PRIMARY AGRICULTURE CO-OPERATIVE SOCIETY, vs. THE INCOME TAX OFFICER,

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WP/12163/2025HC KarnatakaKAHC01028483202525 April 2025Bench: S.R.KRISHNA KUMAR9 pages
AI SummaryRemanded

What did the High Court hold?

The High Court allowed the petition, setting aside the impugned notices and orders. The Court found that the petitioner's assertion of not receiving the Section 148A(b) notice and the subsequent inability to respond due to bonafide reasons, unavoidable circumstances, and sufficient cause was a significant factor. The Court deemed it just and appropriate to grant one more opportunity to the petitioner. The matter was remitted back to the Income Tax Officer (Respondent No.1) for reconsideration from the stage of submitting the reply to the Section 148A(b) notice. The petitioner was granted liberty to submit additional pleadings and documents, which the respondent was directed to consider before proceeding further in accordance with the law. The operative direction was to set aside specific annexures (C, J1, J2, J3, K1, K2, K3, L1, L2, and N) and remit the matter for fresh consideration.

What were the facts?

The petitioner, Primary Agriculture Co-operative Society, filed a writ petition before the High Court of Karnataka challenging various notices and orders issued by the Income Tax Department for Assessment Year 2018-19. The primary grievance was that the petitioner did not receive the notice under Section 148A(b) of the Income Tax Act, 1961, and consequently could not submit a reply. This failure led to a series of subsequent orders, including an assessment order under Section 147 r.w.s. 144 r.w.s. 144B, notices of demand, and penalty orders under Sections 272A(1)(d) and 271AAC(1). The petitioner sought to quash these notices and orders and sought a direction to the bank to allow operation of its accounts.

What were the issues?

1. Whether the petitioner's failure to submit a reply to the notice under Section 148A(b) of the Income Tax Act, 1961, was due to bonafide reasons, unavoidable circumstances, and sufficient cause, warranting an opportunity to resubmit the reply? The Assessee (Petitioner) contended that they did not receive the notice under Section 148A(b) and were unaware of it. Their inability to respond was due to bonafide reasons, unavoidable circumstances, and sufficient cause. They sought an opportunity to submit their reply and documents, requesting the setting aside of the impugned orders and notices. The Revenue (Respondents) contended that the petition had no merit and was liable to be dismissed. No specific authorities, circulars, or precedents were mentioned in the judgment for the Revenue's contention.

Which sections of the Income-tax Act were involved?

Section 148A(b),Section 147,Section 144,Section 144B,Section 156,Section 272A(1)(d),Section 271AAC(1),Section 226(3)

AI-generated summary — verify with the full judgment below

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NC: 2025:KHC:17387 WP No. 12163 of 2025

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.12163 OF 2025 (T-IT) BETWEEN:

PRIMARY AGRICULTURE CO-OPERATIVE SOCIETY, R S JAYANNA RANGANAHALLI, TURUVEKERE TALUK, TUMKUR DISTRICT -572224 REP. BY ITS CHIEF EXECUTIVE OFFICER SRI JAYANNA B R, SON OF SRI SHANKARAPPA, AGED ABOUT 50 YEARS …PETITIONER (BY SRI SHREEHARI KUTSA, ADVOCATE) AND:

1.

THE INCOME TAX OFFICER, WARD 1, TIPTUR, THE JURISDICTIONAL ASSESSING OFFICER UNDER INCOME TAX ACT, 1961, JAYADEVA COMPLEX, TIPTUR, TUMKUR – 572201

2.

PRINCIPAL COMMISSIONER OF INCOME TAX BENGALURU-2, THE SPECIFIED AUTHORITY UNDER SECTION 151 OF THE INCOME TAX ACT, 1961 BMTC BUILDING, 80 FEET ROAD, 6TH BLOCK, NEAR KHB GAMES VILLAGE, KORAMANGALA, BENGALURU -560095

3.

NATIONAL FACELESS ASSESSMENT CENTRE (NFAC), A CENTRE DESCRIBED UNDER SECTION 144B OF

Digitally signed by MALATESH K C Location: HIGH COURT OF KARNATAKA

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NC: 2025:KHC:17387 WP No. 12163 of 2025

THE INCOME TAX ACT, 1961 ROOM NO.401, 2ND FLOOR, E-RAMP, JAWAHARLAL NEHRU STADIUM, DELHI -110 003 REPRESENTED BY PR. CHIEF COMMISSIONER OF INCOME TAX (NEAC)

4.

ASSESSMENT UNIT A UNIT CREATED UNDER SECTION 144B OF THE INCOME TAX ACT, 1961 ROOM NO.401, 2ND FLOOR, E-RAMP, JAWAHARLAL NEHRU STADIUM, DELHI 110 003 REP. BY PR. CHIEF COMMISSIONER OF INCOME TAX (NEAC)

5.

THE BRANCH MANAGER, TUMKUR DCC BANK LIMITED, STATE BANK OF MYSURU ROAD, TUMKUR – 572 101 …RESPONDENTS (BY SRI M.DILIP AND SRI E.I.SANMATHI, ADVOCATE FOR R1 AND R4; NOTICE TO R5 IS DISPENSED WITH VIDE ORDER DATED 25.04.2025)

THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH OF THE DIGITALLY SIGNED AND ELECTRONICALLY COMMUNICATED NOTICE UNDER SECTION 148A(b) OF THE INCOME TAX ACT, 1961, DATED 14/03/2022 ISSUED BY THE RESPONDENT NO.1 FOR THE ASSESSMENT YEAR 2018-19 WHICH BEARS THE DIN VIZ.ITBA/AST/F/148A(SCN)/2021- 22/1040716697(1) AND ENCLOSED AS ANNEXURE-B AND ETC.

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

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

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NC: 2025:KHC:17387 WP No. 12163 of 2025

ORAL ORDER

In this petition, petitioner seeks the following reliefs: “a. Issue a writ of certiorari or any other suitable writ for quashing of the digitally signed and electronically communicated notice under section 148A(b) of the Income Tax Act, 1961, dated 14/03/2022 issued by the Respondent No.1 for the Assessment Year 2018-19 which bears the DIN viz. ITBA/AST/F/148A(SCN)/2021- 22/1040716697(1) and enclosed as Annexure-B. b. issue a writ of certiorari or any other suitable writ for quashing of the digitally signed and electronically communicated order under section 148A(d) of the Income Tax Act, 1961, dated 26/03/2022 issued by the Respondent No.1 for the assessment year 2018-19 which bears the DIN viz.ITBA/AST/F/148A/2021- 22/1041676686(1) and enclosed as Annexure-C. c. Issue a writ of certiorari or any other suitable writ for quashing of the digitally signed and electronically communicated notice under section 148 of the Income Tax Act, 1961, dated 28/03/2022 issued by the Respondent No.1 for the Assessment Year 2018-19 which bears the DIN viz. ITBA/AST/S/148-1/2021- 22/1041856136(1) and enclosed as Annexure-d. d. Issue a writ of certiorari or any other suitable writ for quashing of the digitally signed and electronically communicated assessment order under section 147 r.w.s. 144 r.w.s. 144B of the Income Tax Act, 1961 dated 06/03/2023 issued by the Respondent No.4 for the

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NC: 2025:KHC:17387 WP No. 12163 of 2025

Assessment Year 2018-19 which bears the DIN viz., ITBA/AST/S/147/2022-23/1050436874(1) and enclosed as Annexure-J1. e. Issue a writ of certiorari or any other suitable writ for quashing of the digitally signed and electronically communicated notice of demand under Section 156 of the Income Tax Act, 1961 dated 06/03/2023 issued by the Respondent No.4 for the Assessment Year 2018-19 which bears the DIN viz. ITBA/AST/S/156/2022- 23/1050436986(1) and enclosed as Annexure-J2. f. Issue a writ of certiorari or any other suitable writ for quashing of the digitally signed and electronically communicated computation sheet dated 06/03/2023 issued by the Respondent No.4 for the Assessment Year 2018-19 which bears the DIN viz., ITBS/AST/S/187/2022- 23/1050436955(1) and enclosed as Annexure J3. g. Issue a writ of certiorari or any other suitable writ for quashing of the digitally signed and electronically communicated order under section 272A(1)(d) of the Income-Tax Act, 1961, dated 12/09/2023 issued by the Respondent No.4 for the Assessment Year 2018-19 which bears the DIN viz., ITBA/PNL/F/272A(1)(D)/2023- 24/1056005075(1) and enclosed as Annexure-K1. h. Issue a writ of certiorari or any other suitable writ for quashing of the digitally signed and electronically communicated notice of demand under section 156 of the Income Tax Act, 1961, dated 12/09/2023, issued by the Respondent No.4 for the Assessment Year 2018-19 which

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NC: 2025:KHC:17387 WP No. 12163 of 2025

bears the DIN VIZ.ITBA/PNL/S/156/2023- 24/1056004927(1) and enclosed as Annexure-K2. i. Issue a writ of certiorari or any other suitable writ for quashing of the digitally signed and electronically communicated order under Section 271AAC(1) of the Income-Tax Act, 1961, dated 18/09/2023 issued by the Respondent No.4 for the Assessment Year 2018-19 which bears the DIN viz., ITBA/PNL/F/271AAC(1)/2023- 24/1056217135(1) and enclosed as Annexure-L1. j. Issue a writ of certiorari or any other suitable writ for quashing of the digitally signed and electronically communicated notice of demand under section 156 of the Income Tax Act, 1961, dated 18/09/2023, issued by the Respondent No.4 for the Assessment Year 2018-19 which bears the DIN viz.ITBA/PNL/S/156/2023- 24/1056216745(1) and enclosed as Annexure-L2. k. Issue a writ of certiorari or any other suitable writ for quashing of the digitally signed and electronically communicated notice dated 04/12/2024 directing to make payment of income tax demand issued by the Respondent No.1 for the Assessment Year 2018-19 which bears the DIN viz. ITBA/RCV/F/17/2024-25/1070872867(1) and enclosed as Annexure-M. l. Issue a writ of certiorari or any other suitable writ for quashing of the digitally signed and electronically communicated notice under section 226(3) of the Act, dated 09/01/2025 issued by the Respondent No.1 for the Assessment Year 2018-19 which bears the DIN viz.

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NC: 2025:KHC:17387 WP No. 12163 of 2025

ITBA/RCV/226(3)-1/2024-25/1072014051(1) and enclosed as Annexure-N. m. Issue a writ of mandamus or any other suitable writ for directing the Respondent No.5 to allow the petitioner to operate his bank account having current account nos.9010000006, 9014010018, 9014010036, 9014010040, 9014010067, 9014010107, 9014010109, 9014010119, 9019000630, 9019000642, 9019000646, 9019000665 that are mentioned in Annexure-N.”

2.

Heard learned counsel for the petitioner and learned counsel for the respondents and perused the material on record. 3. In addition to reiterating the various contentions urged in the memorandum of petition and referring to the material on record, learned counsel for the petitioner submits that notice issued by the respondents under Section 148A(b) of the Income Tax Act, 1961 (for short, ‘IT Act’), was not received by petitioner and he was not aware of the notice and consequently, petitioner could not submit its reply / response along with documents to the said notice. It is submitted that the inability and omission on the part of the petitioner to submit reply / response along with documents to the Section 148A(b) notice was due to bonafide reasons, unavoidable

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NC: 2025:KHC:17387 WP No. 12163 of 2025

circumstances and sufficient cause and as such, if one more opportunity is provided to the petitioner to do so by setting aside the impugned orders and notices, the petitioner would do so and respondents may be directed to proceed further in accordance with law. 4. Per contra, learned counsel for the respondents submits that there is no merit in the petition and that the same is liable to be dismissed. 5. A perusal of the impugned order will indicate that it is an undisputed fact that petitioner has not submitted reply / response along with documents to Section 148A(b) notice. Under these circumstances, in view of the specific assertion on the part of the petitioner that his inability and omission to submit a reply along with documents to Section 148A(b) notice was due to bonafide reasons, unavoidable circumstances and sufficient cause and if one more opportunity is granted, petitioner would submit reply along with documents, I deem it just and appropriate to set aside the impugned order at Annexure – C dated 26.03.2022 passed under Section 148A(b) of the Income Tax Act, the orders dated 06.03.2023 at

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NC: 2025:KHC:17387 WP No. 12163 of 2025

Annexure-J1 passed under Section 147 r/w 144 r/w 144B of the IT Act, Annexure-J2 passed under Section 156 of the IT Act, Annexure-J3 passed under Section 147 r/w 144 of the IT Act, the Orders at Annexure-K1 passed under Section 272A(1)(d) and Annexure-K2 passed under Section 156 of the Income Tax Act, both dated 12.09.2023, Annexure-L1 dated 18.09.2023 passed under Section 271AAC(1) of the IT Act, Annexure-L2 dated 18.09.2023 passed under Section 156 of the IT Act, and Annexure-N dated 09.01.2025 passed under Section 226(3) of the IT Act, subsequent notice/orders, etc., and remit the matter back to respondent No.1 for reconsideration afresh from the stage of submitting of reply by the petitioner to Section 148A(b) notice and to proceed further in accordance with law. 6. In the result, pass the following: ORDER (i) The petition is hereby allowed. (ii) Impugned notices / orders at Annexures-C, J1, J2, J3, K1, K2, K3, L1, L2 and N are hereby set aside. (iii) Matter is remitted back to respondent No.1 for reconsideration afresh in accordance with law from

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NC: 2025:KHC:17387 WP No. 12163 of 2025

the stage of submitting of reply to the Show Cause Notice under Section 148A(b) of the IT Act at Annexure-B dated 14.03.2022. (iv) Liberty is reserved in favour of the petitioner to submit additional pleadings, documents, etc., to the respondent, who shall consider the same and proceed further in accordance with law.

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

kcm List No.: 2 Sl No.: 26

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