ACQUA BOREWELLS PRIVATE LIMITED vs. THE ADDL. COMMISSIONER OF INCOME TAX

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WP/29557/2018HC KarnatakaKAHC01055632201806 November 2025Bench: S.R.KRISHNA KUMAR3 pages
AI SummaryAllowed

What did the High Court hold?

The High Court allowed the writ petition. It noted that the impugned penalty order and demand notice dated June 29, 2018, were issued subsequent to the filing of the petitioner's earlier writ petition (W.P.No.6403/2018) which challenged the assessment order dated December 31, 2017. The Court referred to its own final order dated November 6, 2025, in W.P.No.6403/2018, where it had allowed the petition and quashed the notice dated March 30, 2017, the assessment order dated December 31, 2017, the demand notice dated December 31, 2017, and the penalty notice dated December 31, 2017, along with all further proceedings. Consequently, in view of the quashing of the earlier proceedings, the High Court held that the penalty order and demand notice dated June 29, 2018, were also liable to be quashed. The operative direction was to quash the impugned penalty order and demand notice.

What were the facts?

The petitioner, Acqua Borewells Private Limited, is challenging a penalty order dated June 29, 2018, passed by the Income Tax Officer (Respondent No. 2) under Section 271(1)(c) of the Income Tax Act, 1961, for Assessment Year 2010-11. This penalty order and a consequential demand notice were issued during the pendency of a previous writ petition filed by the petitioner (W.P.No.6403/2018) which challenged an assessment order dated December 31, 2017, and related notices. The present writ petition seeks to quash the penalty order and demand notice dated June 29, 2018.

What were the issues?

1. Whether the penalty order and demand notice dated June 29, 2018, passed by Respondent No. 2 under Section 271(1)(c) and Section 156 of the Income Tax Act, 1961, for AY 2010-11, are liable to be quashed. The petitioner argued that these impugned orders were passed during the pendency of a previous writ petition (W.P.No.6403/2018) that challenged the underlying assessment order. The petitioner sought the quashing of the penalty order and demand notice. The revenue's contentions were not recorded in the judgment.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 156

AI-generated summary — verify with the full judgment below

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HC-KAR NC: 2025:KHC:45019 WP No. 29557 of 2018

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 6TH DAY OF NOVEMBER, 2025 BEFORE THE HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO. 29557 OF 2018 (T-IT)

BETWEEN:

ACQUA BOREWELLS PRIVATE LIMITED A PRIVATE LIMITED COMPANY INCORPORATED UNDER THE COMPANIES ACT, 1956, OFFICE AT 7TH MILE, BREWERY HOUSE, KANAKPURA ROAD, BENGALURU-560 062, REPRESENTED BY ITS DIRECTOR, SRI. K. L. SWAMY. …PETITIONER ( BY SRI. SHANKAR.A., SENIOR ADVOCATE FOR SRI. S. SUKUMAR & SMT. SWATHI SUKUMAR, ADVOCATES)

AND:

1.

THE ADDL. COMMISSIONER OF INCOME TAX RANGE-1 (1), BMTC BUILDING, 80 FEET ROAD, 6TH BLOCK, KORAMANGALA, BENGALURU-560 095.

2.

THE INCOME TAX OFFICER WARD-1 (1) (1), ROOM NO. 201, 2ND FLOOR, BMTC BUILDING, 80 FEET ROAD, 6TH BLOCK, KORAMANGALA, BENGALURU - 560 095. …RESPONDENTS (BY SRI. M. DILIP & SRI. Y.V. RAVIRAJ, ADVOCATES)

THIS W.P IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER OF PANALTY PASSED BY RESPONDENT NO.2 UNDER SECTION 271 (1)(c) OF THE ACT, DATED 29.06.2018 MARKED AS ANNEXURE-A FOR THE A.Y.2010-11 AND ETC.

THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

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

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HC-KAR NC: 2025:KHC:45019 WP No. 29557 of 2018

CORAM: HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR

ORAL ORDER

In this petition, petitioner seeks for the following reliefs:-

“ a) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the order of penalty passed by Respondent NO.2 under Section 271(1) (c) of the Act, dated: 29.06.2018 marked as Annexure-A for the A.Y. 2010-11.

b) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the notice of demand issued U/s 156 of the Act pursuant to the above impugned penalty order passed u/s 271(1)(c) of the Act, by the Respondent No. 2 on 29.06.2018 for the assessment years 2010-11 marked as Annexrue-A1.

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

2.

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

3.

A perusal of the material on record will indicate that the impugned penalty order dated 29.06.2018 and demand notice dated 29.06.2018 were preceded by assessment order dated 31.12.2017, notices etc., all of which were assailed by the

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HC-KAR NC: 2025:KHC:45019 WP No. 29557 of 2018

petitioner herein W.P.No.6403/2018 filed on 12.02.2018, during the pendency of which, the 2nd respondent has passed the impugned penalty order and issued the impugned demand notice, both dated 29.06.2018 which are assailed in the present petition.

4.

By final order dated 06.11.2025, this Court allowed the aforesaid W.P.No.6403/2018 as hereunder:- 12. In the result, I pass the following:- ORDER

(i) Petition is hereby allowed.

(ii) The impugned notice at Annexure-A1 dated 30.03.2017, Order at Annexure-A2 dated 31.12.2017, demand notice at Annexure-A3 dated 31.12.2017 and penalty notice at Annexure-A4 dated 31.12.2017 and all further proceedings pursuant thereto are hereby quashed.

In view of the aforesaid order passed in W.P.No.6403/2018 dated 06.11.2025, the impugned penalty order and demand notice both dated 29.06.2018 at Annexures-A and A1 are also hereby quashed.

6.

Petition is allowed accordingly.

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

SV/SRL

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