MELAGANI CHICKAVENKATAPPA BHARGAVA RAM vs. THE INCOME TAX OFFICER

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WP/24285/2024HC KarnatakaKAHC01050809202405 February 2025Bench: S.G.PANDIT5 pages
AI SummaryRemanded

What did the High Court hold?

The High Court held that the petitioner ought to be given an opportunity to file his objections and participate in the proceedings initiated under Section 148A of the Income Tax Act, 1961. The Court noted that the petitioner is not an assessee and had no knowledge of the notice uploaded on the department's web portal. It was also observed that no individual notice was issued to the petitioner by the department, apart from uploading it on the portal. The order under Clause (b) of Section 148A was passed noting the petitioner's failure to disclose the nature and source for the purchase of immovable property. Since the notice was not served on the petitioner, he had no occasion to appear and disclose his income. Consequently, the notices dated February 17, 2023, and March 8, 2023, along with subsequent orders (Annexures C, D, and E), were quashed. The matter was remanded back to the stage of notice under Section 148A(b), granting the petitioner two weeks to file objections and directing him to appear before the respondent on February 20, 2025. The ratio decidendi is that an ex-parte order passed without proper service of notice, especially when the assessee claims lack of knowledge due to not being an assessee and not having a PAN, is unsustainable and warrants an opportunity for the assessee to be heard.

What were the facts?

The petitioner, Melagani Chickavenkatappa Bhargava Ram, filed a writ petition before the High Court of Karnataka challenging notices dated February 17, 2023, and March 8, 2023, issued under Section 148A(b) of the Income Tax Act, 1961, for Assessment Year 2016-2017. The petitioner contended that the impugned order was ex-parte and that he is not an assessee as he only has agricultural income. He further stated that although notices appeared on the department's web portal, they did not come to his notice as he does not possess a PAN. The petitioner sought an opportunity to participate in the proceedings. The Revenue admitted the order was ex-parte but submitted that notice was uploaded on the department's web portal.

What were the issues?

1. Whether the notices issued under Section 148A(b) of the Income Tax Act, 1961, for Assessment Year 2016-2017, are liable to be quashed on the grounds that they were ex-parte and not effectively served on the petitioner? Assessee's Contentions: The petitioner argued that the order under Section 148A(b) was ex-parte. He claimed he is not an assessee, possessing only agricultural income. He further contended that due to the absence of a PAN, he was unaware of the notices uploaded on the department's web portal, thus preventing him from participating in the proceedings. He relied on a previous order in W.P.No.16733/2024 where a similar matter was remanded to provide an opportunity to the petitioner. Revenue's Contentions: The Revenue admitted that the order was ex-parte but submitted that the notice under Section 148A(b) was uploaded on the department's web portal.

Which sections of the Income-tax Act were involved?

Section 148A(b),Section 148A

AI-generated summary — verify with the full judgment below

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NC: 2025:KHC:5152 WP No. 24285 of 2024

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 5TH DAY OF FEBRUARY, 2025 BEFORE THE HON'BLE MR JUSTICE S.G.PANDIT WRIT PETITION NO. 24285 OF 2024 (T-IT) BETWEEN:

MELAGANI CHICKAVENKATAPPA BHARGAVA RAM S/O M C HANUMAPPA AGED ABOUT 52 YEARS MELAGANI, EMMANATHA POST MULBAGAL- 563131 KOLAR DISTRICT. …PETITIONER (BY SRI. R CHANDRASHEKAR AND SRI KASHINATH KALMATH, ADVS. FOR SRI RAMA MURTHY R., ADV.)

AND:

THE INCOME TAX OFFICER WARD NO.1, NEW EXTENSION KOLAR-563101. …RESPONDENT (BY SRI E.I. SANMATHI, ADV.)

THIS PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO A). QUASHING THE NOTICES DATED 17.02.2023 AND 08.03.2023 ISSUED U/S 148A(B) OF THE ACT (ANNEXURE-B AND B-1) (ITBA/AST/F/148A(SCN)/2022- 23/1049881963(1)

AND ITBA/AST/F/148A(SCN)/ 2022- 23/1050512852(1)) ISSUED FOR THE ASSESSMENT YEAR 2016-2017 BY THE RESPONDENT AND ETC.

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

CORAM: HON'BLE MR JUSTICE S.G.PANDIT

Digitally signed by MARIGANGAIAH PREMAKUMARI Location: HIGH COURT OF KARNATAKA

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NC: 2025:KHC:5152 WP No. 24285 of 2024

ORAL ORDER

Heard learned counsel Sri.R.Chandrashekar and Sri.Kashinath Kalmath for Sri.Ramamurthy.R., learned counsel for the petitioner and learned counsel Sri.E.I.Sanmathi., for respondent-Revenue. Perused the writ petition papers.

2.

Learned counsel for the petitioner would submit that petitioner is before this Court questioning the order passed under Section 148A(b) of the Income Tax Act, 1961 (for short, ‘1961 Act’) and consequential orders. Learned counsel would submit that impugned order is exparte order. Learned counsel would further submit that the petitioner is not an assessee since he has only agricultural income. Though the notices appeared on the web portal of the Department, since the petitioner does not have PAN, it has not come to his notice. Thus, learned counsel would pray for an opportunity to participate in the proceedings initiated under Section 148A(b) of 1961 Act (Annexure-B1). Learned counsel for the petitioner also

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NC: 2025:KHC:5152 WP No. 24285 of 2024

places reliance on the order dated 24.07.2024 in W.P.No.16733/2024 wherein his brother has approached this Court for similar prayer, wherein this Court has remanded the matter for affording an opportunity to the petitioner therein.

3.

Per contra, learned counsel Sri.E.I.Sanmathi for Revenue admits that it is an exparte order, but he submits that notice at Annexure-B1 issued under Section 148A(b) of 1961 Act was uploaded on the web portal of the Department and prays for passing appropriate order.

4.

Having heard the learned counsel appearing for the parties and on perusal of the writ petition papers, I am of the view that it is a case where the petitioner ought to be given an opportunity to file his objections and to participate in the proceedings initiated under Section 148A of 1961 Act. Admittedly, the petitioner is not an assessee and he had no knowledge of the notice uploaded on the web portal of the Department. It is also noticed that except uploading the notice in the web portal, no

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NC: 2025:KHC:5152 WP No. 24285 of 2024

individual notice is issued to the petitioner by the Department. The order under Clause(b) of Section 148A of 1961 Act is passed noting that the assessee has failed to disclose the nature and source for purchase of the immovable property. When the notice is not served on the petitioner, there was no occasion for the petitioner to appear and disclose his income. In the above circumstances, writ petition succeeds. Hence, the following: ORDER a) Annexure-C bearing No.ITBA/AST/F/148A/ 2022-23/1051158989(1) dated23.03.2023; Annexure-D bearing No.ITBA/AST/S/148_1/ 2022-23/1051190878(1) dated 23.03.2022; and Annexure-E bearing No.ITBA/AST/S/147/ 2023-24/1061571959(1) dated 27.02.2024 are quashed.

b) The matter is remanded back to the stage of notice under Section 148A(b) of 1961 Act and

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NC: 2025:KHC:5152 WP No. 24285 of 2024

the petitioner is granted two weeks time to file objections and the petitioner shall appear before the first respondent on 20.02.2025 at 11.00 a.m. Thereafter, respondents to proceed in accordance with law.

c) With the above, writ petition stands disposed of.

Sd/- (S.G.PANDIT) JUDGE

NC CT:bms List No.: 1 Sl No.: 14

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