitioner is that the said income was also eligible for deduction under Section 80P(2)
(d) of the Act. The second respondent accepted the case of the petitioner that they are entitled to deduction under Section 80 P (2) (a) (i) of the Act and rejected the case set up by them as regards the interest income. It is on that basis, the demand was stayed to the extent of 50%.
4. It appears prima facie to this Court, in the light of the provision contained in Section 80 P (2) (d) of the Act that the interest income of the petitioner is not liable to tax. In the said view of the matter, according to me, the petitioner is entitled to an absolute stay in the matter.
In the result, the writ petition is allowed. The impugned order is modified granting the petitioner absolute stay for realisation of the amount covered by Ext.P2 order, W.P.(c).No.38566 of 2017 : 4 : pending disposal of the appeal in which Ext.P6 order is passed.
Sd/-
P.B.SURESH KUMAR JUDGE rsr