- 1 - HC-KAR NC: 2025:KHC:43311 WP No. 8795 of 2022 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 29TH DAY OF OCTOBER, 2025 BEFORE THE HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR WRIT PETITION NO. 8795 OF 2022 (T-IT) BETWEEN: M/S. ARJUN SOUHARDHA PATHINA SAHAKARI NIYAMITHA, A CO-OPERATIVE SOCIETY REGISTERED UNDER THE KARNATAKA SOUHARDHA SAHAKARI ACT 1997, REP. BY ITS PRESIDENT, SRI V R SHEKAR, S/O SRI V RAMAMURTHY, AGED ABOUT 51 YEARS, NO.88, 1ST FLOOR, JEERIGE BUILDING, 11TH CROSS, MALLESHWARAM, BANGALORE -560 003. …PETITIONER (BY SRI S SHANKAR, SENIOR ADVOCATE FOR SRI ANNAMALAI.S & SRI M LAVA, ADVOCATES) AND: 1. THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1(3), CENTRAL REVENUE BUILDING, QUEENS ROAD, BENGALURU -560 001. 2. NATIONAL FACELESS ASSESSMENT CENTRE, REP. BY ADDL/JOINT/DEPUTY /ASSISTANT COMMISSIONER OF INCOME TAX/ INCOME TAX OFFICER, INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, ROOM NO.401, 2ND FLOOR, E-RAMP, JAWARLAL NEHRU STADIUM, DELHI-110 003. 3. THE INCOME TAX OFFICER, WARD -2 (2) (3), Digitally signed by NANDINI R Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:43311 WP No. 8795 of 2022 BMTC BUILDING, 80 FEET ROAD, 6TH BLOCK, NEAR KHB GAMES VILLAGE, KORAMANGALA, BANGALORE -560 095. …RESPONDENTS (BY SRI RAVI RAJ Y V & SRI M DILIP, ADVOCATES FOR R-1 TO 3) THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ASSESSMENT ORDER DATED 28.03.2022 PASSED UNDER SECTION 147 OF THE INCOME TAX ACT,1961 (HEREINAFTER REFERRED TO AS "THE ACT") FOR THE ASSESSMENT YEAR 2017-18 BY THE R-1 BEARING DIN AND ORDER NO. ITBA/AST/M/147/2021-22/1041843945(1) HEREIN MARKED AS ANNEXURE-A1 ETC. THIS PETITION, COMING ON FOR PRELIMINARY HEARING IN B GROUP, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE S.R.KRISHNA KUMAR ORAL ORDER 1. In this petition, petitioner seeks the following reliefs: "Wherefore it is prayed that this Hon'ble Court be pleased to: (i) Issue a Writ of Certiorari or direction in the nature of writ of certiorari quashing the assessment order dated 28.03.2022 passed under section 147 of the Income Tax Act, 1961 (hereinafter referred to as " the Act") for the assessment year 2017-18 by the Respondent No.1 bearing DIN and order No. ITBA/AST/M/147/2021-22/1041843945(1) herein marked as Annexure A1. (ii) Issue a Writ of Certiorari or direction in the nature of writ of certiorari quashing the computation sheet dated 28.03.2022 issued by the Respondent No.1 for the assessment year 2017- 18 bearing DIN and document No. ITBA/AST/M/147/2021- 22/1041843947(1) which is enclosed as Annexure-A2. - 3 - HC-KAR NC: 2025:KHC:43311 WP No. 8795 of 2022 (iii) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the notice of demand issued under section 156 of the Act dated 28.03.2022 issued by the Respondent No.1 for the assessment year 2017-18 bearing Notice No. ITBA/AST/M/147/2021-22/1041843946(1) herein marked as Annexure - АЗ. (iv) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the penalty notice dated 31.03.2022 issued under section 274 r.w.s 270A of the Act issued by the Respondent No.1 for the assessment year 2017-18 bearing DIN & Notice No. ITBA/PNL/S/270A/2021-22/1042289514(1) herein marked as Annexure - A4. (v) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the penalty notice dated 31.03.2022 issued under section 274 r.w.s 271F of the Act issued by the Respondent No.1 for the assessment year 2017-18 bearing DIN & Notice No. ITBA/PNL/S/271F/2021-22/1042289807(1) herein marked as Annexure - A5. (vi) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the penalty notice dated 31.03.2022 Issued under section 274 r.w.s 271AAC(1) of the Act Issued by the Respondent No.1 for the assessment year 2017-18 bearing DIN & Notice No. ITBA/PNL/S/271AAC(1)/ 2021- 22/1042289072(1) herein marked as Annexure - А6. (vii) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the notice dated 29.03.2021 issued under section 148 of the Income Tax Act, 1961 (hereinafter referred to as "the Act") for the assessment year 2017-18 by the Respondent No.3 bearing DIN & Notice No. - 4 - HC-KAR NC: 2025:KHC:43311 WP No. 8795 of 2022 ITBA/AST/S/148/2020-21/1031865374(1) herein marked as Annexure-B. (viii) 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, learned counsel for respondents 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, the learned Senior counsel for the petitioner submits that the impugned assessment order and consequent notices are illegal, arbitrary and vitiated for the following grounds: "a) The notice issued under section 148 of the Act is bad in law as the notice has several material defects and is issued without complying with the mandatory conditions for issue of the notice. b) The provisions of section 147, 148, 149 and 151 before substitution by the Finance Act, 2021 do not exit after 01.04.2021 to pass the assessment order under the old provision and consequently the assessment order passed is bad in law on the facts and circumstances of the case. c) The petitioner submits that mandatory conditions as contemplated in the provisions of section 147 of the Act have not been complied with and consequently the assessment - 5 - HC-KAR NC: 2025:KHC:43311 WP No. 8795 of 2022 order passed under section 147 r.w.s 144 of the Act is bad in law. d) The assessment proceedings and notices issued in the PAN AAOFA1714B and the assessment order passed in the PAN AAOFA1714B are bad in law. e) The assessment order passed under section 147 r.w.s 144 of the Act is in violation of the principles of natural justice as the notices issued have not been served on the petitioner and the petitioner has not been provided with the basis on which the additions are made in the assessment order. f) The addition of Rs. 25,78,64,480/- made under section 69C of the Act is unsustainable in law when the provisions of section 69C of the Act are not applicable. g) The addition of Rs. 5,14,04,613/- made under section 68 of the Act is unsustainable in law as per the provisions of section 68 of the Act are invoked without jurisdiction and further when the source for the cash deposits in the bank accounts have been explained by way of cash withdrawals from various bank accounts. h) The addition of Rs. 46,50,000/- the addition of Rs. 46,50,000/- being the alleged time deposits is without any basis and unsustainable in law." He, therefore, submitted that the impugned order deserves to be set aside and the matter may be remitted back to the 1st respondent for reconsideration afresh, in accordance with law. - 6 - HC-KAR NC: 2025:KHC:43311 WP No. 8795 of 2022 4. Per contra, learned counsel for the respondents submits that there is no merit in the petition and the same is liable to be dismissed. 5. As rightly contended by the learned Senior counsel for the petitioner, the afore said grounds and contentions urged by the petitioner have not been considered by the 1st respondent while passing the impugned orders, which deserve to be set aside and matter has to be remitted back to the respondents, for reconsideration afresh in accordance with law. ] 6. In the result, I pass the following:- ORDER (i) The petition is hereby allowed. (ii) The impugned Assessment orders at Annexure-A1 dated 28.3.2022; Annexure-A2 dated 28.03.2022; Annexure-A3 dated 28.03.2022; Annexure-A4 dated 31.03.2022; Annexure-A2 dated 31.03.2022; Annexure-A6 dated 31.03.2022 passed by the 1st respondent are hereby set aside. (iii) The matter is remitted back to the 1st respondent for reconsideration afresh to the stage of the petitioner - 7 - HC-KAR NC: 2025:KHC:43311 WP No. 8795 of 2022 submitting reply to the notice u/s 148 dated 29.03.2021 and proceed further in accordance with law. (iv) Liberty is reserved in favour of the petitioner to submit his response/reply/pleadings along with the documents to the respondent and which shall be considered by the 1st respondent, who shall provide sufficient and reasonable opportunity to the petitioner and proceed further in accordance with law. (v) All the rival contentions in all aspects of the matter are kept open and no opinion are expressed on the same. Sd/- (S.R.KRISHNA KUMAR) JUDGE tsn* List No.: 1 Sl No.: 40