High Court of KeralaSingle Judge2023-09-08Writ petitions disposed of; liberty to file ret...

WP(C) Nos.15059/2023, 15154/2023, 15167/2023 (Muvattupuzha Housing Co-Operative Society Ltd; Puthencruz Govt. Servant's Co-Operative Society Ltd; Koothattukulam Farmers Service Co-Operative Bank Ltd v. Income Tax Department)

Case / Petition Number:WP(C) Nos.15059/2023, 15154/2023, 15167/2023

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: Dinesh Kumar Singh
Judgment Date: 2023-09-08
Court Decision / Holding: The writ petitions are disposed of with liberty to the petitioners to file returns of income within one month from the date of the order. If such returns are filed, the assessing authority shall examine them in accordance with law and pass final assessment orders expeditiously.
Final Disposition: Writ petitions disposed of; liberty to file returns within one month; if returns filed, final assessment orders to be passed expeditiously; matter resolved for the time being.

Parties to the Case

Appellants / Petitioners

Muvattupuzha Housing Co-Operative Society Ltd, E 299, Kavumpady, Muvattupuzha P.O, Ernakulam, PIN 686661
Puthencruz Govt. Servant's Co-Operative Society Ltd, No. E 153, Puthencruz P.O, Ernakulam, COCHIN -682308
Koothattukulam Farmers Service Co-Operative Bank Ltd, E 45, Koothattukulam P.O, Ernakulam -PIN-686662

Respondents

Income Tax Officer, Ward 1 & TPS, Thodupuzha, Temple Road, Thodupuzha, IDUKKI, PIN 685584
Principal Chief Commissioner, CR Building, I S Press Road, Ernakulam, Cochin, PIN 682018

Legal Representation & Advocates

Counsels for Petitioners

• C.A. Jojo

Counsels for Respondents

• Christopher Abraham

Case Synopsis & Summary

The three connected writ petitions challenge notices issued under Section 148 of the Income Tax Act, 1961 and the ensuing proceedings for the Assessment Year 2019-20 against three cooperative societies registered under the Kerala Co-operative Societies Act, 1969. The petitioners did not file returns for 2019-20 on the belief that their total income was exempt under Section 80P, and thus not taxable. The Income Tax Department contends that the petitioners concealed income and thus warranted scrutiny, issuing notices under Section 148A and taking subsequent steps. After hearing, counsel for the petitioners urged disposal with liberty to file the returns and to raise all legal pleas, including the 80P exemption. The court acceded to this request and disposed of the petitions by directing the petitioners to file their returns within one month. If returns are filed, the assessing authority is to examine the returns in accordance with law and pass final assessment orders expeditiously. The order preserves the petitioners’ substantive arguments related to 80P while ensuring due process and a prompt reinitiation of assessment. The petitions are finally disposed of with liberty to pursue the appropriate remedies under the statute.

Provisions of Law Cited

Income Tax Act, 1961 – Section 148Income Tax Act, 1961 – Section 148A(B)Income Tax Act, 1961 – Clause (D) of Section 148AKerala Co-operative Societies Act, 1969

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioners submit that their entire income for AY 2019-20 is exempt under Section 80P of the IT Act, hence they were not liable to file a return. They challenge the notices issued under Section 148A and the ensuing assessment proceedings, and seek liberty to file returns and raise all pleas available under law, including the 80P claim. They contend the notices are without valid basis given the exemption claimed and urge a remedy that preserves their statutory rights.

Contentions of Respondents

The respondents contend that notices under Section 148A were issued after due process in response to perceived concealment of income. They argue that the petitioners are subject to the normal reassessment process and that the court should allow the authorities to proceed under the statutory framework, subject to law. The pleadings emphasize the necessity of a lawful reassessment if the facts justify it.

Cited Precedents (3)

Case Name	Citation	Treatment	Explanation
Anshul Jain v. Principal Commissioner of Income Tax and another	[2022] 449 ITR 256 (SC)	Mentioned Only	Exhibited as R1(a); the judgment is referenced in the respondent exhibits but not analyzed in the reasoning of the present decision.
Anshul Jain v. Principal Commissioner of Income Tax	[2022] 449 ITR 251 (P&H)	Mentioned Only	Exhibited as R1(b); cited for background but not discussed in detail in the judgment.
Viswabharathi Medicals v. Income Tax Officer	W.P.(C) No. 37527 of 2022 (Kerala HC)	Mentioned Only	Exhibited as R1(c); used as supporting material without explicit treatment in the decision.

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Extracted Judgment Text

Exact text extracted from official judgment records.

IN THE HIGH COURT OF KERALA AT ERNAKULAM ## PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH FRIDAY, THE 8[TH] DAY OF SEPTEMBER 2023 / 17TH BHADRA, 1945 ## WP(C) NO. 15059 OF 2023 ## PETITIONER/S: THE MUVATTUPUZHA HOUSING CO-OPERATIVE SOCIETY LTD E 299, KAVUMPADY, MUVATTUPUZHA P.O, ERNAKULAM, REPRESENTED BY ITS SECRETARY, PIN - 686661 BY ADV C.A.JOJO ## RESPONDENT/S: - 1 THE INCOME TAX OFFICER, WARD 1 & TPS, THODUPUZHA, TEMPLE ROAD, THODUPUZHA, IDUKKI, PIN - 685584 - 2 THE PRINCIPAL CHIEF COMMISSIONER, C R BUILDING, I S PRESS ROAD, COCHIN, PIN - 682018 BY ADV CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08.09.2023, ALONG WITH WP(C).15154/2023, 15167/2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ## **W.P.(C) Nos.15059/2023, 15154/2023, 15167/2023** **-2-** IN THE HIGH COURT OF KERALA AT ERNAKULAM ## PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH FRIDAY, THE 8[TH] DAY OF SEPTEMBER 2023 / 17TH BHADRA, 1945 ## WP(C) NO. 15154 OF 2023 ## PETITIONER/S: PUTHENCRUZ GOVT.SERVANT'S CO-OPERATIVE SOCIETY LTD, NO. E 153, PUTHENCRUZ P.O, ERNAKULAM, COCHIN -682308, REPRESENTED BY ITS SECRETARY BY ADV C.A.JOJO ## RESPONDENT/S: - 1 THE INCOME TAX OFFICER, NON CORP WARD 1(1), KOCHI, C. R. BUILDING, I.S PRESS ROAD COCHIN-682018 - 2 THE PRINCIPAL CHIEF COMMISSIONER, C R BUILDING, I S PRESS ROAD, ERNAKULAM COCHIN, PIN - 682018 BY ADV CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT ## OTHER PRESENT: ## CHRISTOPHER ABRAHAM-SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08.09.2023, ALONG WITH WP(C).15059/2023 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: **W.P.(C) Nos.15059/2023, 15154/2023, 15167/2023** **-3-** IN THE HIGH COURT OF KERALA AT ERNAKULAM ## PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH FRIDAY, THE 8[TH] DAY OF SEPTEMBER 2023 / 17TH BHADRA, 1945 WP(C) NO. 15167 OF 2023 ## PETITIONER/S: KOOTHATTUKULAM FARMERS SERVICE CO-OPERATIVE BANK LTD, E 45, KOOTHATTUKULAM P.O, ERNAKULAM -PIN-686662 REPRESENTED BY ITS MANAGING DIRECTOR. BY ADV C.A.JOJO ## RESPONDENT/S: - 1 THE INCOME TAX OFFICER,WARD 1 & TPS, THODUPUZHA, TEMPLE ROAD, THODUPUZHA, IDUKKI, PIN -685584 - 2 THE PRINCIPAL CHIEF COMMISSIONER,C R BUILDING, I S PRESS ROAD, ERNAKULAM, COCHIN, PIN – 682018 BY ADV CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08.09.2023, ALONG WITH WP(C).15059/2023 AND CONNECTED CASES, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: **W.P.(C) Nos.15059/2023, 15154/2023, 15167/2023** **-4-** ## J U D G M E N T [WP(C) Nos.15059/2023, 15154/2023, 15167/2023] The present writ petitions have been filed impugning the notices issued under Section 148 of the Income Tax Act 1961 and further proceedings taken pursuant to the notices issued for the Assessment Year 2019-20. 2. The petitioners are Co-operative Societies registered under the provisions of the Kerala Co-operative Societies Act 1969 and Rules made thereunder. The petitioners did not file the return of their income for the Assessment Year 2019-20 on the belief that the petitioners' entire income was exempt under Section 80P of the Income Tax Act, and, therefore, they were not required to file the return of their income. 3. The assessing authority believes that the petitioners have concealed their income and tried to escape the assessment. The petitioners were therefore issued notices ## **W.P.(C) Nos.15059/2023, 15154/2023, 15167/2023** **-5-** under Section 148A, and after considering their response, the orders in Ext.P3 were passed for proceeding against them. In response to the orders passed under Section 148 of the Income Tax Act, the petitioners have not filed their return of income. 4. After some argument, the learned Counsel for the petitioners submits that these petitions may be disposed of with liberty to the petitioners to file the return of income and take all the pleas which are available to them under the law in respect of their claim for their income being jumped under Section 80P of the Income Tax Act. 5. Considering the said submission, the present writ petitions are disposed of with liberty to the petitioners to file returns of their income within a period of one month from today. If the petitioners file their return of income within a period of one month from today, the assessing authority will examine the return in accordance with the law and pass the final assessment orders expeditiously. **W.P.(C) Nos.15059/2023, 15154/2023, 15167/2023** **-6-** With the aforesaid direction, the writ petitions stand finally disposed of. Sd/- DINESH KUMAR SINGH JUDGE jjj ## **W.P.(C) Nos.15059/2023, 15154/2023, 15167/2023** **-7-** APPENDIX OF WP(C) 15154/2023 - PETITIONER EXHIBITS Exhibit P1 A TRUE COPY OF THE NOTICE U/S 148A(B) DATED 08.02.2023 ISSUED BY THE 1ST RESPONDENT - Exhibit P2 A TRUE COPY OF THE REPLY SUBMITTED TO THE 1ST RESPONDENT DATED 14.02.2023 - Exhibit P3 A TRUE COPY OF THE ORDER UNDER CLAUSE (D) OF S.148A DATED 22.03.2023 ISSUED THE 1ST RESPONDENT - Exhibit P4 A TRUE COPY OF THE STATUS QUO ORDER IN WP ( C) 24112 OF 2019 DATED 04.09.2019 - Exhibit P5 A TRUE COPY OF THE STAY ORDER IN WP ( C) 4368 OF 2023 DATED 12.04.2023 - RESPONDENT EXHIBITS - Exhibit R1(a) copy of the Supreme Court judgment dated 02.09.2022 in the case of anshul Jain v. Principal Commissioner of Income tax and another [2022] 449 ITR 256 (SC) - Exhibit R1 (b) Copy of the judgment of the Punjab and Haryana High Court in the case of Anshul Jain v. Principal Commissioner of Income Tax dated 02.06.2022 [2022] 449 ITR 251 (P and H) Exhibit R1(c) Copy of the judgment of the Kerala High Court dated 07.12.2022 in W.P. (C) No. 37527 of 2022 in the case of M/s Viswabharathi Medicals v. Income Tax Officer ## **W.P.(C) Nos.15059/2023, 15154/2023, 15167/2023** **-8-** APPENDIX OF WP(C) 15167/2023 - PETITIONER EXHIBITS - Exhibit P1 - A TRUE COPY OF THE LETTER DATED 30.01.2023 ISSUED BY THE 1ST RESPONDENT - Exhibit P2 A TRUE COPY OF THE REPLY SUBMITTED TO THE 1ST RESPONDENT DATED 10.02.2023 Exhibit P3 A TRUE COPY OF THE NOTICE U/S 148A(B) DATED 28.02.2023 ISSUED BY THE 1ST RESPONDENT - Exhibit P4 THE RELEVANT PAGE OF COPY OF THE AUDITED BALANCE SHEET AND PROFIT AND LOSS STATEMENT OF THE PETITIONER FOR FY 2018-19 DATED 23.09.2019 - Exhibit P5 A TRUE COPY OF THE STATUS QUO ORDER IN WP ( C) 24112 OF 2019 DATED 04.09.2019 - Exhibit P6 A TRUE COPY OF THE STAY ORDER IN WP ( C) 4368 OF 2023 DATED 12.04.2023 - RESPONDENT EXHIBITS - Exhibit R1(a) Copy of the Supreme Court judgment dated 02.09.2022 in the case of Anshul Jain v. Principal Commissioner of Income Tax and another [2022] 449 ITR 256 (SC) - Exhibit R1 (b) Copy of the judgment of the Punjab and Haryana High Court in the case of Anshul Jain v. Principal Commissioner of Income Tax dated 02.06.2022 [2022] 449 ITR 251 (Pand H) - Exhibit R1(c) Copy of the judgment of the Kerala High Court dated 07.12.2022 in W.P.(C). No.37527 of 2022 in the case of m/s Viswabharathi Medicals v. Income Tax Officer - Exhibit R1(d) True copy of the order dated 23.03.2023 passed under clause (d) of section 148A of the Income Tax Act. - Exhibit R1(e) True copy of notice under section 148 of the Income Tax Act dated 27.03.2023 calling for return of income for Assessment Year 2019-20 **W.P.(C) Nos.15059/2023, 15154/2023, 15167/2023** **-9-** ## APPENDIX OF WP(C) 15059/2023 PETITIONER EXHIBITS Exhibit P1 A TRUE COPY OF THE NOTICE U/S 148A(B) DATED 02.03.2023 ISSUED BY THE 1ST RESPONDENT Exhibit P2 A TRUE COPY OF THE REPLY SUBMITTED TO THE 1ST RESPONDENT DATED 10.02.2023 - Exhibit P3 A TRUE COPY OF THE ORDER UNDER CLAUSE (D) OF S.148A DATED 25.03.2023 ISSUED THE 1ST RESPONDENT - Exhibit P4 A TRUE COPY OF THE NOTICE U/S S.148 DATED 2703.2023 ISSUED THE 1ST RESPONDENT - Exhibit P5 A TRUE COPY OF THE STATUS QUO ORDER IN WP ( C) 24112 OF 2019 DATED 04.09.2019 - Exhibit P6 A TRUE COPY OF THE STAY ORDER IN WP ( C) 4368 OF 2023 DATED 12.04.2023 - RESPONDENT EXHIBITS - Exhibit R1(a) Copy of the Supreme Court decision dated 02.09.2022 in the case of Anshul Jain v Principal Commissioner of Income Tax and Another {2022} 449 ITR 256 (SC) - Exhibit R1 (b) Copy of the Judgment of the Punjab and Haryana High Court in the case of Anshul Jain v. Principal Commissioner of Income Tax dated 02.06.2022, [2022] 449 ITR 251 (P and H) Exhibit R1(c) Copy of the Judgment of the Kerala High Court dated 07.12.2022 in W.P.(C) No. 37527 of 2022 in the case of M/s Viswabharathi Medicals v. Income Tax Officer