SRI SATISH BABU EPURU vs. THE DEPUTY COMMISSIONER OF INCOME TAX

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WP/12419/2025HC KarnatakaKAHC01028419202504 July 2025Bench: SURAJ GOVINDARAJ5 pages
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What did the High Court hold?

The High Court allowed the writ petition. It held that considering the bereavement in the family of the chartered accountant, who was responsible for replying to the show cause notice on behalf of the petitioner, and the chartered accountant's subsequent inability to attend to his office, it was appropriate to grant the petitioner an opportunity to reply. The Court reasoned that this would allow the respondent to pass necessary orders on merits rather than ex-parte. Consequently, the order dated 17.03.2025 passed under Section 143(3) read with Section 144B, and the penalty notices dated 17.03.2025 issued under Section 274 read with Sections 270A and 271AAC(1), were quashed. The matter was remitted to the respondent for fresh consideration upon the petitioner submitting his reply to the show cause notice by 21.07.2025.

What were the facts?

The petitioner, Sri. Satish Babu Epuru, is challenging an order passed under Section 143(3) read with Section 144B of the Income Tax Act, 1961, dated 17.03.2025, and consequential penalty notices issued under Sections 274 read with 270A and 271AAC(1) for the Assessment Year 2023-24. The petitioner received a notice under Section 143(2) on 19.06.2024, to which he did not reply. He later replied to a notice under Section 142(1) on 12.11.2024. A show cause notice was issued on 22.02.2025, but the petitioner could not reply due to the demise of his chartered accountant's mother in late January 2025, leading to the chartered accountant's absence from office. The impugned order was passed on 17.03.2025.

What were the issues?

1. Whether the petitioner should be granted an opportunity to reply to the show cause notice, considering the bereavement in the chartered accountant's family, before the assessment order and penalty notices are finalized? Assessee's contention: The petitioner argues that the failure to reply to the show cause notice was due to unavoidable circumstances, specifically the death of the chartered accountant's mother and his subsequent absence from office. This prevented the petitioner from presenting his case, leading to an ex-parte order. The petitioner seeks an opportunity to submit a reply to the show cause notice. Revenue's contention: The judgment does not record any specific contentions from the revenue regarding the issues raised by the petitioner. The revenue is represented by counsel, but their arguments are not detailed in the provided text.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144B,Section 143(2),Section 142(1),Section 274,Section 270A,Section 271AAC(1)

AI-generated summary — verify with the full judgment below

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HC-KAR NC: 2025:KHC:24246 WP No. 12419 of 2025

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 4TH DAY OF JULY, 2025 BEFORE THE HON'BLE MR. JUSTICE SURAJ GOVINDARAJ WRIT PETITION NO. 12419 OF 2025 (T-IT) BETWEEN:

SRI. SATISH BABU EPURU PROP PROGRESSIVE ENGINEERING ENTERPRISES, AGED 47 YEARS, S/O E VEDAGIRI REDDY, NO.204, 2ND FLOOR, GANESH RESIDENCY CHAMRAJPURAM, MYSORE – 570 005 PAN AADPE6592N …PETITIONER (BY SRI. RAVI SHANKAR S V.,ADVOCATE)

AND:

1.

THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE-1(1) AND TPS, MYSORE – 570 008.

2.

NATIONAL FACELESS ASSESSMENT CENTRE, REPRESENTED BY ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/ INCOME TAX OFFICER, INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, ROOM NO. 401, 2ND FLOOR, E-RAMP, JAWAHARLAL NEHRU STADIUM, DELHI – 110 003. …RESPONDENTS (BY SRI. THIRUMALESH, ADVOCATE)

Digitally signed by SHWETHA RAGHAVENDRA Location: HIGH COURT OF KARNATAKA

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HC-KAR NC: 2025:KHC:24246 WP No. 12419 of 2025

THIS WP IS FILED UNDER ARTICLE 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO ISSUE A WRIT OF CERTIORARI OR DIRECTION IN THE NATURE OF A WRIT OF CERTIORARI QUASHING THE ORDER PASSED U/S 143(3) R.W.S 144B DATED 17/03/2025 BEARING DIN ITBA/AST/S/143(3)/2024-25/1074573265(1) PASSED BY THE RESPONDENT NO.2 FOR THE ASSESSMENT YEAR 2023-24 HEREIN MARKED AS ANNEXURE - A. AND ETC.

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

CORAM: HON'BLE MR. JUSTICE SURAJ GOVINDARAJ

ORAL ORDER

1.

The petitioner is before this Court seeking for the following reliefs: i. “Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the order passed U/s 143(3) r.w.s 144B dated 17/03/2025 DIN: bearing ITBA/AST/S/143(3)/2024-25/1074573265(1) passed by the Respondent No.2 for the assessment year 2023-24 herein marked as Annexure – A.

ii. Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the penalty notice dated 17/03/2025 issued u/s 274 r.w.s 270A of the Act bearing DIN and Notice No. ITBA/PNL/S/270A/2024-25/1074573540(1) by the Respondent No.2 for the assessment year 2023-24 herein marked as Annexure – A1.

iii. Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the penalty notice dated 17/03/2025 issued u/s 274 r.w.s 271AAC(1) of the Act bearing DIN and Notice No. TBA/PNL/S/271AAC(1)/2024-|25/1074573541(1) by the Respondent No.2 for the assessment year 2023-24 herein marked as Annexure - A2.

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HC-KAR NC: 2025:KHC:24246 WP No. 12419 of 2025

iv. And pass such other orders as this Hon'ble Court deems fit and proper in the interest of justice and equity.”

2.

Notice under Section 143(2) of the Income Tax Act, 1961 had been issued to the petitioner on 19.06.2024. The petitioner had not replied to the same. However, the petitioner replied to the notice under Section 142(1) of the Income Tax Act, 1961 on 12.11.2024 Subsequently, a show cause notice came to be issued on 22.02.2025, which was not replied to by the petitioner on account of the mother of the chartered accountant having expired in the last week of January, 2025. It is claimed that the chartered accountant not attending to his office, the said notice could not be replied to. In the meanwhile, the impugned order came to be passed on 17.03.2025. It is challenging the said order, the petitioner is before this Court.

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HC-KAR NC: 2025:KHC:24246 WP No. 12419 of 2025

3.

Considering the fact that there was a bereavement in the family of the chartered accountant, who was required to answer/reply to the show cause notice on the part of the petitioner and that the chartered accountant was not attending to his office, I am of the considerable opinion that an opportunity would be required to be granted to the petitioner to reply to the same, so that Respondent No.2 could pass necessary orders on merits rather than ex-parte as has been done. 4. In that view of the matter, I pass the following: ORDER i) The writ petition is allowed. ii) The order dated 17.03.2025 passed by respondent No.2 under Section 143 (3) read with Section 144B at Annexure-A and the penalty notice dated 17.03.2025 issued by respondent No. 2 at Annexure-A1 as well as the penalty notice dated 17.03.2025 bearing

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HC-KAR NC: 2025:KHC:24246 WP No. 12419 of 2025

No.ITBA/PNL/S/271AAC(1)/2024-25/1074573541 at Annexure-A2, are hereby quashed. iii) The matter is remitted to respondent No. 2 for fresh consideration on the petitioner submitting his reply to the show cause notice which reply shall be submitted on or before 21.07.2025.

SD/- (SURAJ GOVINDARAJ) JUDGE

KTY List No.: 2 Sl No.: 14

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