Sadashivanagar Youth Association Vs Income Tax Officer — Income Tax | Karnataka HC (2025)

Sadashivanagar Youth Association Vs Income Tax Officer — Income Tax | Karnataka HC (2025)

What the court decided

AI extract

Outcome

Quashing of the impugned assessment orders, notices, demand notices, penalty orders and attachment notices (Annexures B, C, D, L, L1 and M in W.P.No.13055/2025; Annexures A, B, D, E, F, G, H and J series in W.P.No.15078/2025), with liberty to the petitioner to respond to the Section 148A(b) notice by 30.06.2025 and to the respondents to consider the response and pass fresh orders; petitioner barred from raising the limitation ground; jurisdictional plea left undecided.

Issue for consideration

Whether the assessment orders and allied notices/demand/penalty orders were validly passed when the petitioner asserts it was not served with the statutory notices (under Section 148A / Section 142(1)) of the IT Act and thus had no opportunity to reply. +2 more

Court's answer

On the pattern of its earlier order in W.P. No.10973/2025 and the petitioner's assertion of non-service of notices under Section 148A, the Court held that the petitions must be allowed-in-part by quashing the assessment orders and attachment orders, so that the petitioner gets another opportunity.

Ratio / Principle

Operative direction: the impugned assessment orders, notices and attachment orders under Sections 148A(d), 144 read with 144B and the notices under Section 226(3) are quashed in W.P.No.13055/2025 (Annexures B, C, D, L, L1, M) and in W.P.No.15078/2025 (Annexures A, B, D, E, F, G, H and J series).

Key takeaways

The petitioner is reserved liberty to file a response to the notice under Section 148A(b) of the IT Act by 30.06.2025, with liberty to the respondents to consider the same and pass such orders afresh.ratio¶103
The quashing is conditional: the petitioner shall not be entitled to raise the ground of limitation in the fresh proceedings.ratio¶93
No opinion is rendered on the petitioner's jurisdictional plea; all aspects must be considered afresh (point expressly left open).obiter

Detailed headnote1 paragraphs

High Court of Karnataka (B M Shyam Prasad J), 05.06.2025: Allowed-in-part two connected writ petitions by Sadashivanagar Youth Association challenging, for AY 2018-19 and AY 2020-21, assessment orders under S.147 r/w Ss.144 and 144B of the Income Tax Act, 1961, demand notices under S.156, penalty orders under Ss.272A(1)(d) and 270A, and attachment notices under S.226(3) issued to its bankers. Relying on its earlier order in W.P. No.10973/2025 (AY 2017-18), the Court found the petitioner was not served with the statutory notices (under S.148A / S.142(1)) and quashed Annexures B, C, D, L, L1 and M (W.P.13055/2025) and Annexures A, B, D, E, F, G, H and J series (W.P.15078/2025), granting the petitioner liberty to reply to the S.148A(b) notice by 30.06.2025 and the Department liberty to pass fresh orders. The petitioner was, however, disentitled from raising a limitation ground, and no opinion was expressed on the jurisdictional plea, all aspects being left open for fresh consideration.

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 5^TH DAY OF JUNE, 2025

BEFORE

THE HON'BLE MR JUSTICE B M SHYAM PRASAD

WRIT PETITION NO. 13055 OF 2025 (T-IT)

C/W

WRIT PETITION NO. 15078 OF 2025 (T-IT)

IN WP No. 13055/2025

BETWEEN:

SADASHIVANAGAR YOUTH ASSOCIATION 30/A, 8TH A MAIN RAJMAHAL VILAS, REPRESENTED BY ITS PRESIDENT SADASHIVANAGAR S.O BANGALORE - 560080. REPRESENTED BY ITS PRESIDENT MR. W.P. SHIVAKUMAR, AGED ABOUT 68 YEARS,

Digitally signed by VANAMALA N Location: High Court of Karnataka

(BY SRI. BALRAM R RAO., ADVOCATE)

AND:

INCOME TAX OFFICER WARD 6(3)(1), BANGALORE BMTC BUILDING, KORAMANGALA, BENGALURU-560095.

…PETITIONER

ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX,

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NATIONAL FACELESS ASSESSMENT CENTRE, INCOME TAX DEPARTMENT, DELHI II FLOOR E-RAMP JAWAHARLAL NEHRU STADIUM DELHI 110003

BANK OF INDIA SANJAY NAGAR BRANCH BENGALURU 560 094

…RESPONDENTS

(BY SRI. M. DILIP, ADVOCATE FOR R1 AND R2)

THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH AND SET ASIDE THE IMPUGNED ORDER PASSED UNDER SECTION 147 R.W.S.144 R.W.S 144B OF THE ACT DATED 02.01.2025 IN DIN AND ORDER NO.ITBA/AST/S/147/2024-25/1071823250(1) (ANNEXURE-L) AS WELL AS NOTICE OF DEMAND NOTICE DATED 02.01.2025 ISSUED UNDER SECTION 156 OF THE ACTIN DIN AND NOTICE NO.ITBA/AST/S/156/2024-25/1071824142(1) (ANNEXURE-L1) PASSED BY THE 2^ND RESPONDENT FOR THE ASSESSMENT YEAR 2020-21 AS WELL AS THE NOTICE ISSUED UNDER SECTION 226(3) OF THE ACT, DATED 10.03.2025 IN DIN AND NOTICE NO.ITBA/RVC/S/226(3) 1/2024-25/1074262052, (ANNEXURE-M) PASSED BY THE 1^ST RESPONDENT FOR THE ASSESSMENT YEAR 2020-21 AND ETC.,

IN WP NO. 15078/2025

BETWEEN:

SADASHIVANAGAR YOUTH ASSOCIATION REGD PREVIOUSLY AT30/A, 8TH MAIN RAJMAHAL VILLAS, SADASHIVANAGAR S.O

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BANGALORE-560080, KARNATAKA PRESENTLY ATCA SITE, SRI PRASANNA GANAPATHI SANNIDHI, 15TH CROSS, 8TH MAIN, SADASHIVANAGAR, BANGALORE-560080, KARNATAKA. REPRESENTED BY ITS PRESIDENTMR. W.P. SHIVAKUMAR, AGED ABOUT- 68 YEARS,

...PETITIONER

(BY SRI. BALRAM R RAO.,ADVOCATE)

AND:

INCOME TAX OFFICER WARD 6(3)(1), BANGALORE BMTC BUILDING, KORAMANGALA, BENGALURU-560095.

ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX, NATIONAL FACELESS ASSESSMENT CENTRE, INCOME TAX DEPARTMENT, DELHI, II FLOOR, E-RAMP, JAWAHARLAL NEHRU STADIUM, DELHI-110003.

THE MANAGER,

UNION BANK OF INDIA, NO. 163, 9TH MAIN, 3RD CROSS, RAJAMAHAL VILAS EXTENSION, BANGALORE -560 080

THE MANAGER, BANK OF INDIA, NOS. 1 AND24, RAGHOTHAMAN SMARAKA SAHAKARA KENDRA, RMS COLONY,

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SANJAYANAGARA, BANGALORE 560094

...RESPONDENTS

(BY SRI. M. DILIP, ADVOCATE FOR R1 AND R2)

THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH AND SET ASIDE THE IMPUGNED COMPUTATION SHEET IN DIN AND NOTICE NO. ITABA/AST/S/185/2022-23/1051692985(1), DATED 30.03.2023 (ANNEXURE-E) AS WELL AS NOTICE OF DEMAND DATED 30.03.2023 ISSUED UNDER SECTION 156 OF THE ACT IN DIN AND NOTICE NO. ITBA/AST/S/156/2022-23/1051692890(1) DATED 30.03.2023 (ANNEXURE-F) PASSED BY THE 1ST RESPONDENT AS WELL AS IMPUGNED PENALTY ORDER PASSED UNDER SECTION 272A(1)(d) AND 270A OF THE ACT, IN DIN AND NOTICE NO. ITBA/PNL/F/272A(1)(d)/2023-24/1055532780(1) ITBA/PNL/F/270A/2023-24/1056490105(1) DATED 28.08.2023 AND 25.09.2023 (ANNEXURE-G) AND (ANNEXURE-H) PASSED BY THE 2ND RESPONDENT FOR THE ASSESSMENT YEAR 2018-19DIRECTION UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA ORDERING AND DIRECTING THE RESPONDENTS BY THEMSELVES, THEIR SUBORDINATE, SERVANTS AND AGENTS TO WITHDRAW AND CANCEL THE IMPUGNED COMPUTATION SHEET IN DIN AND NOTICE NO. ITABA/AST/S/185/2022-23/1051692985(1), DATED 30.03.2023 (ANNEXURE-E) AS WELL AS NOTICE OF DEMAND DATED 30.03.2023 ISSUED UNDER SECTION 156 OF THE ACT IN DIN AND NOTICE NO. ITBA/AST/S/156/2022-23/1051692890(1) DATED

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30.03.2023 (ANNEXURE-F) PASSED BY THE 1ST RESPONDENT AS WELL AS IMPUGNED PENALTY ORDER PASSED UNDER SECTION 272A(1)(d) AND 270A OF THE ACT, IN DIN AND NOTICE NO. ITBA/PNL/F/272A(1)(d)/2023-24/1055532780(1) AND ITBA/PNL/F/270A/2023-24/1056490105(1) DATED 28.08.2023 AND 25.09.2023 (ANNEXURE-G) AND (ANNEXURE-H) PASSED BY THE 2ND RESPONDENT FOR THE ASSESSMENT YEAR 201819.DIRECTION UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PROHIBITING AND RESTRAINING THE RESPONDENTS BY THEMSELVES, THEIR SUBORDINATE, SERVANTS AND AGENTS FROM TAKING ANY ACTION IN FURTHERANCE OR CONSEQUENT TO IMPUGNED ATTACHMENT NOTICES ISSUED UNDER SECTION 226(3) OF THE ACT TO THE 3RD TO 5TH RESPONDENT BANKS IN DIN AND NOTICE NO. ITBA/RCV/S/226(3)-1/2024-25/1074167915(1) (ANNEXURE-J), DIN AND NOTICE NO. ITBA/RCV/S/226(3)-1/2024-25/1074168030(1) (ANNEXURE-J1), DIN AND NOTICE NO. ITBA/ RCV/ S/226(3)-1/2024-25/1074261712(1) (ANNEXUREJ2) AND DIN AND NOTICE NO. ITBA/RCV/S/226(3)1/2024-25/1074262052(1) (ANNEXUREJ3).DIRECTION UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA CALLING FOR THE RECORDS OF THE PETITIONERS CASE AND AFTER EXAMINING THE LEGALITY AND VALIDITY THEREOF BE PLEASED TO QUASH AND SET ASIDE THE IMPUGNED ATTACHMENT NOTICES ISSUED UNDER SECTION 226(3) OF THE ACT TO THE 3RD TO 5TH RESPONDENT BANKS IN DIN AND NOTICE NO. ITBA/RCV/S/226(3)-1/2024-25/1074167915(1)

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(ANNEXURE-J), DIN AND NOTICE NO. ITBA/RCV/S/226(3)-1/2024-25/1074168030(1) (ANNEXURE-J1), DIN AND NOTICE NO. ITBA/RCV/S/226(3)-1/2024-25/1074261712(1) (ANNEXURE-J2) AND DIN AND NOTICE NO. ITBA/ RCV/S/226(3)-1/2024-25/1074262052(1) (ANNEXURE-J3) FOR ASSESSMENT YEARS 2017-18, 2018-19, 2019-20 AND 2020-21.

THESE PETITIONS, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE B M SHYAM PRASAD

ORAL ORDER

The petitioner has called in question the Assessment Orders and the preceding Orders under Section 148A(d) of the Income Tax Act, 1961 [for short, ' the IT Act '] while also calling in question the Notices under Section 226(3) thereof. The impugned orders are for the Assessment Years 2018-19 and 2020-21. The details of the relevant impugned Order/Notices are as follows:

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IN W.P.No.13055/2025

[a] Order dated 17.03.2024 under Section 148A(d) of the Act [Annexure - B].

[b] Notice dated 19.03.2024 under Section 148 of the Act [Annexure - C].

[c] Intimation Letter dated 09.07.2024 under Section 144B of the Act [Annexure - D].

[d] Order dated 02.01.2025 under Section 147 r/w Section 144 r/w Section 144B of the IT Act [Annexure - L].

[e] Demand Notice dated 02.01.2025 under Section 156 of the Act [Annexure - L1].

[f] Notice dated 10.03.2025 under Section 226(3) of the Act [ Annexure - M ].

IN W.P.No.15078/2025

[a] Order dated 31.03.2022 under Section 148A(d) of the Act [Annexure - A].

[[b] Notice dated 31.03.2022 under Section 148 of the Act [Annexure - B].

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[c] Assessment Order dated 30.03.2023 under Section 147 of the Act.

[d] The Computation Sheet dated 30.03.2023 [ Annexure - E ].

[e] Demand Notice dated 30.03.2023 under Section 156 of the Act [ Annexure - F ].

[f] Penalty Order dated 28.08.2023 under Section 272A(1)(d) of the IT Act [ Annexure - G ].

[g] Order dated 25.09.2023 under Section 270A of the IT Act [ Annexure - H ].

[h] Attachment Notices dated 07.03.2025 and 10.03.2025 under Section 226(3) of the IT Act [ Annexures - J, J1, J2 and J3 ]

The petitioner had also called in question

similar orders/notices in W.P. No.10973/2025 for the Assessment Year 2017-18, and this Court has disposed of this petition by the order dated 25.04.2025 opining that Notice under Section 142(1)

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of the IT Act has not been served on the petitioner, and that the petitioner should have another opportunity. This Court's order in the afore petition reads as under:

"3. The grievance of the Petitioner is that the notice under Section 142(1) of the Income Tax Act, 1961 was not served on the petitioner and as such, the Petitioner could not reply to the same resulting in the assessment order having been passed vide Annexure-M. There is nothing placed on record that the Petitioner has been served with a notice.

4. In that view of the matter, in the interest of justice I'm of the considered opinion that the petitioner should be provided an opportunity to reply to 142(1) notice which could be considered by the respondent."

This Court, in the light of this opinion, and the reasons assigned by the petitioner in the present matters to assert that it was not served with notices under 148A of the IT Act, is of the considered view that the petitions must be allowed-in-part quashing the assessment orders and attachment orders, but on

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the condition that the petitioner shall not be entitled to raise the ground of limitation. At this stage, it is pointed out that the petitioner has also raised the question of jurisdiction, and it would suffice for this Court to observe that no opinion is rendered on such ground and all aspects must be considered afresh. In the light of the afore, the following:

ORDER

a. The petitions are allowed-in-part.

b. The impugned Assessment Orders, Notices and the Attachment orders under Sections 148A(d), 144 read with Section 144B of the IT Act and also the Notices under Section 226(3) of the IT Act in W.P.No.13055/2025 [ Annexures - B, C, D L, L1 and M ] and in W.P.No.15078/2025 [ Annexures - A, B, D,

E, F, G, H and J Series ] are quashed.

c. The petitioner is reserved with liberty to file

a response to the Notices under Section

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148A(b) of the IT Act by 30.06.2025 with liberty to the respondents to consider the same and pass such orders and subject to

this Court's observations as aforesaid.

SD/(B M SHYAM PRASAD) JUDGE

RB