Wp/16294/2025 Of The Potunuru Primary Agricultural Coop Credit Society Limited v. The Income Tax Officer

APHC010322512025 IN THE HIGH COURT OF ANDHRA PRADESH.yAT AMARAVATI(Special Original Jurisdiction) WEDNESDAY,THE SECOND DAY OF JULYTWO THOUSAND AND TWENTY FIVE PRESENT HONOURABLE SRI JUSTICE NINALA JAYASURYA AND HONOURABLE SRI JUSTICE TARLADA RAJASEKHAR RAO WRIT PETITION NO: 16294 OF 2025 Between: M/s The Potunuru Primary Agricultural Coop Credit SocietyLimited3-24Pothunuru, Pothunuru Post, Chintalapudi, West Godavari - 534 460, AndhraPradesh.Represented by its Chief Executive Officer^Mr. Kanakala VeeraRaghavulu, S/o Mr. Kanakala Nageswara Rao. ...Petitioner/s AND 1. The Income TaxOfficer,Circle-1, RajahmahendravaramAayakarBhawan, Veerabhadrapuram, Rajahmundry- 533106, Andhra Pradesh.Bhawan, Veerabhadrapuram, Rajahmundry- 533106, Andhra Pradesh.2. Assessment Unit, Income Tax Department,National e-AssessmentCenter, New Delhi,Room No. 401, 2nd Floor, E-Ramp,JawaharlalNehru Stadium, New Delhi - 110 003.Center, New Delhi,Room No. 401, 2nd Floor, E-Ramp,JawaharlalNehru Stadium, New Delhi - 110 003.3. The Principal Commissioner of Income Taxnd1, Visakhapatnam,21, Visakhapatnam,2Floor, Aayakar Bhavan, Daba Gardens,Visakhapatnam- 530 020,Visakhapatnam- 530 020,Andhra Pradesh. w- r 4. The Joint Commissioner (Appeals) / the Commissioner of Income Tax(Appeals),National Faceless Appeal Centre,Delhi,ThroughthePrincipal Chief Commissioner of Income Tax (NaFAC),Delhi,NorthBlock, New Delhi - 110 001.(Appeals),National Faceless Appeal Centre,Delhi,ThroughthePrincipal Chief Commissioner of Income Tax (NaFAC),Delhi,NorthBlock, New Delhi - 110 001. 5; The Central Board of Direct Taxes, Represented byitsChairman,^Department of Revenue, Ministry of FinanceGovernment of India,Secretariat Buildings, New Delhi - 110 001.^Department of Revenue, Ministry of FinanceGovernment of India,Secretariat Buildings, New Delhi - 110 001. 6. The Branch Manager, The District Cooperative Central Bank Limited,Eluru,Chintalapudi Branch, Near Telephone Office,Chintalapudi,West Godavari District, Andhra Pradesh.Eluru,Chintalapudi Branch, Near Telephone Office,Chintalapudi,West Godavari District, Andhra Pradesh. ...Respondent/s Petition under Article 226 of the Constitution of India is filed praying thatin the circumstances stated in the affidavit filed therewith, the High Courtmaybe pleased to issue a Writ of Mandamus or any other appropriate Writ, Orderor Direction, declaring; a)the order of the1Respondent, dated 04.02.2025, vide DIN ANDLetter No. ITBA/COM/F/17/2024-25/1072906261(1), in directing the Petitionerto pay 20 % of the disputed demand pending disposal of its appeal before the1Appellate Authority, i.e., the 4*^ Respondent herein, for the AssessmentYear 2019-20; & b) the garnishee notice issued by the 1"‘ Respondent, u/s 226(3)of theIncome Tax Act, 1961, vide DIN AND Notice No. ITBA/RCV/S/226(3)1/2024-25/1071881350(1),dated06.01.2025,andvideDIN ANDNoticeNo.ITBA/RCV/S/226(3)_1/2024-25/1071988498(1), dated08.01.2025to the 6Respondent herein, i.e., the banker of the Petitioneras arbitrary, illegal, badin law, bereft of any valid reasons, violative of theprinciples of natural justiceapart from being violative of Articles 14,19<1Xg) and 265 of the Constitution ofIndia AND Sec. 148A of the Income Tax Act,1961, and consequently setaside the same. lA NO: 1 OF 2025 PetitionunderSection151CPCisfiledprayingthatinthecircumstances stated in the affidavit filed in support of the petition, the HighCourt may be pleased to stay all further proceedings, including any recovery,pursuant to the orderof the 1st Respondent, dated 04.02.2025, vide DIN &LetterNo.;ITBA/COM/F/17/2024-25/1072906261(1),indirectingthePetitioner to pay 20% of the disputed demand, pending disposal of its appealbefore the1Appellate Authority, i.e., the 4*^Respondent herein, for theAssessment Year 2019 - 20, pending disposal of the above WritPetition. lA NO: 2 OF 2025 lA NO: 1 OF 2025 PetitionunderSection151CPCisfiledprayingthatinthecircumstances stated in the affidavit filed in support of the petition, the HighCourt may be pleased to stay all further proceedings, including any recovery,pursuant to the orderof the 1st Respondent, dated 04.02.2025, vide DIN &LetterNo.;ITBA/COM/F/17/2024-25/1072906261(1),indirectingthePetitioner to pay 20% of the disputed demand, pending disposal of its appealbefore the1Appellate Authority, i.e., the 4*^Respondent herein, for theAssessment Year 2019 - 20, pending disposal of the above WritPetition. lA NO: 2 OF 2025 Petition under Section 151 CPC is filed praying that in the circumstancesstated in the affidavit filed in support of the petition, the High Court may bepleased to suspend the garnishee notice issued by the1Respondent, u/s226(3)oftheIncomeTaxAct,1961,videDIN&NoticeNo.lTBA/RCV/S/226(3)_1/2024-25/1071881350(1),dated06.01.2025,andvide DIN & Notice No.lTBA/RCV//S/226(3)_1/2024-25/1071988498(1),dated08.01.2025, to the 6‘^Respondent herein, i.e., the banker of thePetitioner;pending disposal of the above Writ Petition. Counsel for the Petitioner: SRI A.V.A. SIVA KARTIKEYA Counsel for the Respondent Nos.1 to 5: SRI VAMSI KRISHNABODAPATI, SC REPRESENTING SRI ANUP KOUSHIK KARAVADI, FOR INCOME TAX DEPARTMENT Counsel for the Respondent No.6: - The Court made the following order: APHC010322512025 IN THE HIGH COURT OF ANDHRA PRADESHAT AMARAVATI.y(Special Original Jurisdiction) [3526] WEDNESDAY,THE SECOND DAY OF JULYTWO THOUSAND AND TWENTY FIVE PRESENT THE HONOURABLE SRI JUSTICE NINALA JAYASURYA THE HONOURABLE SRI JUSTICE TARLADA RAJASEKHAR RAO WRIT PETITION NO: 16294/2025 Between: 1.THEPOTUNURUPRIMARYAGRICULTURALCOOPCREDITSOCIETYLIMITED,3-24POTHUNURU,POTHUNURUPOST,CHINTALAPUDI, WEST GODAVARI - 534 460, ANDHRA PRADESH.REPRESENTEDBYITSCHIEFEXECUTIVEOFFICER,MR.KANAKALAVEERARAGHAVULU,S/0MR.KANAKALANAGESWARA RAO.SOCIETYLIMITED,3-24POTHUNURU,POTHUNURUPOST,CHINTALAPUDI, WEST GODAVARI - 534 460, ANDHRA PRADESH.REPRESENTEDBYITSCHIEFEXECUTIVEOFFICER,MR.KANAKALAVEERARAGHAVULU,S/0MR.KANAKALANAGESWARA RAO. ...PETITIONER AND 1.THE INCOME TAX OFFICER, CIRCLE-1, RAJAHMAHENDRAVARAMAAYAKARBHAWAN,VEERABHADRAPURAM,RAJAHMUNDRY-533106, ANDHRA PRADESH.AAYAKARBHAWAN,VEERABHADRAPURAM,RAJAHMUNDRY-533106, ANDHRA PRADESH. 2.ASSESSMENT UNIT, INCOME TAX DEPARTMENTNATIONALE-ASSESSMENT CENTER, NEW DELHI, ROOM NO. 401, 2ND FLOOR,E-RAMP, JAWAHARLAL NEHRU STADIUM, NEW DELHI -110 003.ASSESSMENT CENTER, NEW DELHI, ROOM NO. 401, 2ND FLOOR,E-RAMP, JAWAHARLAL NEHRU STADIUM, NEW DELHI -110 003. 3.THEPRINCIPALCOMMISSIONEROFINCOMETAX1VISAKHAPATNAM,2NDFLOOR,AAYAKARBHAVAN,DABAGARDENS, VISAKHAPATNAM - 530 020, ANDHRA PRADESH.VISAKHAPATNAM,2NDFLOOR,AAYAKARBHAVAN,DABAGARDENS, VISAKHAPATNAM - 530 020, ANDHRA PRADESH.4.THE JOINT COMMISSIONER, (APPEALS) /THE COMMISSIONEROF INCOME TAX(APPEALS),NATIONALFACELESSAPPEALCENTRE,DELHI,THROUGHTHEPRINCIPALCHIEFCOMMISSIONER OFINCOMETAX(NAFAC),DELHI,NORTHOF INCOME TAX(APPEALS),NATIONALFACELESSAPPEALCENTRE,DELHI,THROUGHTHEPRINCIPALCHIEFCOMMISSIONER OFINCOMETAX(NAFAC),DELHI,NORTH BLOCK, HE\N DELHI-^^0 00^. ESH. 5.THE CENTRAL BOARD OF DIRECT TAXES, REPRESENTED BY ITSCHAIRMAN, DEPARTMENT OF REVENUE, MINISTRY OF FINANCE,CHAIRMAN, DEPARTMENT OF REVENUE, MINISTRY OF FINANCE,GOVERNMENT OF INDIA, SECRETARIAT BUILDINGS, NEW DELHI110001.110001. 6. THE BRANCH MANAGER, THE DISTRICT COPERATIVE CENTRALBANKLIMITED,ELURUCHINTALAPUDIBRANCH,NEARTELEPHONEOFFICE,CHINTALAPUDI,WESTGODAVARIDISTRICT, ANDHRA PRADBANKLIMITED,ELURUCHINTALAPUDIBRANCH,NEARTELEPHONEOFFICE,CHINTALAPUDI,WESTGODAVARIDISTRICT, ANDHRA PRAD ...RESPONDENT(S): BLOCK, HE\N DELHI-^^0 00^. ESH. 5.THE CENTRAL BOARD OF DIRECT TAXES, REPRESENTED BY ITSCHAIRMAN, DEPARTMENT OF REVENUE, MINISTRY OF FINANCE,CHAIRMAN, DEPARTMENT OF REVENUE, MINISTRY OF FINANCE,GOVERNMENT OF INDIA, SECRETARIAT BUILDINGS, NEW DELHI110001.110001. 6. THE BRANCH MANAGER, THE DISTRICT COPERATIVE CENTRALBANKLIMITED,ELURUCHINTALAPUDIBRANCH,NEARTELEPHONEOFFICE,CHINTALAPUDI,WESTGODAVARIDISTRICT, ANDHRA PRADBANKLIMITED,ELURUCHINTALAPUDIBRANCH,NEARTELEPHONEOFFICE,CHINTALAPUDI,WESTGODAVARIDISTRICT, ANDHRA PRAD ...RESPONDENT(S): Petition under Article 226 of the Constitution of India praying that in thecircumstances stated in the affidavit filed therewith, the High Court may bepleased to pleased to issue a Writ of Mandamus or anyother appropriateWrit, Order or Direction, declaringthe order of the 1st Respondent, dated04.02.2025,videDINa.ANDLetterNo.ITBA/COM/F/17/2024-25/1072906261(1),indirecting the Petitioner to pay[20] PERCENT[ of][ the]disputed demandpending disposal of its appeal before the 1st AppellateAuthority, i.e., the 4th Respondent herein, for the Assessment Year 2019-20ANDb. the garnishee notice issued by the 1st Respondent, u/s 226(3) of theIncome Tax Act, 1961, vide DIN AND Notice No. ITBA/RCV/S/226(3)_[1/2024-]25/1071881350(1),dated06.01.2025,andvideDINANDNoticeNo.ITBA/RCV/S/226(3)_1/2024-25/1071988498(1), dated08.01.2025,[to][ the][ 6th]Respondent herein, i.e., the banker of the Petitioner as arbitrary, illegal, badin law, bereft of any valid reasons, violative of theprinciples of natural justiceapart from being violative of Articles 14,19(1)(g) and 265 of the Constitution ofIndia AND Sec. 148A of the Income Tax Act,1961, and consequently setaside the same in the interests of justice and to pass lA NO: 1 OF 2025 Petition under Section 151 CPC praying that in the circumstances statedin the affidavit filed in support of the petition, the High Court may be pleasedpleased tostay all further proceedings, including any recovery, pursuant tothe orderof the 1st Respondent, dated 04.02.2025, vide DIN & Letter No.;ITBA/COM/F/17/2024-25/1072906261 (1),in directing thePetitionertopay20% of the disputed demand, pending disposal of its appeal before the1stAppellate Authority, i.e., the 4th Respondent herein, for the Assessment Year2019 - 20,, pending disposal of the above Writ Petition:andpass lA NO: 2 OF 2025 Petition under Section 151 CPC praying that in the[circumstances][ stated]in the affidavit filed in support of the petition, the High Court may be pleasedPleased tosuspend the garnishee notice issued by the 1st Respondent, u/s226(3)oftheIncomeTaxAct,1961,videDIN&NoticeNo.:ITBA/RCV/S/226(3)_1/2024-25/1071881350(1), dated 06.01.2025,[and]videDIN & Notice No.: ITBA/RCV//S/226(3)_1/2024-25/1071988498(1),dated08.01.2025, to the 6th Respondent herein, i.e., the banker of thePetitioner;pending disposal of the above Writ Petition; and pass Counsel for the Petitioner: 1. A V A SIVA KARTIKEYA Counsel for the Respondent(S): 1. The Court made the following ORDER: {per NJS,J) Heard Mr.A.V.A.Siva Kartikeya, learned counsel for the petitioner.AlsoheardMr.VamsiKrishnaBodapati,learnedJuniorStandingCounselrepresenting Mr.Anup Koushik Karavadi, learned Senior Standing Counsel forthe Income Tax Department. 2.The writ petition is filed seeking the following relief: Counsel for the Petitioner: 1. A V A SIVA KARTIKEYA Counsel for the Respondent(S): 1. The Court made the following ORDER: {per NJS,J) Heard Mr.A.V.A.Siva Kartikeya, learned counsel for the petitioner.AlsoheardMr.VamsiKrishnaBodapati,learnedJuniorStandingCounselrepresenting Mr.Anup Koushik Karavadi, learned Senior Standing Counsel forthe Income Tax Department. 2.The writ petition is filed seeking the following relief: “to issue a Writ of Mandamus or any other appropriate Writ, OrderorDirection, declaring a. the order of the P' Respondent, dated 04.02.2025,vide DIN & Letter No. ITBA/COM/F/17/2024-25/1072906261(1),in directingthe Petitioner to pay 20% of the disputed demand, pending disposal of itsappeal before theAppellate Authority,i.e., the 4^^ Respondent herein, forthe Assessment Year 2019-20, &b. the garnishee notice issued by the F'Respondent, u/s 226(3) of the Income Tax Act, 1961, vide DIN AND NoticeNo. ITBA/RCV/S/226(3)_1/2024-25/1071881350(1), dated06.01.2025, andvide DIN & Notice No. ITBA/RCV/S/226(3)J/2024-25/1071988498(1),[dated]08.01.2025, to theRespondent herein,i.e., the banker ofthe Petitioneras arbitrary, illegal, bad in law, bereft of any valid reasons,violative of theprinciples of natural justice apart from being violative of Articles 14,19(1)(g)and 265 of the Constitution of India & Sec. 148A of the Income Tax Act,1961, and consequently set aside the same in the interests ofjustice and topass... ”(in verbatim) NJS,J& TRR,JW.P.NO.16294 OF2025 ■ 3.The learned counsel for the petitioner, while making[submissions][ with]reference to various legal contentions raised in the writ affidavit, submits thecircumstances under which the petitioner society could[not][ file][ Its][ return][ of][ the]taxintime.He submits that the order passed by the respondentNo.1directingthepetitionertopay 20%ofthe demandedamount,withoutconsidering the case of the petitioner, is not sustainable.[He][ states][ that][ due][ to]financial constraints, the same could not be paid.[He][ also][ submits][ that][ In]similar circumstances a Coordinate Benchof thisCourtvide order dated31.12.2024 in Writ Petition No.27342 of 2024 was pleased to dispose of thesame with a direction to the Appellate Authority to dispose of the appeal withina period of six months and that during the pendency of the appeal,theAuthorities shall not insist for the payment of the demanded amount.Thelearned counselsubmits thatin fact against the demandsraised by theAssessing Authorities several writ petitions were filed and while entertainingthe said writ petitions, interim orders were granted.reference to various legal contentions raised in the writ affidavit, submits thecircumstances under which the petitioner society could[not][ file][ Its][ return][ of][ the]taxintime.He submits that the order passed by the respondentNo.1directingthepetitionertopay 20%ofthe demandedamount,withoutconsidering the case of the petitioner, is not sustainable.[He][ states][ that][ due][ to]financial constraints, the same could not be paid.[He][ also][ submits][ that][ In]similar circumstances a Coordinate Benchof thisCourtvide order dated31.12.2024 in Writ Petition No.27342 of 2024 was pleased to dispose of thesame with a direction to the Appellate Authority to dispose of the appeal withina period of six months and that during the pendency of the appeal,theAuthorities shall not insist for the payment of the demanded amount.Thelearned counselsubmits thatin fact against the demandsraised by theAssessing Authorities several writ petitions were filed and while entertainingthe said writ petitions, interim orders were granted. 4.Whereas,the learned Junior Standing Counselfor therespondentDepartment submits thatit is not the case of the writ petitioner thatit is notcapable of paying the installment amounts and further that having availed theremedy of appeal, the writ petitioner is not justified in filing the writ petition.Department submits thatit is not the case of the writ petitioner thatit is notcapable of paying the installment amounts and further that having availed theremedy of appeal, the writ petitioner is not justified in filing the writ petition. 5.Though the learned counselfor thepetitioner raisedseverallegalcontentions and it is also not in dispute that several writ petitions challengingthe demands raised by the Assessing Authorities were entertained, in the lightof the orders passed in Writ Petition No.27342 of 2024, dated 31.12.2024, thisCourt is inclined to dispose of the writ petition on similar lines.contentions and it is also not in dispute that several writ petitions challengingthe demands raised by the Assessing Authorities were entertained, in the lightof the orders passed in Writ Petition No.27342 of 2024, dated 31.12.2024, thisCourt is inclined to dispose of the writ petition on similar lines. 6.The respondent No.4-Appellate Authority shall dispose of the appealpreferred by the writ petitioner within a period of two months from the date ofreceipt of a copy of this order.Pending disposal of the appeal, no action tocollect the outstanding tax demand shall be initiated and the liability of thepetitioner,if any, shall be subject to the decision of the Appellate Authority, inpreferred by the writ petitioner within a period of two months from the date ofreceipt of a copy of this order.Pending disposal of the appeal, no action tocollect the outstanding tax demand shall be initiated and the liability of thepetitioner,if any, shall be subject to the decision of the Appellate Authority, in NJS,J& TRR,JW.P. NO. 16294 OF 2025the appeal on merits.The petitioner is at liberty to file additional material,ifany, before the Appellate Authority andit is needlessto statethat beforepassing orders asindicated above,thepetitioner shallbeaffordedanopportunity of hearing. 7.Considering the fact that the writ petitioner is a Primary Agricultural Cooperative Society and it’s day to day affairs/banking transactions came to astandstill by virtue of garnishee notices, pending disposal of the appeal, It shallbe allowedto operateits accounttotheextent of paymentstowardsstatutory compliances, salaries to staff and loans only. 8.With the above directions, the writ petition is disposed[of.]No orderasto costs. Miscellaneous petitions pending, if any, shall stand[closed.] Sd/- B CHITTI JOSEPHASSISTANT REGISTRAR //TRUE COPY//SECTION OFFICERSECTION OFFICERTo,1. The Income TaxOfficer,Circle-1, RajahmahendravaramAayakarBhawan, Veerabhadrapuram, Rajahmundry- 533106, Andhra[Pradesh.]1. The Income TaxOfficer,Circle-1, RajahmahendravaramAayakarBhawan, Veerabhadrapuram, Rajahmundry- 533106, Andhra[Pradesh.]2. Assessment Unit, Income Tax Department,National e-AssessmentCenter, New Delhi,Room No. 401, 2nd Floor, E-Ramp,JawaharlalNehru Stadium, New Delhi - 110 003.Center, New Delhi,Room No. 401, 2nd Floor, E-Ramp,JawaharlalNehru Stadium, New Delhi - 110 003. 3. The Principal Commissioner of Income Tax1, Visakhapatnam,2ndFloor, Aayakar Bhavan, Daba Gardens,Visakhapatnam- 530 020,Andhra Pradesh.Floor, Aayakar Bhavan, Daba Gardens,Visakhapatnam- 530 020,Andhra Pradesh. 4. The Joint Commissioner, (Appeals) / the Commissioner of Income Tax(Appeals),National Faceless Appeal Centre,Delhi,ThroughthePrincipal Chief Commissioner of Income Tax (NaFAC),Delhi,NorthBlock, New Delhi - 110 001.(Appeals),National Faceless Appeal Centre,Delhi,ThroughthePrincipal Chief Commissioner of Income Tax (NaFAC),Delhi,NorthBlock, New Delhi - 110 001. 3. The Principal Commissioner of Income Tax1, Visakhapatnam,2ndFloor, Aayakar Bhavan, Daba Gardens,Visakhapatnam- 530 020,Andhra Pradesh.Floor, Aayakar Bhavan, Daba Gardens,Visakhapatnam- 530 020,Andhra Pradesh. 4. The Joint Commissioner, (Appeals) / the Commissioner of Income Tax(Appeals),National Faceless Appeal Centre,Delhi,ThroughthePrincipal Chief Commissioner of Income Tax (NaFAC),Delhi,NorthBlock, New Delhi - 110 001.(Appeals),National Faceless Appeal Centre,Delhi,ThroughthePrincipal Chief Commissioner of Income Tax (NaFAC),Delhi,NorthBlock, New Delhi - 110 001. 5. The Chairman,Central Board of Direct Taxes, Department of Revenue,Ministry of Finance,Government of India, Secretariat Buildings, NewDelhi - 110 001.Ministry of Finance,Government of India, Secretariat Buildings, NewDelhi - 110 001. 6. The Branch Manager, The District Cooperative Central BankLimited,Eluru,Chintalapudi Branch, Near Telephone Office,Chintalapudi,West Godavari District, Andhra Pradesh.Eluru,Chintalapudi Branch, Near Telephone Office,Chintalapudi,West Godavari District, Andhra Pradesh. 7. One CC to SRI. A V A SIVA KARTIKEYA, Advocate 8. One CC to SRI. ANUP KOUSHIK KARAVADI, STANDINGCOUNSELFOR INCOME TAX DEPARTMENT 8. One CC to SRI. ANUP KOUSHIK KARAVADI, STANDINGCOUNSELFOR INCOME TAX DEPARTMENT 9. Two CD Copies sree HIGH COURTDATED:02/07/2025 ORDERWP NO. 16294 OF 2025 DISPOSING OF THE W.P.WITHOUT COSTS 2 8 AUG 2025|SOCo .^