NARASINGAIAH KARADAHALLI NATARAJA vs. DEPUTY COMMISSIONER OF INCOME

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WP/21026/2024HC KarnatakaKAHC01043880202429 October 2025Bench: S.R.KRISHNA KUMAR7 pages
AI SummaryRemanded

What did the High Court hold?

The High Court allowed the petition. It set aside the impugned orders and notices dated March 30, 2022 (Annexures Q and Q1) and September 23, 2022 (Annexures S and S1). The matter was remitted back to the first respondent (Deputy Commissioner of Income Tax) for reconsideration afresh from the stage of submitting a reply to the notice dated February 17, 2021, issued under Section 142(1) of the Income Tax Act, 1961. The Court granted liberty to the petitioner to submit additional replies, pleadings, and documents, which the first respondent was directed to consider. The first respondent was also directed to provide a sufficient and reasonable opportunity to the petitioner and proceed in accordance with the law. The reasoning was based on the petitioner's assertion of bonafide reasons, unavoidable circumstances, and sufficient cause for non-compliance, adopting a justice-oriented approach.

What were the facts?

The petitioner, Narasimhaiah Karadahalli Nataraja, filed a writ petition before the High Court of Karnataka challenging orders and notices issued by the Deputy Commissioner of Income Tax and Assistant Commissioner of Income Tax. The assessment year in question is 2020-21. The impugned orders include an order passed under Section 153C read with Section 143(3) and 153D of the Income Tax Act, 1961, dated March 30, 2022, and a notice of demand under Section 156 of the Act dated March 30, 2022. Additionally, an order passed under Section 271AAC(1) of the Act dated September 23, 2022, and a notice of demand under Section 156 of the Act dated September 23, 2022, are also challenged. The petitioner's failure to respond to six notices issued under Section 142(1) of the Act, commencing from February 17, 2021, led to these orders.

What were the issues?

1. Whether the High Court should quash and set aside the impugned order passed under Section 153C r.w.s. 143(3) r.w.s. 153D of the Income Tax Act, 1961, dated March 30, 2022, and the consequential notice of demand dated March 30, 2022, for Assessment Year 2020-21, and the order passed under Section 271AAC(1) of the Act dated September 23, 2022, and the consequential notice of demand dated September 23, 2022, for Assessment Year 2020-21. The petitioner argued that their inability to respond to notices was due to bonafide reasons, unavoidable circumstances, and sufficient cause, and sought a remand for fresh consideration. The revenue contended that the petition had no merit and was liable to be dismissed.

Which sections of the Income-tax Act were involved?

Section 153C,Section 143(3),Section 153D,Section 156,Section 271AAC(1),Section 142(1)

AI-generated summary — verify with the full judgment below

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HC-KAR NC: 2025:KHC:43180 WP No. 21026 of 2024

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 29TH DAY OF OCTOBER, 2025 BEFORE THE HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO. 21026 OF 2024 (T-IT) BETWEEN:

NARASINGAIAH KARADAHALLI NATARAJA, AGED ABOUT 50 YEARS, R/A OPP. CANARA BANK, SHIMSA MEDICALS, B H ROAD, BHADRAVATHI - 577 301, SHIVAMOGGA, PAN : AJFPN9860R …PETITIONER (BY SRI BALRAM R RAO, ADVOCATE)

AND:

1.

DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE - 1(4), III FLOOR, C.R. BUILDING, QUEENS ROAD, BENGALURU 560 001.

2.

ASSISTANT COMMISSIONER OF INCOME TAX CENTRAL CIRCLE - 1(4), CENTRAL REVENUE BUILDING, QUEENS ROAD, BENGALURU 560 001. …RESPONDENTS (BY SRI M DILIP, ADVOCATE FOR R-1 & R-2)

THIS W.P IS FILED UNDER ARTICLES 226 AND 227 OF CONSTITUTION OF INDIA PRAYING TO DIRECT UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA, CALLING FOR THE RECORDS OF THE PETITIONER'S CASE AND AFTER EXAMINING THE LEGALITY AND VALIDITY THEREOF BE PLEASED TO QUASH AND SET ASIDE THE IMPUGNED ORDER PASSED UNDER SECTION 153C R.W.S 143(3) R.W.S 153D OF THE INCOME TAX ACT DATED 30.03.2022 IN DIN NO. ITBA/AST/M/153C/2021-22/1042030414(1) FOR THE ASSESSMENT YEAR 2020-21 (ANNEXURE-Q) AND NOTICE OF DEMAND DATED 30.03.2022 ISSUED U/S 156 OF THE ACT HAVING DIN: ITBA/AST/M/153C/2021- 228/1042030419(1) FOR THE ASSESSMENT YEAR 2020-21 (ANNEXURE- Q1) IMPUGNED ORDER PASSED UNDER SECTION 271AAC(1) OF THE

Digitally signed by NANDINI R Location: HIGH COURT OF KARNATAKA

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HC-KAR NC: 2025:KHC:43180 WP No. 21026 of 2024

INCOME TAX ACT DATED 23.09.2022 IN DIN NO. ITBA/PNL/F/271AAC(1)/2022-23/1045877464(1) FOR THE ASSESSMENT YEAR 2020-21 (ANNEXURE-S) AND NOTICE OF DEMAND DATED. 23.09.2022 ISSUED U/S 156 OF THE ACT HAVING DIN.ITBA/PNL/S/156/2022-23/1045877454(1) FOR THE ASSESSMENT YEAR 2020-21 (ANNEXURE-S1) 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 1. In this petition, petitioner seeks following reliefs: "WHEREFORE, the petitioner therefore prays that this Hon'ble Court may be pleased to: (1) Issue a Writ of Certiorari or writ in the nature of certiorari or any other appropriate writ order or direction under Article 226 of the Constitution of India, calling for the records of the petitioner's case and after examining the legality and validity thereof be pleased to quash and set aside the impugned order passed under section 153C r.w.s. 143(3) r.w.s. 153D of the Income Tax Act dated 30.03.2022 in DIN No: 22/1042030414(1) for the Assessment Year 2020-21 [ANNEXURE - Q] and notice of demand dt. 30.03.2022 issued u/s. 156 of the Act having DIN: ITBA/AST/M/153C/2021- 22/1042030419(1) for the Assessment Year 2020-21 [ANNEXURE Q1], impugned order passed under section 271AAC(1) of the Income Tax Act dated 23.09.2022 in DIN No: ITBA/PNL/F/271AAC(1)/2022-23/1045877464(1) for the Assessment Year 2020-21 [ANNEXURE-S] and notice of demand dt. 23.09.2022 issued u/s, 156 of the Act having DIN:

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HC-KAR NC: 2025:KHC:43180 WP No. 21026 of 2024

ITBA/PNL/S/156/2022-23/1045877454(1) for the Assessment Year 2020-21 [ANNEXURE-S1].

(2) Issue writ of mandamus or a writ in the nature of mandamus or any other appropriate writ, order or direction under Article 226 of Constitution of India ordering and directing the respondents by withdrawing and canceling the impugned order passed under section 153C r.w.s. 143(3) r.w.s. 153D of the Income Tax Act dated 30.03.2022 in DIN No: ITBA/AST/M/153C/2021-22/1042030414(1) for the Assessment Year 2020-21 [ANNEXURE - Q] and notice of demand dt. 30.03.2022 issued u/s. 156 of the Act having DIN: ITBA/AST/M/153C/2021-22/1042030419(1) for the Assessment Year 2020-21 [ANNEXURE Q1], impugned order passed under section 271AAC(1) of the Income Tax Act dated 23.09.2022 in DIN No: ITBA/PNL/F/271AAC(1)/2022- 23/1045877464(1) for the Assessment Year 2020-21 [ANNEXURE-S] and notice of demand dt. 23.09.2022 issued u/s. 156 of the Act having DIN: ITBA/PNL/S/156/2022- 23/1045877454(1) for the Assessment Year 2020-21 [ANNEXURE - S1];

(3) Issue a writ of prohibitio or a writ in the nature of prohibitio or any other appropriate writ, order or direction under Article 226 of Constitution of India prohibiting and restraining the respondents by themselves, their sub ordinates, servants and agents from taking any action in furtherance or consequent to impugned order passed under section 153C r.w.s. 143(3) r.w.s. 153D of the Income Tax Act dated 30.03.2022 in DIN No: ITBA/AST/M/153C/2021-22/1042030414(1) for the

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HC-KAR NC: 2025:KHC:43180 WP No. 21026 of 2024

Assessment Year 2020-21 [ANNEXURE Q] and notice of demand dt. 30.03.2022 issued u/s. 156 of the Act having DIN: ITBA/AST/M/153C/2021-22/1042030419(1) for the Assessment Year 2020-21 [ANNEXURE-Q1], impugned order passed under section 271AAC(1) of the Income Tax Act dated 23.09.2022 in DIN NO: ITBA/PNL/F/271AAC(1)/2022- 23/1045877464(1) for the Assessment Year 2020-21 [ANNEXURE S] and notice of demand dt. 23.09.2022 issued u/s. 156 of the Act having DIN: ITBA/PNL/S/156/2022- 23/1045877454(1) for the Assessment Year 2020-21 [ANNEXURE - S1].

(4) Issue such other order, writ or direction as the Hon'ble Court deems fit and direct the respondents to pay the cost of this writ petition."

2.

Heard learned counsel for the petitioner, learned counsel for respondents and perused the material on record.

3.

A perusal of the impugned assessment order will indicate that six notices from 17.02.2021 onwards were issued to the petitioner under Section 142(1) of the Income Tax Act, 1961, who did not submit any response/reply to the same, as a result of the same, 1st respondent proceeded to pass the impugned assessment order followed by consequent notices, all of which are assailed in the present petition.

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HC-KAR NC: 2025:KHC:43180 WP No. 21026 of 2024

4.

It is submitted that the inability and omission on the part of the petitioner to submit reply / response along with documents to the notices commencing from 17.2.2021 issued under Section 142(1) of the Income Tax Act, 1961 was due to bonafide reasons, unavoidable circumstances and sufficient cause and as such, if the impugned order and consequent notices are set aside and matter is remitted back to the 1st respondent for reconsideration afresh from the stage of submitting reply to the notice under Section 142

(1) of Income Tax Act, 1961, dated 17.2.2021, the petitioner would do so and 1st respondent may be directed to proceed further in accordance with law. 5. Per contra, learned counsel for the respondents submits that there is no merit in the petition and the same is liable to be dismissed. 6. A perusal of the impugned assessment order will indicate that to the notices issued from 17.02.2021 onwards, the petitioner assesee has not responded and the said proceedings culminated in the impugned assessment order. 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 was

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HC-KAR NC: 2025:KHC:43180 WP No. 21026 of 2024

due to bonafide reasons, unavoidable circumstances and sufficient cause and by adopting justice oriented approach, I deem it just and appropriate to set aside the impugned orders at Annexures – Q,Q1,S, and S1 passed under the Income Tax Act, 1961 and subsequent notice / orders, etc., and remit the matter back to 1st respondent for reconsideration afresh to the stage of submitting of reply by the petitioner to the notice dated 17.2.2021 issued under section 142 (1) of Income Tax Act, 1961 and to proceed further in accordance with law. 6. In the result, I pass the following: ORDER (i) The petition is hereby allowed. (ii) Impugned notices / orders dated 30.03.2022 at Annexures Q and Q1 and dated 23.09.2022 at Annexures-S and S1 passed by the respondents 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 Show Cause Notice under Section 142(1) of the IT Act dated 17.12.2021 onwards.

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HC-KAR NC: 2025:KHC:43180 WP No. 21026 of 2024

(iv) Liberty is reserved in favour of the petitioner to submit additional replies/pleadings, documents, etc., to the respondent, to the afore said notices which shall be considered by the 1st respondent, who shall provide sufficient and reasonable opportunity to the petitioner and proceed further in accordance with law.

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

tsn* List No.: 1 Sl No.: 25

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