MAQSOOD MAHMOOD ALI vs. DEPUTY COMMISSIONER OF INCOME TAX 6(1) (1)

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WP/12500/2025HC KarnatakaKAHC01028503202525 April 2025Bench: S.R.KRISHNA KUMAR5 pages
AI SummaryAllowed

What did the High Court hold?

The High Court allowed the petition. It noted that it was undisputed that the petitioner had not submitted a reply to the Section 148A(b) notice. However, accepting the petitioner's assertion that this omission was due to bonafide reasons, unavoidable circumstances, and sufficient cause, the Court deemed it just and appropriate to grant one more opportunity. Consequently, the Court set aside the impugned order at Annexure-C (Section 148A(d)), the impugned order at Annexure-H (Section 147 r/w Section 144B), and subsequent notices/orders. The matter was remitted back to Respondent No.1 for reconsideration from the stage of submitting the petitioner's 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 law. The ratio decidendi is that where an assessee demonstrates bonafide reasons for non-compliance with procedural notices, the court may grant an opportunity to rectify the omission to ensure principles of natural justice are upheld.

What were the facts?

The petitioner, Maqsood Mahmood Ali, filed a writ petition before the High Court of Karnataka challenging various notices and orders issued by the Income Tax Department concerning Assessment Year (AY) 2017-18. The challenged actions include notices under Section 148A(b) dated 31.01.2024 and 21.02.2024, an order under Section 148A(d) dated 13.03.2024, a notice under Section 148 dated 13.03.2024, an ex-parte assessment order under Section 147 r.w.s 144 dated 02.01.2025, a notice under Section 274 r.w.s 271F dated 02.01.2025, and a notice under Section 226(3) dated 24.02.2025. The petitioner contended that he did not receive the Section 148A(b) notice as it was sent to his tax consultant's email, and he was unaware of it, thus being unable to submit a reply due to bonafide reasons and sufficient cause.

What were the issues?

1. Whether the petitioner's failure to submit a reply to the notice issued under Section 148A(b) of the Income Tax Act, 1961, was due to bonafide reasons, unavoidable circumstances, and sufficient cause, thereby warranting an opportunity to respond. The petitioner argued that the notice under Section 148A(b) was not received by him as it was sent to his tax consultant's email. He claimed ignorance of the notice and stated that his inability to submit a reply and documents was due to bonafide reasons, unavoidable circumstances, and sufficient cause. He sought an opportunity to respond by setting aside the impugned orders and notices. The revenue contended that there was no merit in the petition and it was liable to be dismissed.

Which sections of the Income-tax Act were involved?

Section 148A(b),Section 148A(d),Section 147,Section 144B,Section 148,Section 274,Section 271F,Section 226(3)

AI-generated summary — verify with the full judgment below

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NC: 2025:KHC:17198 WP No. 12500 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.12500 OF 2025 (T-IT) BETWEEN:

MAQSOOD MAHMOOD ALI, S/O. LATE MAHMOOD ALI, AGED ABOUT 64 YEARS, R/AT NO.1, ALI ESTATE, VASUDEVAPURA, YELAHANKA HOBLI, BANGALORE – 560 054. PH. NO. 95384 96829 …PETITIONER (BY SRI. SHREERAM TIMMAPPA NAYAK, ADVOCATE)

AND:

1.

DEPUTY COMMISSIONER OF INCOME TAX 6(1)(1), BMTC BUILDING, 80 FEET ROAD,

NEAR KHB GAMES VILLAGE,

KORMANGALA, BANGALORE – 560 095.

2.

PRL. COMMISSIONER INCOME TAX-1 5TH FLOOR, BMTC BUILDING,

NEAR KHB GAMES VILLAGE,

KORAMANGALA, BANGALORE – 560 095.

3.

ASSESSMENT UNIT, INCOME TAX DEPARTMENT,

MINISTRY OF FINANCE,

ROOM NO.401, 2ND FLOOR,

E-RAMP, JAWAHARLAL NEHRU STADIUM,

DELHI – 110 003. …RESPONDENTS (BY SRI. M. DILIP, ADVOCATE)

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

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NC: 2025:KHC:17198 WP No. 12500 of 2025

THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE NOTICE ISSUED UNDER SECTION 148A(B) DATED 31.01.2024 FOR AY 2017- 18 (ANNEXURE – A) ISSUED BY RESPONDENT NO.1 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

ORAL ORDER In this petition, petitioner seeks the following reliefs: i. Quash the notice issued under section 148A(b) dated 31.01.2024 for AY 2017-18 (Annexure – A) issued by the Respondent No.1. ii. Quash the notice issued under section 148A(b) dated 21.02.2024 for AY 2017-18 (Annexure – B) issued by Respondent No.1. iii. Quash the order issued under section 148A(d) dated 13.03.2024 for AY 2017-18 (Annexure – C) issued by Respondent No.1. iv. Quash the notice issued under section 148 dated 13.03.2024 for AY 2017-18 (Annexure-D) issued by Respondent No.1. v. Quash the Ex parte assessment order passed under section 147 rws 144 dated 02.01.2025 for AY 2017-18 (Annexure – E) issued by Respondent No.3.

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NC: 2025:KHC:17198 WP No. 12500 of 2025

vi. Quash the notice issued under section 274 rws 271F dated 02.01.2025 for AY 2017-18 (Annexure – G) issued by Respondent No.3. vii. Quash the Notice issued under section 226(3) to Union Bank of India by DC/ACIT 6(1)(1) of the act dated 24.02.2025 bearing no (Annexure – H) issued by the Respondent No.3; viii. Pass such other or further order as this Hon’ble Court may deem fit in the facts and circumstances of the case, and in the interests of justice and equity.” 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 as the same was sent to the e-mail Id of the tax consultant of the petitioner and he was not aware of the notice and consequently, petitioner could not submit his 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:17198 WP No. 12500 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 its 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 13.03.2024 passed under Section 148A(d) of the IT Act, impugned order at Annexure–H dated 02.01.2025 passed under Section 147 r/w Section144B of the Income Tax Act, 1961 and subsequent notice/orders, etc., and

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NC: 2025:KHC:17198 WP No. 12500 of 2025

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, H, J, K and L are hereby set aside. (iii) Matter is remitted back to respondent No.1 for reconsideration afresh in accordance with law from the stage of submitting of reply to the Notices under Section 148A(b) of the IT Act at Annexure-A and Annexure-B dated 31.01.2024 and 21.02.2024, respectively. (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 SV List No.: 2 Sl No.: 81

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