The Kerala High Court quashed a rectification application filed by the Income Tax Department with a delay of 6 months.
The present writ petition has been filed by the petitioner, M/s Ramanthali Service Co-operative Bank Ltd, impugning the order passed by the Income Tax Appellate Tribunal, Cochin Bench, filed under Section 254(2) of the Income Tax Act, 1961 seeking rectification of the order in respect of the assessment years 2009-2010.
The petitioner is a co-operative society. The assessing officer has passed the order for the assessment years 2009-2010 assessing the tax liability at Rs. 10,64,549/- and initiating penalty proceedings under Sections 271F, 271B, 271(1)(b) and 271(1)(c) of the Income Tax Act separately against the petitioner. Challenging the same, the petitioner has filed an appeal before the first appellate authority, who as per order, dismissed the same.
Against the said order, the petitioner has filed a second appeal before the Income Tax Appellate Tribunal, Cochin Bench and the Tribunal, as per the order, allowed the appeal in part holding that the petitioner, being a co-operative society, is eligible for deduction under Section 80P(2) of the Income Tax Act, 1961 and the assessing officer was directed to grant the deduction claimed by the petitioner.
The counsel for the petitioner submitted that those applications were filed beyond the limitation period prescribed under Section 254(2) of the Income Tax Act, 1961 and therefore, the same were not maintainable under law. The application for rectification in respect of the petitioner is dated 30.09.2019, which is much beyond the period of limitation of six months provided for filing such an application.
The counsel for the petitioner also submitted that the aforesaid Full Bench judgment has been set aside by the Apex Court and therefore, the application filed by the Department seeking rectification of the order was barred by limitation. Even otherwise, the Department was seeking review of the order of the Income Tax Appellate Tribunal and there is no provision in the Act, 1961 to review the order passed by the Income Tax Appellate Tribunal.
A Single Bench of Justice Dinesh Kumar Singh observed that “In view of the above, I find that the application filed by the Department seeking rectification of the order dated 14.03.2017 in respect of the petitioner was not maintainable and it was filed much beyond the six months’ period of limitation prescribed under Section 254(2) of the Income Tax Act, 1961.”
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