SMT NEELAPPA PREMA vs. THE PRINCIPAL COMMISSIONER OF INCOME TAX

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WP/10843/2023HC KarnatakaKAHC01025251202325 April 2025Bench: S.R.KRISHNA KUMAR4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court of Karnataka, while acknowledging the respondent's conclusion that principles of natural justice were complied with, took a justice-oriented approach. The Court noted the petitioner's specific assertion of bonafide reasons and unavoidable circumstances preventing her from responding to the notice. To provide the petitioner with one more opportunity, the Court decided to set aside the impugned order. The matter was remitted back to the Income Tax Officer for reconsideration. The petitioner was granted liberty to submit her reply and documents, and the ITO was directed to consider them and proceed in accordance with law after providing a personal hearing. The petition was allowed, and the impugned order was quashed.

What were the facts?

The petitioner, Smt. Neelappa Prema, an individual assessee, filed her return of income for Assessment Year 2016-17. The Income Tax Officer (ITO), respondent No. 2, issued a notice under Section 144A(d) of the Income Tax Act, 1961. The petitioner did not submit a reply to this notice. Consequently, the ITO passed an ex parte order under Section 147 read with Section 144 of the Act, dated 30.03.2023. The petitioner, aggrieved by this order, filed a writ petition before the High Court of Karnataka, challenging the order on grounds of non-compliance with principles of natural justice.

What were the issues?

1. Whether the impugned order dated 30.03.2023 passed by the Income Tax Officer under Section 147 read with Section 144 of the Income Tax Act, 1961, is liable to be quashed on the ground that principles of natural justice were not complied with, despite the petitioner asserting bonafide reasons and unavoidable circumstances for not submitting a reply? Assessee's contention: The petitioner contended that due to bonafide reasons, unavoidable circumstances, and sufficient cause, she was unable to submit a reply and documents to the notice/show cause notice and participate in the proceedings, thereby violating the principles of natural justice. Revenue's contention: The revenue, through the impugned order, concluded that principles of natural justice had been complied with, as sufficient and reasonable opportunity had been provided to the petitioner prior to passing the order. No specific arguments from the revenue are recorded in the judgment beyond this assertion within the order itself.

Which sections of the Income-tax Act were involved?

Section 147,Section 144,Section 144A

AI-generated summary — verify with the full judgment below

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NC: 2025:KHC:17200 WP No. 10843 of 2023

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 25TH DAY OF APRIL, 2025 BEFORE THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO.10843 OF 2023 (T-IT) BETWEEN:

SMT. NEELAPPA PREMA, W/O SRI YUVARAJ, AGED ABOUT 48 YEARS, R/AT NO.161, 4TH CROSS, 8TH MAIN ROAD, 14TH BLOCK NAGARBHAVI, BENGALURU – 560 091.

…PETITIONER (BY SMT. BHARGAVI S.V., FOR SRI. MALLAHAR RAO, ADVOCATES)

AND:

1.

THE PRINCIPAL COMMISSIONER OF INCOME TAX C.R. BUILDING NO.1, QUEENS ROAD, BANGALORE – 560 001.

2.

THE INCOME TAX OFFICER CENTRAL CIRCLE 2(4), BANGALORE – 560 001. …RESPONDENTS (BY SRI. M. DILIP, ADVOCATE)

THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ORDER DATED 30.03.2023 PASSED BY 2ND RESPONDENT IN ORDER NO. ITBA/AST/S/147/2022-23/1051692713(1) VIDE ANNEXURE-C AND ETC.

THIS PETITION, COMING ON FOR ORDERS, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

CORAM: HON'BLE MR JUSTICE S.R.KRISHNA KUMAR

Digitally signed by CHANDANA B M Location: High Court of Karnataka

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NC: 2025:KHC:17200 WP No. 10843 of 2023

ORAL ORDER This petition is directed against the impugned order dated 30.03.2023 vide Annexure-C passed by respondent No.2 under Section 147 read with Section 144 of the Income Tax Act, 1961 [for short, ‘the Act’].

2.

Heard learned counsel for the petitioner and the learned counsel for the respondents and perused the material on record.

3.

The material on record discloses that the petitioner is an individual assessee who filed return of income for the Assessment Year 2016-17. Pursuant to the impugned proceedings, the respondents are said to have issued notice under Section 144A(d) of the Act and since the petitioner had not submitted any reply to the said notice/show cause notice, the respondents proceeded to pass the impugned ex parte order, aggrieved by which the petitioner is before this Court by way of present petition.

4.

A perusal of the impugned order will indicate that the respondents have come to the conclusion that principles of natural justice had been complied with since sufficient and reasonable

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NC: 2025:KHC:17200 WP No. 10843 of 2023

opportunity had been provided to the petitioner prior to passing the impugned order. However, in view of the specific assertion on the part of the petitioner that due to bonafide reasons, unavoidable circumstances and sufficient cause, the petitioner was not in a position to submit reply along with the documents to the notice/show cause notice and participate in the proceedings, in order to provide one more opportunity to the petitioner and by adopting justice oriented approach, I deem it just and appropriate to set aside the impugned order and remit the matter back to the respondent for reconsideration afresh in accordance with law. In the result, the following: ORDER (i) The petition is hereby allowed.

(ii) The impugned order at Annexure – C dated 30.03.2023 passed by respondent No.2 is hereby quashed. (iii) The matter is remitted back to respondent No.2 for reconsideration afresh in accordance with law. (iv) Liberty is reserved in favour of the petitioner to submit his reply, documents etc., before

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NC: 2025:KHC:17200 WP No. 10843 of 2023

respondent No.2, who shall consider the same and proceed further in accordance with law after providing an opportunity of personal hearing to the petitioner.

Sd/- (S.R.KRISHNA KUMAR) JUDGE

SV List No.: 2 Sl No.: 1

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