MR. SURESH KUMAR CHANNAPPA vs. DEPUTY COMMISSIONER OF INCOME TAX,

PDF · subscribers
WP/18145/2025HC KarnatakaKAHC01040676202502 July 2025Bench: SURAJ GOVINDARAJ8 pages
AI SummaryAllowed

What did the High Court hold?

The High Court allowed the writ petition. The Court found that there was no document placed on record evidencing service of notice on the petitioners, who were legal heirs of the deceased assessee. Consequently, the assessment and penalty orders could not have been passed against them without proper notice and service. The Court quashed the assessment order dated 11.03.2024, the notice of demand dated 11.03.2024, the penalty order dated 30.09.2024, the notice of demand dated 30.09.2024, and the computation sheet dated 30.09.2024. The matter was remitted to the first respondent (Deputy Commissioner of Income Tax) for fresh consideration. The petitioners were directed to appear on 22.07.2025, and the department was permitted to bring any other legal heirs of Sri Channappa on record. Contentions regarding the Section 148 notice were kept open.

What were the facts?

The petitioners, Mr. Suresh Kumar Channappa and Mr. Mahesh Kumar Channappa, are legal heirs of the late Sri Channappa. They filed a writ petition before the High Court of Karnataka challenging assessment orders, demand notices, and penalty orders for Assessment Year 2013-14. Their primary grievance was that they, as legal heirs of the deceased assessee Sri Channappa, were not brought on record by the Income Tax Department. The assessment proceedings were initiated against the deceased, and only his wife and one sibling were brought on record, excluding the petitioners. The petitioners contended that they should have been provided an opportunity to present their case. The Revenue submitted that notices had been issued to the petitioners, but could not produce proof of service, only dispatch receipts.

What were the issues?

1. Whether the assessment order dated 11.03.2024, notice of demand dated 11.03.2024, penalty order dated 30.09.2024, notice of demand dated 30.09.2024, and computation sheet dated 30.09.2024, passed under Sections 144, 147, 156, and 271(1)(c) of the Income-tax Act, 1961, are liable to be quashed for not bringing all legal heirs of the deceased assessee on record. (Mixed question of law and fact, turning on principles of natural justice and procedural fairness under the Income-tax Act, 1961). Assessee's contention: The petitioners, as legal heirs of the late Sri Channappa, were not brought on record, and thus, the assessment and penalty proceedings were vitiated. They sought an opportunity to present their submissions. Revenue's contention: Notices had been issued to the petitioners, and the original file was available for inspection. However, they could not produce acknowledgment of service, only dispatch receipts.

Which sections of the Income-tax Act were involved?

Section 144,Section 147,Section 156,Section 271(1)(c),Section 148

AI-generated summary — verify with the full judgment below

- 1 -

HC-KAR NC: 2025:KHC:23775 WP No. 18145 of 2025

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 2ND DAY OF JULY, 2025 BEFORE THE HON'BLE MR. JUSTICE SURAJ GOVINDARAJ WRIT PETITION NO. 18145 OF 2025 (T-IT) BETWEEN:

1.

MR. SURESH KUMAR CHANNAPPA AGED 56 YEARS, SON OF LATE SHRI CHANNAPPA RESIDING AT NO. 391/141, 19TH MAIN ROAD, NEAR NARAYANA COLLEGE, 1ST BLOCK, RAJAJINAGAR, BANGALORE – 560 010. 2. MR. MAHESH KUMAR CHANNAPPA AGED ABOUT 45 YEARS, SON OF LATE SHRI CHANNAPPA, RESIDING AT 116, 6TH MAIN ROAD, 2ND STAGE, MALAGALA BUS STOP, 8TH BLOCK, NAGARBHAVI. BANGALORE – 560 072

…PETITIONERS (BY SRI. SANDEEP HUILGOL.,ADVOCATE)

AND:

1.

DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 2(4), BENGALURU C.R. BUILDING, NO. 1, QUEENS ROAD, BENGALURU – 560 001.

2.

INCOME-TAX OFFICER (INV.), UNIT 1(1), BENGALURU

Digitally signed by SHWETHA RAGHAVENDRA Location: HIGH COURT OF KARNATAKA

- 2 -

HC-KAR NC: 2025:KHC:23775 WP No. 18145 of 2025

CENTRAL REVENUE BUILDING, NO. 1, QUEENS ROAD, BENGALURU – 560 001

3.

PRINCIPAL COMMISSIONER OF INCOME TAX, BENGALURU 2, CENTRAL REVENUE BUILDING, NO. 1, QUEENS ROAD, BENGALURU – 560 001

4.

PRINCIPAL COMMISSIONER OF INCOME-TAX, CENTRAL BANGALORE CENTRAL REVENUE BUILDING, NO. 1, QUEENS ROAD, BENGALURU – 560 001

5.

ADDITIONAL COMMISSIONER OF INCOME-TAX, CENTRAL RANGE 2, BENGALURU CENTRAL REVENUE BUILDING, NO. 1, QUEENS ROAD, BENGALURU – 560 001 6. ASSISTANT COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE 2(4), BENGALURU, CENTRAL REVENUE BUILDING, NO. 1, QUEENS ROAD, BENGALURU – 560 001

7.

DIRECTOR GENERAL OF INCOME-TAX (INV.) CENTRAL REVENUE BUILDING, NO. 1, QUEENS ROAD, BENGALURU – 560 001. …RESPONDENTS (BY SRI.Y.V.RAVIRAJ AND SRI.M.DILIP, ADVOCATES FOR R1 TO R7)

THIS WP IS FILED UNDER ARTICLE 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO-(I) QUASHING THE IMPUGNED ASSESSMENT ORDER DATED 11.03.2024 BEARING DIN AND ORDER NO.ITBA/AST/M/147/202-324/1062398818(1)

- 3 -

HC-KAR NC: 2025:KHC:23775 WP No. 18145 of 2025

PASSED BY THE 1ST RESPONDENT UNDER SECTION 144 READ WITH SECTION 147 OF THE INCOME-TAX ACT, 1961 FOR THE ASSESSMENT YEAR 2013-14 (ANNEXURE -A).(II) QUASHING THE IMPUGNED NOTICE OF DEMAND DATED 11.03.2024 BEARING DIN AND ORDER NO. ITBA/AST/M/147/202- 324/1062398818(1) ISSUED BY THE 1ST RESPONDENT UNDER SECTION 156 OF THE INCOME-TAX ACT, 1961 FOR THE ASSESSMENT YEAR 2013-14 (ANNEXURE-A-1) AND ETC.

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

CORAM: HON'BLE MR. JUSTICE SURAJ GOVINDARAJ

ORAL ORDER

1.

The petitioners are before this Court seeking the following relief: a) “Quashing the Impugned Assessment Order dated 11.03.2024 bearing DIN and Order No. ITBA/AST/M/147/202-324/1062398818(1) passed by the 1st Respondent under Section 144 read with Section 147 of the Income-tax Act, 1961 for the Assessment Year 2013-14 (Annexure 'A'); b) Quashing the Impugned Notice of Demand dated 11.03.2024 bearing DIN ,and Order No. ITBA/AST/M/147/202- 324/106239818(1) issued by the 1st Respondent under Section 156 of the Income-tax Act, 1961 for the Assessment Year 2013-14 (Annexure 'A-1'); c) Quashing the Impugned Penalty Order dated 30.09.2024 bearing DIN No. ITBA/PNL/M/271(1)(c)/2024- 25/1069246591(1) passed by the 6th Respondent under Section 271(1)(c) of the Income-tax Act, 1961 for the Assessment Year 2013-14 (Annexure 'B');

- 4 -

HC-KAR NC: 2025:KHC:23775 WP No. 18145 of 2025

d) Quashing the Impugned Notice of Demand dated 30.09.2024 bearing DIN and Order No. ITBA/PNL/S /156/ 2)/2024-25/1069269361(1) issued by the 6th Respondent under Section 156 of the Income- tax Act, 1961 for the Assessment Year 2013-14 (Annexure 'B-1'); e) Quashing the impugned computation sheet dated 30.092024 ITBA/PNL/M/271(1)(C)/2024- 25/1069246591 bearing din No. 2024201340419249160T issued by the 6th Respondent under various provisions of the Income-tax Act, 1961 for the Assessment Year 2013-14 (Annexure 'B-2'); f) Quashing the Impugned Notice dated 31.03.2023 bearing DIN and Notice No. ITBA/COM/M/17/2022- 23/1051782106(1) issued by the 1st Respondent under Section 148 of the Income-tax Act, 1961 for the Assessment Year 2013-14 (Annexure 'H'); and in so as per as petitioner. g) Pass such order or further orders 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.

A short grievance of the petitioners is that the petitioners, being the legal heirs of Sri late Channappa, were not brought on record as legal heirs of the said Sri Channappa by the second respondent in terms of the order at Annexure-A dated 11.03.2024. 3. The submission of Sri Sandeep Hoilgol, learned counsel for the petitioners, is that the assessment

- 5 -

HC-KAR NC: 2025:KHC:23775 WP No. 18145 of 2025

was regarding the late Sri Channappa, and as such, all his legal heirs are to be brought on record. Only his wife and another sibling have been brought on record. The petitioners, who are also the children of the late Sri.Channappa, had not been brought on record. And as such, he submits that an opportunity has to be provided to the petitioners to place their say on record to enable respondent No. 1 to pass appropriate orders. 4. Sri M.Dilip, learned counsel for the respondents submits that notice had been issued to the petitioners and in regard thereto, the original file is made available for inspection with the original registered post receipts. 5. On enquiry with him as to whether the said notice has been served on and any acknowledgment is available, he is unable to place the same on record since what is maintained by the Income Tax Department is only the receipts issued by the Postal

- 6 -

HC-KAR NC: 2025:KHC:23775 WP No. 18145 of 2025

Department for registered post which have been dispatched by the Income Tax Department. 6. It is rather surprising that the Postal Department and the Income Tax Department have not been integrated. When this Court has integrated with the Postal Department to provide real-time tracking of all the notices issued by this Court to the concerned litigants, it would be for the Income Tax Department also to have proper postal integration, and thereby proper and adequate records are maintained as regards service of notices by the registered post acknowledgment due. Of course, this being in respect of notices served otherwise through by way of email. 7. In view of the fact that there is no document that has been placed on record evidencing service of notice on the petitioners and the petitioners being on record as legal heirs of the late Sri.Channappa, I am of the considered opinion that orders could not have

- 7 -

HC-KAR NC: 2025:KHC:23775 WP No. 18145 of 2025

been passed by respondent No.1 against the petitioners by showing them as parties to the said order without there being a notice issued and served. 8. In that view of the matter, I pass the following :ORDER: a) The writ petition is allowed. b) The assessment order dated 11.03.2024 at Annexure-A, the impugned notice of demand dated 11.03.2024 at Annexure- A1, the penalty order dated 30.09.2024 at Annexure-B, the impugned notice of demand dated 30.09.2024 at Annexure-B1 and the impugned computation sheet dated 30.09.2024, are quashed. c) The matter is remitted to the first respondent for fresh consideration. d) Since the order is passed in the presence of learned counsel for the petitioners and the respondents, the petitioners shall appear before respondent No.1 without requirement of any further notice at 2.30 p.m. on 22.07.2025.

- 8 -

HC-KAR NC: 2025:KHC:23775 WP No. 18145 of 2025

e) Any documents relied upon by the petitioners and any objections to be filed by the petitioners shall be filed on the very same date. f) Respondent No.1 is directed to consider the said objections and permit the petitioners to examine and cross-examine the witnesses in the matter and after hearing the petitioners to pass necessary orders in accordance with law. g) All contentions in respect of the Section 148 notice are kept open. h) If there are any other legal heirs of Sri.Channappa, the department is permitted to bring them on record. i) Though the above petition is allowed, to report compliance with para 6 above, re-list on 30.07.2025.

KTY/List No.: 1 Sl No.: 48 SD/- (SURAJ GOVINDARAJ) JUDGE

More judgments on Section 147

All 49,210 judgments and leading authorities on Section 147 →

Recent GST High Court judgments

Search GST case law →