IN HIGH COURT OF JUDICATURE AT MADRAS DATED :18.07.2019 CORAM HON'BLE MR.JUSTICE M.SUNDAR W.P.No.4448 of 2019 and W.M.P.Nos.5014 & 5016 of 2019 M/s.K274 Uthukuli Primary Agricultural Cooperative Credit Society Limited Represented by its Secretary 1, Uttukuli Post, Uttukuli, Thirupur 638 751 PAN : AABAK4347E ..Petitioner vs Income Tax Officer, Ward 1(3), Income Tax Officer, No.121, Adam Building, Sixty Feet Road, Tirupur 641 602 ..Respondent Prayer: Writ Petition filed under Article 226 of Constitution of India praying to issue Writ of Certiorari, call for records of Respondent herein in Order No.ITBA/AST/S/143(3)/2018- 19/1014632062(1) passed by respondent for Assessment Year 2016-17 and quash Order dated 24.12.2018 passed therein and pass any such further or other orders as this Hon'ble Court may deem fit and proper in circumstances of case and thus render justice. For Petitioner : Mr.B.Raveendran For Respondent : Mr.A.N.R.Jayaprathap Junior Standing counsel (Income Tax) http://www.judis.nic.in 2 ORDER Mr.B.Raveendran, learned counsel on record for writ petitioner and Mr.A.N.R.Jayaprathap, learned Junior Standing counsel (Income Tax) on behalf of lone official respondent are before this Court. 2. With consent of learned counsel on both sides, main writ petition is taken up and is being disposed of. 3. Owing to nature of trajectory which hearing has taken today, entire writ petition now turns on very narrow compass. Therefore, it may not be necessary to set out facts in great detail. 4. Suffice to say that writ petitioner is Primary Agricultural Cooperative Credit Society, registered under 'Tamil Nadu Cooperative Societies Act, 1983' ['TNCS Act' for brevity] 5. instant writ petition has been filed, assailing order dated 28.12.2018 made by lone official respondent and this order bears reference Order No:ITBA/AST/S/143(3)/2018- 19/1014632062(1). This order 'dated 28.12.2018 bearing reference Order No:ITBA/AST/S/143(3)/2018-19/1014632062(1)', shall http://www.judis.nic.in 3 hereinafter be referred to as 'impugned order'. To be noted, impugned order is assessment order, pertaining to Assessment Year 2016-17 qua writ petitioner and impugned order has been made by lone official respondent under Section 143(3) of 'Income Tax Act, 1961' ['IT Act' for brevity] 6. pivotal submission is that writ petitioner being Cooperative Society, is entitled to various deductions enlisted / adumbrated under Section 80P of IT Act. That Cooperative Societies akin to writ petitioner, which are registered under TNCS Act are entitled to claim deductions under various heads adumbrated under Section 80P of IT Act has been laid down by this Court in Commissioner of Income Tax, Salem Vs. Tiruchengode Agricultural Producers Cooperative Marketing Society Ltd., [hereinafter 'Tiruchengode Agricultural Producers Cooperative Marketing Society case' for brevity] vide order dated 02.08.2016 made in Tax Case Appeal Numbers.484 to 487 and 490 of 2016. 'Tax Case Appeals' shall be referred to as 'TCAs' in plural and 'TCA' in singular for sake of brevity. 7. aforesaid Tiruchengode Agricultural Producers Cooperative Marketing Society case was rendered by Hon'ble http://www.judis.nic.in 4 Division Bench of this Court based on Veerakeralam Primary Agricultural Co-operative Credit Society principle being principle laid down by another Hon'ble Division Bench vide judgment in Commissioner of Income Tax Vs. M/s. Veerakeralam Primary Agricultural Co-operative Credit Society dated 05.07.2016 made in TCA Nos.735, 755 of 2014 and 460 of 2015 [hereinafter 'Veerakeralam Primary Agricultural Co-operative Credit Society principle' for brevity]. 8. In aforesaid cases, Hon'ble Division Bench addressed itself to question as to whether Primary Agricultural Societies carrying on business of providing credit facilities to its members are entitled to claim deductions under Section 80P of IT Act and same was answered in affirmative. 9. Reverting to case on hand, perusal of impugned order reveals that it turns on two heads which as set out in impugned order reads as follows: '(i) Large deduction under chapter VI-A from Total Income. (ii) Low income in comparison to high loans / advances / Investment in shares appearing in balance sheet.' http://www.judis.nic.in 5 10. With regard to (i) supra, as Hon'ble Division Bench of this Hon'ble Court has already held that Cooperative Societies akin to writ petitioner are entitled to claim deductions under various heads adumbrated under Section 80P of IT Act, same does not survive. However, this Court is informed that Income Tax Department is carrying both Tiruchengode Agricultural Producers Cooperative Marketing Society case and Veerakeralam Primary Agricultural Co- operative Credit Society orders in TCAs to Hon'ble Supreme Court. On this basis, this Court has passed order dated 27.06.2019 in W.P.No.2552 of 2019 & etc., batch interalia to effect that this question is subject to outcome of Special Leave Petitions said to have been filed by department. To be noted, this aforesaid order dated 27.06.2019 in W.P.No.2552 of 2019 & etc., batch came to be passed by this Court as that was lone issue therein, but in instant case, that issue is dovetailed with another issue namely (ii) supra. 11. In aforesaid backdrop, learned counsel for writ petitioner submitted that writ petitioner will opt for alternate remedy of statutory appeal with regard to those aspects of impugned order excluding aforesaid issue, which is covered by Veerakeralam http://www.judis.nic.in 6 Primary Agricultural Co-operative Credit Society and Tiruchengode Agricultural Producers Cooperative Marketing Society principles. 12. This takes us to alternate remedy aspect. Alternate remedy is available to writ petitioner by way of appeal under Section 246A of IT Act. 13. There is time limit of 30 days prescribed for preferring appeal under Section 246A of IT Act, which lies to Commissioner (Appeals). 14. At request of writ petitioner, time that has been spent in instant writ petition i.e., time from date of filing of instant writ petition to date on which this order is made available shall stand excluded for computing limitation for filing appeal under Section 246A of IT Act. Even after such exclusion, if there is delay, it is open to writ petitioner to seek condonation of same under Section 249(3) of IT Act and such prayer for condonation of delay shall be dealt with by Appellate Authority on its own merits. 15. Before parting with this case, it is necessary to mention that alternate remedy rule qua exercise of writ jurisdiction is self imposed http://www.judis.nic.in 7 restraint. It is rule of discretion and it is not rule of compulsion. Though it is not absolute rule, Hon'ble Supreme Court in Satyawati Tandon Case [United Bank of India Vs. Satyawati Tondon and others reported in (2010) 8 SCC 110] held that it should be exercised with greater rigour in fiscal law statutes. More importantly, in Satyawati Tondon case, Hon'ble Supreme Court held that such rule has to be applied with utmost rigour when it comes to cases involving taxes, cess, fees etc., In other words, when it comes to fiscal statutes, these rules have to be applied with greater rigour and it is to be applied very strictly with regard to recovery of taxes, CESS, fess etc., Satyawati Tondon principle was reiterated by Hon'ble Supreme Court in K.C.Mathew case [Authorized Officer, State Bank of Travancore Vs. Mathew K.C. reported in (2018) 3 SCC 85]. Relevant paragraph in K.C.Mathew case is paragraph 10 and same reads as follows: '10. In Satyawati Tondon High Court had restrained further proceedings under Section 13(4) of Act. Upon detailed consideration of statutory scheme under SARFAESI Act, availability of remedy to aggrieved under Section 17 before Tribunal and appellate remedy under Section 18 before Appellate Tribunal, object and purpose of legislation, it was observed that writ petition ought not to be entertained in view of alternate statutory remedy available holding: http://www.judis.nic.in 8 (SCC pp.123 & 128, Paras 43 & 55) 43. Unfortunately, High Court overlooked settled law that High Court will ordinarily not entertain petition under Article 226 of Constitution if effective remedy is available to aggrieved person and that this Rule applies with greater rigour in matters involving recovery of taxes, cess, fees, other types of public money and dues of banks and other financial institutions. In our view, while dealing with petitions involving challenge to action taken for recovery of public dues, etc., High Court must keep in mind that legislations enacted by Parliament and State Legislatures for recovery of such dues are code unto themselves inasmuch as they not only contain comprehensive procedure for recovery of dues but also envisage constitution of quasi- judicial bodies for redressal of grievance of any aggrieved person. Therefore, in all such cases, High Court must insist that before availing remedy under Article 226 of Constitution, person must exhaust remedies available under relevant statute. 55.It is matter of serious concern that despite repeated pronouncement of this Court, High Courts continue to ignore availability of statutory remedies under DRT Act and SARFAESI Act and exercise jurisdiction under Article 226 for passing orders which have serious http://www.judis.nic.in 9 adverse impact on right of banks and other financial institutions to recover their dues. We hope and trust that in future High Courts will exercise their discretion in such matters with greater caution, care and circumspection.' 16. This writ petition is disposed of, leaving it open to writ petitioner to avail alternate remedy of statutory appeal to Commissioner (Appeals) under Section 246A of IT Act, in manner set out supra in this order. 17. This writ petition is disposed of with above observations. No costs. Consequently, connected miscellaneous petitions are closed. 18.07.2019 kak Index:Yes/No Speaking order http://www.judis.nic.in 10 M.SUNDAR, J. kak To Income Tax Officer, Ward 1(3), Income Tax Officer, No.121, Adam Building, Sixty Feet Road, Tirupur 641 602 W.P.No.4448 of 2019 and W.M.P.Nos.5014 & 5016 of 2019 18.07.2019 K274 Uthukuli Primary Agricultural Cooperative Credit Society Limited v. Income-tax Officer, Ward-1(3), Tirupur