Anavilasam Service Co-Operative ... vs The Assistant Commissioner Of ...
2021 Latest Caselaw 20394 Ker

              IN THE HIGH COURT OF KERALA AT ERNAKULAM
                              PRESENT
          THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS
      FRIDAY, THE 1ST DAY OF OCTOBER 2021 / 9TH ASWINA, 1943
                      WP(C) NO. 11960 OF 2021
PETITIONER:

          ANAVILASAM SERVICE CO-OPERATIVE BANK LIMITED
          NO.1182, ANAVILASAM SCB BUILDING, ANAVILASAM P.O.,
          MURICKADY, KUMILY, KERALA-685 535, REPRESENTED BY ITS
          SECRETARY, INDIRA.

          BY ADVS.
          ANIL D. NAIR
          R.SREEJITH
          TELMA RAJU
          SANGEETH JOSEPH JACOB
          CHRISTINA ANNA PAUL



RESPONDENT:

          THE ASSISTANT COMMISSIONER OF INCOME TAX
          NATIONAL E-ASSESSMENT CENTRE, DELHI-110 003.

          BY ADV CHRISTOPHER ABRAHAM, INCOME TAX DEPARTMENT




     THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
01.10.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
 WP(C) NO. 11960 OF 2021
                                  2

                BECHU KURIAN THOMAS, J.
                 ----------------------------------------
                     W.P.(C)No. 11960 of 2021
                 ----------------------------------------
              Dated this the 1st day of October, 2021

                           JUDGMENT

Petitioner is a primary agricultural credit society. As an

assessee, petitioner had filed its return for the assessment

year 2018-19 and claimed deduction under section 80P of the

Income Tax Act, 1961 (for short 'the Act'). Though petitioner

was served with notices under section 142(1) of the Act and

appropriate replies were filed to such notices, it is now

complained that the reply filed by the petitioner was not even

referred to, while passing the order of assessment. Petitioner

further contends that though an appeal is available under

section 246A of the Act, failure to consider the reply

submitted by the petitioner amounts to violation of the

principles of natural justice. It is also contended that had the

reply of the petitioner been considered, the nature of the

assessment order could have been different.

2. A statement has been filed on behalf of the WP(C) NO. 11960 OF 2021

respondent stating that the assessment proceedings were

initiated by issue of Ext.P1 notice under section 143(2) of the

Act, which was followed by a notice under section 142(1),

which is produced as Ext.P3, in which several queries were

raised and clarifications sought for, to which the assessee

offered clarifications by Ext.P4. Another notice under section

142(1) of the Act was issued to the petitioner, which was

responded to by Ext.P6 letter which was yet again followed by

Ext.P7 notice under section 142(1) seeking further

explanation on the deduction claimed under section 80P(2)(d)

of the Act. Respondent has also mentioned in the statement

that the assessee had responded to the aforesaid notice by

Ext.P8 letter and attempted to justify the claim of deduction

by producing a copy of the certificate from the Registrar of

Co-operative Societies. According to the respondent, it is

thereafter that the draft assessment order was issued where

the disallowance of the claim under section 80P(2)(d) of the

Act was proposed as per Ext.P9 to which Ext.P10 objection

was filed by the assessee. It was after all these procedures WP(C) NO. 11960 OF 2021

that the assessing officer finalised the assessment order by

issuing Ext.P11 wherein the claim under section 80P(2)(d) of

the Act was disallowed.

3. I have heard the arguments of Adv.Anil D. Nair, the

learned counsel for the petitioner as well as Adv. Christopher

Abraham, the learned Standing Counsel for the respondent.

4. As rightly argued by the learned Standing Counsel for

the respondent, this Court will not interfere normally under

Article 226 of the Constitution of India on orders of

assessment issued by the assessing authorities. It is equally

settled that when there is a violation of the principles of

natural justice, this Court can step in, even against

assessment orders, to avoid the unnecessary travails of an

assessee, in pursuing the statutory remedies.

5. In the instant case, Ext.P9 show cause notice was

issued on 22.03.2021 directing the petitioner to show cause

as to why the assessment should not be completed as per the

draft assessment order. The response of the petitioner was

also sought for in the said show-cause notice. Petitioner's WP(C) NO. 11960 OF 2021

response to Ext.P9 is produced as Ext.P10, wherein it has

raised an objection of some substance, however brief it may

be. Certain documents were also produced along with

Ext.P10. However, while issuing the order of assessment, it is

seen that there is no reference at all to the response

submitted by the petitioner nor is there any consideration of

the document produced along with Ext.P10. Whether the

contentions raised by the petitioner in Ext.P10 or whether the

document produced along with Ext.P10 may have a bearing

upon the case is not a matter which this Court can go into at

this stage. An order of assessment is the foundation on

which the rights of the assessee depend upon. It is

necessary that the assessing authority considers the

objections filed by the petitioner especially when a show-

cause notice in the form of Ext.P9 had been issued, eliciting

the response of the petitioner. Failure to consider the said

response offered by the petitioner in the facts of the case is a

negation of the rights of natural justice. In the said view of

the matter, I find that the order of assessment suffers from WP(C) NO. 11960 OF 2021

the infirmity of violation of the principles of natural justice

and is liable to be set aside.

Accordingly, I set aside Ext.P11 assessment order dated

19-04-2021 issued by the respondent and direct the

respondent to consider and pass fresh orders for the

assessment year 2018-19, relating to the petitioner, after

affording an opportunity of hearing to the petitioner, as

expeditiously as possible, and untrammelled by any of the

observations of this Court in this judgment. The decision as

aforesaid shall be taken within an outer time limit of 60 days

from today.

The writ petition is allowed as above.

Sd/-

BECHU KURIAN THOMAS JUDGE

AJ/01.10.2021 WP(C) NO. 11960 OF 2021

APPENDIX OF WP(C) 11960/2021

PETITIONER EXHIBITS

Exhibit P1 TRUE COPY OF NOTICE DATED 22.09.2019.

Exhibit P2 TRUE COPY OF THE REPLY TO THE NOTICE DATED 07.10.2019.

Exhibit P3 TRUE COPY OF NOTICE DATED 01.12.2020.

Exhibit P4 TRUE COPY OF THE REPLY TO THE NOTICE DATED 15.12.2020.

Exhibit P5 TRUE COPY OF NOTICE DATED 16.02.2021.

Exhibit P6 TRUE COPY OF THE REPLY TO THE NOTICE DATED 01.03.2021.

Exhibit P7 TRUE COPY OF NOTICE DATED 08.03.2021.

Exhibit P8 TRUE COPY OF THE REPLY TO THE NOTICE DATED 13.03.2021 ALONG WITH THE CERTIFICATES.

Exhibit P9 TRUE COPY OF NOTICE DATED 22.03.2021.

Exhibit P10 TRUE COPY OF THE REPLY TO THE NOTICE 26.03.2021.

Exhibit P11 TRUE COPY OF THE ORDER DATED 19.04.2021.

Exhibit P12 TRUE COPY OF THE JUDGMENT OF THE HON'BLE SUPREME COURT DATED 12.01.2021.