Allowed¶55

Yashaswini Gruha Nirmana Sahakara Sangha Niyamitha v. the Income Tax Officer

Karnataka HC16 Oct 2025WP/24909/2025

Case brief

AI extract

What is this about?

TDS proceedings under Sections 201(1)/201(1A) IT Act and Section 271C penalty for AY 2015-16 against a Mysore co-operative housing society set aside; notices dated 07.07.2021 to 24.01.2022 claimed not received; fresh opportunity granted; matter remitted to ITO TDS Ward-1, Mysore for reconsideration afresh from the reply stage; Karnataka HC, S.R. Krishna Kumar J., 16.10.2025; WP No. 24909 of 2025 (T-IT); certiorari under Articles 226/227.

What did the court decide?

Impugned order dated 22.03.2022 (Annexure-A, Sections 201(1) and 201(1A)) and penalty order dated 03.02.2023 (Annexure-A1, Section 271C) set aside; matter remitted to respondent No.2 for reconsideration afresh from the stage of submitting reply to the notices at Annexures D–D4; liberty to petitioner to submit additional pleadings/documents. ¶55

Yashaswini Gruha Nirmana Sahakara Sangha Niyamitha Vs the… — Income Tax | Karnataka HC (2025)

What the court decided

AI extract

Outcome

¶55

Issue for consideration

Whether the petitioner — which asserts it never received the notices/letters dated 07.07.2021, 14.09.2021, 29.10.2021, 27.12.2021 and 24.01.2022 issued under Sections 201(1) and 201(1A) of the IT Act — should be granted one more opportunity to submit its reply and documents. +1 more

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Court's answer

Accepting the petitioner's assertion that its inability and omission to submit a reply along with documents to the notices under Sections 201(1) and 201(1A) was due to bonafide reasons, unavoidable circumstances and sufficient cause, the Court granted one more opportunity to submit the reply.

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Ratio / Principle

The Court deemed it just and appropriate to set aside the impugned order at Annexure-A dated 22.03.2022 passed under Sections 201(1) and 201(1A) of the Income Tax Act, the penalty order at Annexure-A1 dated 03.02.2023 passed under Section 271C, and subsequent notices/orders.

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Key takeaways

The matter stands remitted to respondent No.2 for reconsideration afresh in accordance with law from the stage of submitting reply to the notices at Annexures D to D4 dated 07.07.2021, 14.09.2021, 29.10.2021, 27.12.2021 and 24.01.2022.ratio¶57
Liberty is reserved to the petitioner to submit additional pleadings and documents to the respondent, who shall consider the same and proceed further in accordance with law.ratio¶58

Detailed headnote1 paragraphs

Karnataka HC (S.R. Krishna Kumar, J.), W.P. No. 24909 of 2025 (T-IT), decided 16.10.2025: allowed. Yashaswini Gruha Nirmana Sahakara Sangha Niyamitha (co-operative society; AY 2015-16) challenged (i) the order dated 22.03.2022 (DIN ITBA/COM/F/17/202122/1041239893(1)) passed by respondent No.2 (ITO, TDS Ward-1, Mysore) under Sections 201(1) and 201(1A) of the Income Tax Act, 1961 (Annexure-A) and (ii) the penalty order dated 03.02.2023 (DIN KAR/181/03022023/00306) passed by respondent No.3 (Addl. Commissioner of Income Tax (TDS) Range-1) under Section 271C (Annexure-A1). The petitioner pleaded non-receipt of the notices/letters dated 07.07.2021, 14.09.2021, 29.10.2021, 27.12.2021 and 24.01.2022 (Annexures D–D4) and consequent inability to submit a reply. Finding the omission attributable to bonafide reasons, unavoidable circumstances and sufficient cause, the Court set aside both orders and subsequent notices/orders and remitted the matter to respondent No.2 for reconsideration afresh from the stage of submitting reply to those notices, reserving liberty to the petitioner to file additional pleadings and documents.

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NC: 2025:KHC:41790 WP No. 24909 of 2025

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HC-KAR

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 16^TH DAY OF OCTOBER, 2025

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BEFORE

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THE HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR

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WRIT PETITION NO. 24909 OF 2025 (T-IT)

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BETWEEN:

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YASHASWINI GRUHA NIRMANA SAHAKARA SANGHA NIYAMITHA REGISTERED U/S 8 OF THE CO-OPERATIVE SOCIETIES ACT, 1959, NO.43, H D DEVEGOWDA CIRCLE, BANNUR ROAD, 1^ST CROSS, NEAR RING ROAD, MYSORE – 570 012 TAN: BLRY00904B REPRESENTED BY ITS CEO, SRIKANTH M., AGED 60 YEARS, S/O MADAPPA NANJAIAH, NO.2675, 4^TH CROSS, KALIDASA ROAD, V V MOHALLA, MYSORE – 570 010

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…PETITIONER

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

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(BY SRI. RAVI SHANKAR S. V., ADVOCATE)

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AND:

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THE INCOME TAX OFFICER TDS, WARD - 2(4), MYSORE – 570 010.

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THE INCOME TAX OFFICER, TDS, WARD - 1, MYSORE – 570 008.

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THE ADDITIONAL COMMISSIONER OF INCOME TAX (TDS) RANGE-1,

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THE OFFICE OF ADDITIONAL COMMISSIONER OF INCOME TAX (TDS) RANGE 1, 4^TH FLOOR, HMT BHAVAN, NO.59, BELLARY ROAD,

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NC: 2025:KHC:41790 WP No. 24909 of 2025

HC-KAR

BANGALORE – 560 032.

…RESPONDENTS

(BY SRI. ARAVIND V. CHAVAN, ADVOCATE)

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THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO ISSUE A WRIT OF CERTIORARI OR DIRECTION IN THE NATURE OF A WRIT OF CERTIORARI QUASHING THE ORDER PASSED U/S 201(1) AND 201(1A) DATED 22/03/2022 BEARING DIN ITBA/COM/F/17/202122/1041239893(1) PASSED BY THE RESPONDENT NO.2 FOR THE ASSESSMENT YEAR 2015-16 HEREIN MARKED AS ANNEXURE-A AND ETC.,

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

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

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ORAL ORDER

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

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“i) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the order passed U/s 201(1) & 201(1A) dated 22/03/2022 bearing DIN: ITBA/COM/F/17/2021-22/1041239893(1) passed by the Respondent No.2 for the assessment year 201516 herein marked as Annexure - A.

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ii) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the penalty order dated 03/02/2023 passed u/s 271C of the Act Vide DIN KAR/181/03022023/00306 by the Respondent No.3 for the assessment year 2015-16 herein marked as Annexure - A1.

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NC: 2025:KHC:41790 WP No. 24909 of 2025

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HC-KAR

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iii) Issue a writ of Mandamus or direction in the nature of a writ of mandamus, directing the respondent No.1 to summon the recipients in Annexure L, and secure the manner of treatment of the advances in the books of the recipients, in so for as petitioner consent.

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

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Heard learned counsel for the petitioner and learned

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counsel for the respondents and perused the material on record.

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In addition to reiterating the various contentions urged in the memorandum of petition and referring to the material on record, learned counsel for the petitioner submits that notice dated 07.07.2021 and subsequent letters dated 14.09.2021, 29.10.2021, 27.12.2021 and 24.01.2022 issued by the respondent No.2 under Sections 201(1) and 201(1A) of the Income Tax Act, 1961 (for short, ‘IT Act’), was not received by petitioner and he was not aware of the notice and consequently, petitioner could not submit its reply / response along with documents to the said notice. It is submitted that the inability and omission on the part of the petitioner to submit reply / response along with documents to the notice under Sections 201(1) and 201(1A) of the Act was due to

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4 - NC: 2025:KHC:41790 WP No. 24909 of 2025

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HC-KAR

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bonafide reasons, unavoidable circumstances and sufficient cause and as such, if one more opportunity is provided to the petitioner to do so by setting aside the impugned orders and notices, the petitioner would do so and respondents may be directed to proceed further in accordance with law.

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Per contra, learned counsel for the respondents submits that there is no merit in the petition and that the same is liable to be dismissed.

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A perusal of the impugned order will indicate that it is an undisputed fact that petitioner has not submitted reply / response along with documents to notice under Section 201(1) and 201(1A) as can be seen from the paragraph No.5 of the impugned order dated 22.03.2022, which reads as under:

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“5. Further, in response to this office letters cited above, the Deputy Registrar has neither submitted reply nor substantiated the details of TDS effected in the case of Yashaswini Gruha Nirmana Sahakara Sanga Niyamintha for the year under consideration (period 01.04.2014 to 31.03.2015). The chief executive officer has submitted the details of payment of TDS for the Financial year 2014-15 amounting to Rs.8,10,500/-. The details were verified with

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NC: 2025:KHC:41790 WP No. 24909 of 2025

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HC-KAR

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respect to available records and the data available in the system for the year under consideration.”

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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 to notice under Sections 201(1) and 201(1A) was due to bonafide reasons, unavoidable circumstances and sufficient cause and if one more opportunity is granted, petitioner would submit reply along with documents, I deem it just and appropriate to set aside the impugned order at Annexure – A dated 22.03.2022 passed under Sections 201(1) and 201(1A) of the Income Tax Act, the penalty order at Annexure-A1 dated 03.02.2023 passed under Section 271C of the Income Tax Act and subsequent notice / orders, etc., and remit the matter back to respondent No.2 for reconsideration afresh from the stage of submitting of reply by the petitioner to notice under Sections 201(1) and 201(1A) of the Income Tax Act and to proceed further in accordance with law.

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In the result, pass the following:

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6 - NC: 2025:KHC:41790 WP No. 24909 of 2025

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HC-KAR

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ORDER

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(i) The petition is hereby allowed .

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(ii) The impugned order at Annexure – A dated 22.03.2022 passed by respondent No.2 and the impugned penalty order at Annexure- A1 dated 03.02.2023 are hereby set aside.

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(iii) The matter is remitted back to respondent

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No.2 for reconsideration afresh in accordance with law from the stage of submitting of reply to the Notices under Sections 201(1) and 201(1A) of the IT Act at Annexures – D to D4 dated 07.07.2021, 14.09.2021, 29.10.2021, 27.12.2021 and 24.01.2022.

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(iv) Liberty is reserved in favour of the petitioner to submit additional pleadings, documents, etc., to the respondent, who shall consider the same and proceed further in accordance with law.

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Sd/(S.R.KRISHNA KUMAR) JUDGE

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List No.: 2 Sl No.: 30

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MDS

Yashaswini Gruha Nirmana Sahakara Sangha Niyamitha v. the Income Tax Officer

Case brief

What is this about?

What did the court decide?

Yashaswini Gruha Nirmana Sahakara Sangha Niyamitha v. the Income Tax Officer

Case brief

What is this about?

What did the court decide?

Why is it important?

What the court decided

Issues for consideration

Statutes considered

Procedural history

Parties & counsel

Coram

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