NEEDS MANPOWER SUPPORT SERVICES PRIVATE LIMITED vs. THE DEPUTY COMMISSIONER OF INCOME TAX

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WP/12930/2025HC KarnatakaKAHC01029363202510 November 2025Bench: S.R.KRISHNA KUMAR5 pages
AI SummaryRemanded

What did the High Court hold?

The High Court held that a perusal of the impugned order indicated that while the petitioner had filed its replies to the notices/letters issued by the respondents, the Assessing Officer (Respondent No. 2) had not properly considered these replies before passing the impugned order. Consequently, the Court found that the impugned notices and proceedings culminating in the impugned penalty order were violative of the principles of natural justice. Therefore, the Court set aside the impugned Assessment Order and remitted the matter back to the Assessing Officer for reconsideration. The petitioner was granted liberty to submit further responses/replies to the Section 143(2) Notice, which the Assessing Officer was directed to consider before proceeding in accordance with law. The penalty notices were also implicitly set aside as part of the remitted proceedings.

What were the facts?

The petitioner, Needs Manpower Support Services Private Limited, filed a writ petition before the High Court of Karnataka challenging an order passed under Section 143(3) read with Section 144B of the Income Tax Act, 1961, for Assessment Year 2023-24. The petitioner also challenged penalty notices issued under Section 274 read with Sections 270A and 272A(1)(d) of the Act. The petitioner contended that the Assessing Officer (Respondent No. 2) failed to properly consider the various replies filed by the petitioner in response to notices and letters issued by the revenue, thereby violating principles of natural justice. The revenue argued that the petition lacked merit and should be dismissed.

What were the issues?

1. Whether the Assessment Order dated 20.03.2025 passed under Section 143(3) read with Section 144B of the Income Tax Act, 1961, for Assessment Year 2023-24, is liable to be quashed for non-consideration of the petitioner's replies, thus violating principles of natural justice? 2. Whether the penalty notices dated 20.03.2025 issued under Section 274 read with Sections 270A and 272A(1)(d) of the Income Tax Act, 1961, are liable to be quashed on the same grounds? Assessee's Contentions: The petitioner argued that the Assessing Officer did not properly consider the numerous replies filed by the petitioner between August 2024 and March 2025. This failure to consider the submissions resulted in a violation of the principles of natural justice, making the impugned assessment order and subsequent penalty notices unsustainable. Revenue's Contentions: The revenue contended that the writ petition filed by the petitioner was devoid of merit and ought to be dismissed.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144B,Section 274,Section 270A,Section 272A(1)(d),Section 143(2)

AI-generated summary — verify with the full judgment below

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HC-KAR NC: 2025:KHC:45658 WP No. 12930 of 2025

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 10TH DAY OF NOVEMBER, 2025 BEFORE THE HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO. 12930 OF 2025 (T-IT) BETWEEN:

NEEDS MANPOWER SUPPORT SERVICES PRIVATE LIMITED A COMPANY REGISTERED UNDER THE COMPANIES ACT, 1956, NO.25, NEEDS TOWERS, 80 FEET ROAD SBM COLONY, BSK I STAGE, BENGALURU – 560 050 REPRESENTED BY ITS SENIOR MANAGER ACCOUNTS, SRI VINAY G R S/O RAMALINGAIAH SIDDEGOWDA, AGED 39 YEARS, GEJJELAGERE POST OFFICE, MADDUR TALUK, MANDYA-571 428. …PETITIONER (BY SRI. RAVI SHANKAR S V.,ADVOCATE) AND:

1.

THE DEPUTY COMMISSIONER OF INCOME TAX OF INCOME TAX, CIRCLE 5(1)(1),

BANGALORE 560 095.

2.

NATIONAL FACELESS ASSESSMENT CENTRE REPRESENTED BY ADDITIONAL/JOINT/DEPUTY

ASSISTANT COMM 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. M. THIRUMALESH, ADVOCATE)

THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER PASSED U/S 143(3) R.W.S 144B DTD. 20.03.2025 BEARING DIN ITBA/AST/S/14393)/2024- 25/1074765434(1) PASSED BY THE R-2 FOR THE ASSESSMENT YEAR 2023-24 HEREIN MARKED AS ANNX-A.

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

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HC-KAR NC: 2025:KHC:45658 WP No. 12930 of 2025

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 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 1448 dated 20/03/2025 bearing DIN: ITBA/AST/S/143(3)/2024-25/1074765434(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 20/03/2025 issued u/s 274 r.w.s 270A of the Act bearing DIN and Notice No. ITBA/PNL/S/270A/2024- 25/1074765492(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 20/03/2025 issued u/s 274 r.w.s 272A(1) (d) of the Act bearing D and Notice No. ITBA/PNL/S/272A(1)(d)_FL/2024- 25/1074758312(1) by the Respondent No.2 for the assessment year 2023-24 herein marked as Annexure-A2.

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

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HC-KAR NC: 2025:KHC:45658 WP No. 12930 of 2025

2.

Heard learned counsel for the parties and perused the material on record.

3.

In addition to reiterating various contentions urged in the petition and referring to the material on record, learned counsel for the petitioner invited my attention to the replies dated 13.08.2024, 05.09.2024, 05.12.2024, 25.02.2025, 01.03.2025, 06.03.2025, 08.03.2025 and 12.03.2025 to point out that pursuant to the Notices/ show-cause notices and Letters issued by the respondents under the petitioner filed the aforesaid replies to the said notices/ letters. Further, the 2nd respondent passed the impugned Assessment order dated 20.03.2025 under Section 143(3) read with Section 144B of the I.T. Act. Learned counsel for the petitioner pointed out to the impugned order dated 20.03.2025 in order to show that the 2nd respondent did not properly consider the replies filed by the petitioner and proceeded to pass the impugned order, thereby violating principles of natural justice and as such, the petitioner is before this Court by way of present petition.

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HC-KAR NC: 2025:KHC:45658 WP No. 12930 of 2025

4.

Per contra, learned counsel for the respondents-revenue 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 the petitioner filed its replies to the notices / letters issued by the respondents. It is also borne out from the impugned order dated 20.03.2025 that the 2nd respondent has not properly considered the replies filed by the petitioner and has proceeded to pass the impugned order. Under these circumstances, I am of the considered opinion that the impugned notices, proceedings culminating in the impugned penalty order is violative of principles of natural justice and consequently, the impugned order deserves to be set aside by adopting justice oriented approach and by directing the 2nd respondent to consider the replies filed by the petitioner and thereafter proceed further in accordance with law.

6.

In the result, I pass the following:- ORDER

(i) The petition is hereby allowed.

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HC-KAR NC: 2025:KHC:45658 WP No. 12930 of 2025

(ii) The impugned Assessment order at Annexure-A dated 23.03.2025 passed by the 2nd respondent is hereby set aside. (iii) The matter is remitted back to the 2nd respondent for reconsideration afresh in accordance with law from the stage of considering the replies filed by the petitioner. (iv) Liberty is reserved in favour of the petitioner to submit his response/reply along with the documents to the Section 143(2) Notice dated 19.06.2024 issued by the respondents, who shall consider the same and proceed further in accordance with law.

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

Srl.

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