ZAKIR HUSSAIN vs. INCOME TAX OFFICER

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WP/1425/2026HC KarnatakaKAHC01002130202618 March 2026Bench: S SUNIL DUTT YADAV4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Karnataka, taking note of the petitioner's contention that he could demonstrate the alleged deposits of Rs. 60,00,000/- were an incorrect inference by the department, decided to provide the petitioner an opportunity to participate in the assessment proceedings. Consequently, the Court set aside the orders at Annexures-C, D, E, F, and G1. The matter was remitted to the stage of the petitioner filing a reply to the notice issued under Section 148A(b) of the Act (Annexure-A). All contentions of both parties were kept open. The petitioner was directed to appear before the respondent Income Tax Officer on 21.04.2026 without further notice. Upon appearance, the petitioner was to be provided with relevant records to enable him to file a proper reply to the Section 148A(b) notice. The petition was disposed of accordingly.

What were the facts?

The petitioner, Zakir Hussain, filed a writ petition before the High Court of Karnataka challenging notices and orders related to his income tax assessment. The assessment year in question is 2017-18. The petitioner is challenging a notice dated 21-02-2024 issued under Section 148A(b) of the Income Tax Act, 1961, an order passed under Section 148A(d), and an ex-parte assessment order dated 27.03.2025. He also challenged penalty orders at Annexures-F and G1. The petitioner claims that due to a bona fide lapse, he could not reply to the Section 148A(b) notice. The notice was issued on the premise of unexplained deposits of Rs. 60,00,000/-. The petitioner asserts he can demonstrate from bank records that no such deposits were made.

What were the issues?

1. Whether the order passed under Section 148A(b) of the Income Tax Act, 1961, and subsequent proceedings, including the ex-parte assessment order and penalty orders, are valid, considering the petitioner's claim of a bona fide lapse in responding to the notice? Assessee's Contentions: The petitioner argues that he failed to reply to the Section 148A(b) notice due to a bona fide lapse. He contends that the premise for issuing the notice, which was unexplained deposits of Rs. 60,00,000/-, is incorrect and can be disproven by bank records. The petitioner also submits that the ex-parte assessment order was passed due to his non-participation. Revenue's Contentions: The judgment does not record specific contentions from the revenue.

Which sections of the Income-tax Act were involved?

Section 148A(b),Section 148A(d),Section 148

AI-generated summary — verify with the full judgment below

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HC-KAR NC: 2026:KHC:15829 WP No. 1425 of 2026 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18TH DAY OF MARCH, 2026 BEFORE THE HON'BLE MR. JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 1425 OF 2026 (T-IT) BETWEEN: 1. ZAKIR HUSSAIN, S/O. MUNEER UI HUSSAIN, AGED 50 YEARS, DUBAI NAGAR, PENSION MOHALLA NEW EXTENSION, CHICKMAGALUR - 577 101. …PETITIONER (BY SRI. RAMA MURTHY R.,ADVOCATE) AND: 1. INCOME TAX OFFICER, WARD-1, COURT ROAD, CHICKMAGALUR - 577 101. …RESPONDENT (BY SRI. THIRUMALESH, ADVOCATE ALONG WITH SRI. M. DILIP, ADVOCATE)

THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO A. QUASHING THE NOTICES DATED 21-02-2024 ISSUED U/S 148A(B) OF THE ACT (ANNEXURE-A) DIN Digitally signed by VIJAYA P Location: HIGH COURT OF KARNATAKA

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HC-KAR NC: 2026:KHC:15829 WP No. 1425 of 2026 ITBA/AST/F/148A(SCN)/2023-24/1061239902(1) ISSUED FOR THE ASSESSMENT YEAR 2017-18 BY THE RESPONDENT AND ETC.

THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE S SUNIL DUTT YADAV ORAL ORDER

The petitioner has called in question the validity of the order dated 21.02.2024 made under Section 148A(b) of the Income Tax Act, 1961 (hereinafter referred to as "the Act") and also the ex-parte order of assessment dated 27.03.2025. The Petitioner has also challenged the orders of penalty at Annexures-F and G1.

2.

It is the case of the petitioner that due to bona fide lapse, he was not able to make out reply to the notice under Section 148A(b) of the Act which has resulted in an order passed under Section 148A(d) of the Act and further

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HC-KAR NC: 2026:KHC:15829 WP No. 1425 of 2026 proceedings after issuance of notice under Section 148 of the Act culminating in an assessment order which again was an ex-parte assessment order.

3.

Learned counsel for the petitioner would submit that the notice under Section 148A(b) of the Act came to be issued on the premise that there were deposits of Rs.60,00,000/- which were not explained. The petitioner submits that he is in a position to demonstrate from bank records that there are no such deposits as alleged. It is further submitted that, in light of the non-participation of the petitioner, the ex-parte assessment order is passed.

4.

Taking note of the contention of the petitioner that he is in a position to demonstrate that the amount of Rs.60,00,000/- which the department deemed to be as income chargeable to tax has escaped assessment, is an incorrect inference, it would be appropriate to afford the petitioner an opportunity to participate in the assessment proceedings. Accordingly, the orders at Annexures-C, D, E,

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HC-KAR NC: 2026:KHC:15829 WP No. 1425 of 2026 F and G1 are set aside. The matter is remitted to the stage of reply to the Section 148A(b) notice at Annexure-A. All contentions are kept open.

5.

The petitioner to appear before the sole respondent without further notice on 21.04.2026. Upon appearance, the petitioner may be communicated with copy of relevant records that may be required to enable the petitioner to make out a proper reply to the Section 148A(b) notice.

6.

Accordingly, the petition is disposed of. Sd/- (S SUNIL DUTT YADAV) JUDGE SHS List No.: 1 Sl No.: 6

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