THE DEPUTY COMMISSIONER OF INCOME TAX vs. SHRI. PANKAJ MUTHUA

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ITA/90/2026HC KarnatakaKAHC01032720202609 July 2026Author: S.G.PANDIT,K.MANMADHA RAO3 pages
AI SummaryRemanded

What did the High Court hold?

The High Court held that the appeal filed under Section 260A of the Income Tax Act, 1961, is not maintainable. The Court reasoned that the appeal was preferred against an order passed by the Appellate Tribunal under SAFEMA, and the appellant had invoked Section 49 of the Prohibition of Benami Property Transactions Act, 1988, for filing the appeal. The correct provision for filing such an appeal before the High Court is Section 49 of the Prohibition of Benami Property Transactions Act, 1988, not Section 260A of the Income Tax Act, 1961. Therefore, the office objections regarding the maintainability of the appeal were sustained. The appeal was disposed of with liberty to the appellant to file an appropriate appeal under Section 49 of the Act, 1988. No decision was made on the merits of the case.

What were the facts?

The Deputy Commissioner of Income Tax (Benami Prohibition), Bengaluru, filed an Income Tax Appeal under Section 260A of the Income Tax Act, 1961, before the High Court of Karnataka. The appeal challenged an order dated November 18, 2025, passed by the Appellate Tribunal under SAFEMA (Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act). The appellant sought to set aside the Tribunal's order and confirm the order of the Adjudicating Authority. The respondent is Shri Pankaj Muthua. The specific assessment year(s) and the amount in dispute are not recorded in the judgment. The procedural history indicates that the appeal was filed under an incorrect provision of law.

What were the issues?

1. Whether the appeal filed under Section 260A of the Income Tax Act, 1961, is maintainable before the High Court of Karnataka when the order under challenge was passed by the Appellate Tribunal under SAFEMA, and the appeal is preferred under Section 49 of the Prohibition of Benami Property Transactions Act, 1988. The appellant contended that the appeal is maintainable under Section 260A of the Income Tax Act, 1961. The revenue argued that the appeal should have been filed under Section 49 of the Prohibition of Benami Property Transactions Act, 1988, as the order under challenge was passed by the Appellate Tribunal under SAFEMA. The judgment does not record any specific arguments from the respondent.

Which sections of the Income-tax Act were involved?

Section 260A,Section 49

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 9TH DAY OF JULY, 2026 PRESENT THE HON'BLE MR. JUSTICE S.G.PANDIT AND THE HON'BLE DR. JUSTICE K.MANMADHA RAO INCOME TAX APPEAL NO. 90 OF 2026

BETWEEN:

THE DEPUTY COMMISSIONER OF INCOME TAX (BENAMI PROHIBITION), ROOM NO.213, 2ND FLOOR, C.R. BUILDING ANNEX, QUEEN'S ROAD, BENGALURU-560 001. …APPELLANT (BY SRI. RAVI RAJ Y. V., ADV.)

AND:

SHRI PANKAJ MUTHUA R/O FLAT NO.B2202, VAISHNAVU TERRACES, J.P. NAGAR, 4TH PHASE, BENGALURU-560 076. …RESPONDENT

THIS APPEAL IS FILED UNDER SECTION 260 A OF THE TAX ACT, PRAYING TO ALLOW THE APPEAL AND SET ASIDE THE ORDER PASSED BY THE APPELLATE TRIBUNAL UNDER SAFEMA, IN FPA- PBPT/ 2578 / BNG/ 2023 DATED 18.11.2025 ANNEXURE-A AND CONFIRM THE ORDER OF THE ADJUDICATING AUTHORITY IN R NO.562/2022 ANNEXURE-F.

Digitally signed by NANJUNDACHARI Location: High Court of Karnataka

THIS APPEAL, COMING ON FOR ORDERS, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:

CORAM: HON'BLE MR. JUSTICE S.G.PANDIT AND HON'BLE DR. JUSTICE K.MANMADHA RAO

ORAL JUDGMENT (PER: HON'BLE MR. JUSTICE S.G.PANDIT)

This Income Tax Appeal is filed under Section 49 of the Prohibition of Benami Property Transactions Act, 1988 (for short 'Act, 1988), questioning the order dated 18.11.2025 bearing No.FPA-PBPT-2578/BNG/2023 passed by the Appellate Tribunal under SAFEMA with a prayer to confirm the order of Adjudicating Authority in R.No.562/2022.

2.

The Income Tax Appeal would be maintainable only under Section 260A of the Income Tax Act, 1961. Since, the present appeal is being filed under Section 49 of the Prohibition of Benami Property Transactions Act, 1988, the appeal would not be maintainable. Hence, the appeal

stands disposed of with a liberty to the appellant to file appropriate appeal under Section 49 of the Act, 1988.

Accordingly, the office objections are sustained.

Sd/- (S.G.PANDIT) JUDGE

Sd/- (DR.K.MANMADHA RAO) JUDGE

NC CT:bms List No.: 1 Sl No.: 12

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