- 1 - HC-KAR NC: 2025:KHC:54473 WP No. 37835 of 2025 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 15TH DAY OF DECEMBER, 2025 BEFORE THE HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO. 37835 OF 2025 (T-IT) BETWEEN: MR M MUNISWAMY REDDY SON OF LATE MUNIAPPA REDDY AGED ABOUT 65 YEARS, RESIDING AT NO. 93/A, VAJESHWARI NILAYA, 13TH CROSS, HENNUR MAIN ROAD, KACHARAKANAHALLI, BENGALURU – 560 084 …PETITIONER (BY SRI. VIKRAM HUILGOL, SENIOR COUNSEL FOR SRI. ALOKE MADAPPA, ADVOCATE) AND: 1. INCOME TAX OFFICER WARD 1(2)(4), BANGALORE BMTC BUILDING, 80 FEET ROAD, 6TH BLOCK, NEAR KHB GAMES VILLAGE, KORAMANGALA, BENGALURU – 560 095. 2. ASSESSMENT UNIT REPRESENTED BY ADDITIONAL / JOINT / DEPUTY / ASSISTANT COMMISSIONER OF INCOME TAX/ INCOME TAX OFFICER, INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, ROOM NO. 401, 2ND FLOOR, E-RAMP, JAWARHARLAL NEHRU STADIUM, DELHI – 110 003. 3. NATIONAL FACELESS ASSESSMENT CENTRE REPRESENTED BY ADDITIONAL / JOINT / DEPUTY / ASSISTANT COMMISSIONER OF INCOME TAX/ INCOME TAX OFFICER, INCOME TAX DEPARTMENT, Digitally signed by CHANDANA B M Location: High Court of Karnataka - 2 - HC-KAR NC: 2025:KHC:54473 WP No. 37835 of 2025 MINISTRY OF FINANCE, ROOM NO. 401, 2ND FLOOR, E-RAMP, JAWARHARLAL NEHRU STADIUM, DELHI – 110 003 …RESPONDENTS (BY SRI. Y. V. RAVIRAJ, ADVOCATE) THIS W.P. IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO QUASHING (I) ASSESSMENT ORDER DATED 05.12.2025 BEARING NO. ITBA/AST/S/144/2025-26/1083393449(1) PASSED BY THE 2ND RESPONDENT, ALONG WITH COMPUTATION SHEET DATED 05.12.2025 BEARING NO. ITBA/AST/S/88/2025- 26/1083405419(1), AND NOTICE OF DEMAND DATED 05.12.2025 BEARING NO. ITBA/AST/S/156/2025- 26/1083404641(1), ALL ISSUED BY THE 2ND RESPONDENT (ANNEXURE A, A1 AND A2) AND ETC., THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR ORAL ORDER In this petition, the petitioner seeks the following reliefs: “ i) Issue a Writ or Order in the nature of Certiorari, quashing ITBA/AST/S/144/2025-26/1083393449(1) passed by the 2nd Respondent, along with Computation Sheet dated 05.12.2025 bearing No.ITBA/AST/S/88/2025- - 3 - HC-KAR NC: 2025:KHC:54473 WP No. 37835 of 2025 26/1083405419(1), and Notice of Demand dated 05.12.2025 bearing No.ITBA/AST/S/`156/2025- 26/1083404641(1), all issued by the 2nd Respondent (Annexure-A, A1 and A2). ii) Issue a Writ or Order in the nature of CERTIORARI, quashing (i) Notice for Penalty under Section 271F dated 05.12.2025 bearing No.ITBA/PNL/S/271F/2025- 26/1083413856(1), and (ii)Notice for Penalty under Section 271AAC(1) dated 05.12.2025 bearing No.ITBA/PNL/S/271AAc(1)/2025-26/1083413680(1), issued by the 2nd Respondent (Annexure-B and B1). iii) Pass such other or further order as this Hon’ble Court may deem fit in the facts and circumstances of the case, and in the interests of justice and equity.” 2. Heard learned Senior counsel appearing on behalf of the learned counsel for the petitioner and learned counsel for the respondent and perused the material on record. 3. In addition to reiterating the various contentions urged in the petition and referring to the material on record, learned Senior counsel for the petitioner invited my attention to the impugned order at Annexure-A1 dated 05.12.2025 in order to point out that in his replies to the notices issued by the respondents, in particular, the detailed reply dated 27.11.2025, the petitioner had - 4 - HC-KAR NC: 2025:KHC:54473 WP No. 37835 of 2025 specifically contended that out of the total alleged unaccounted sum of Rs.32,00,500/-, in that the petitioner has received a sum of Rs.26,50,000/- towards sale of an immovable property vide registered Sale Agreement dated 11.12.2014 and the balance sum of Rs.4,50,000/- was received by him from his son by way of gift in the year 2014 and both the said transactions were reflected and shown in the petitioner’s income tax returns for the year 2016-17 as well as the income tax returns filed by the petitioner’s son for the very same year 2016-17. It is submitted that despite the specific detailed reply and the contentions urged by the petitioner and documents produced in support of their claim, it is alleged that the entire sum of Rs.32,00,500/- is treated as unexplained money and the respondents have committed an error in rejecting the evidence while passing the impugned order, which is contrary to the material on record. 4. 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. 5. A perusal of the impugned order will indicate that the following specific contentions urged by the petitioner have been - 5 - HC-KAR NC: 2025:KHC:54473 WP No. 37835 of 2025 taken note of by the respondents in the impugned order at Annexure-A that out of a sum of Rs.32,00,500/- i.e., a sum of Rs.26,50,000/- (cash) towards Sale Agreement dated 11.12.2014 was received by the petitioner and Rs.4,50,000/- (cash) was received by the petitioner from his son. 6. However, though the petitioner had produced relevant documents to indicate that the sale agreement and cash received from the son of the petitioner, all of which cumulatively establish that the petitioner had received the entire sum of Rs.32,50,000/-, the respondents have clearly fell in error in rejecting the documents and contentions of the petitioner and proceeded to pass the impugned order based on surmises and conjunctures, which is contrary to the material on record, warranting interference by this Court in the present petition. 7. In the result, I pass the following: ORDER (i) The petition is allowed. (ii) The impugned Assessment order, computation sheet, demand notice, all dated 05.12.2025 at Annexures-A, A1 and A2, respectively, and the - 6 - HC-KAR NC: 2025:KHC:54473 WP No. 37835 of 2025 impugned penalty notices, both dated 05.12.2025 at Annexures-B and B1, respectively, are hereby quashed. Sd/- (S.R.KRISHNA KUMAR) JUDGE BMC List No.: 2 Sl No.: 21