- 1 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 10TH DAY OF JUNE, 2026 BEFORE THE HON'BLE MR. JUSTICE B M SHYAM PRASAD WRIT PETITION NO. 5075 OF 2017 (T-IT) C/W WRIT PETITION NO. 7845 OF 2017 (T-IT) WRIT PETITION NO. 7857 OF 2017 (T-IT) WRIT PETITION NO. 37133 OF 2017 (T-IT) IN WP No. 5075/2017 BETWEEN: RNS INFRASTRUCTURE LIMITED NO.14 7TH FLOOR NAVEEN COMPLEX M G ROAD BENGALURU-560 001 REPRESENTED BY ITS MANAGING DIRECTOR SRI NAVEEN R SHETTY AGED ABOUT 47 YEARS …PETITIONER (BY SRI. A. SHANKAR, SENIOR ADVOCATE FOR SRI. M LAVA., ADVOCATE) AND: Digitally signed by VANAMALA N Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER 1. THE DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 2 (3) CENTRAL REVENUES BUILDING QUEENS ROAD BENGALURU-560 001 2. THE COMMISSIONER OF INCOME TAX (CENTRAL) CENTRAL REVENUES BUILDING QUEENS ROAD BENGALURU-560 001 …RESPONDENTS (BY SRI. Y. V. RAVIRAJ A/W SRI. M. DILIP, ADVOCATE) THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO-QUASH THE SHOW-CAUSE NOTICES ALL DTD. 25.1.2017 (ANNX-A1 TO A7) ISSUED BY THE R-1, AS THE PROCEEDINGS ARE BARRED BY LIMITATION AND THUS WITHOUT JURISDICTION.DECLARE THAT THE R-1 IS NOT ENTITLED IN LAW TO PASS ORDERS OF ASSESSMENT FOR THE ASSESSMENT YEARS 2006- 07 TO 2012-13 AS THEY ARE BARRED BY LIMITATION AND HENCE PER SE WITHOUT JURISDICTION. IN WP NO. 7845/2017 BETWEEN: - 3 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER RNS INFRASTRUCTURE LIMITED NO.14, 7TH FLOOR, NAVEEN COMPLEX, M.G. ROAD, BENGALURU-560 001, REPRESENTED BY ITS MANAGING DIRECTOR, SRI. NAVEEN R. SHETTY, AGED ABOUT 47 YEARS, ...PETITIONER (BY SRI. A. SHANKAR, SENIOR ADVOCATE FOR SRI. M LAVA., ADVOCATE) AND: 1. THE DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 2(3), CENTRAL REVENUES BUILDING, QUEENS ROAD, BENGALURU-560 001. 2. THE COMMISSIONER OF INCOME TAX (CENTRAL) CENTRAL REVENUES BUILDING, QUEENS ROAD, BENGALURU-560 001. 3. THE JOINT COMMISSIONER OF INCOME TAX CENTRAL RANGE-2, CENTRAL REVENUES BUILDING, QUEENS ROAD, BENGALURU-560 001. ...RESPONDENTS (BY SRI. RAVI RAJ Y V., A/W SRI. M. DILIP, ADVOCATES) THIS W.P IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO - 4 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER QUASH THE ASSESSEMNT ORDER DTD3.2.2017 FOR THE ASSESSMENT YEARS 2006-07 TO 2011-12 [ANNEXURE-A1 TO A6] PASSED BY THE R-1 U/S 144 r.w.s 153A OF THE INCOME TAX ACT 1961 AS BARRED BY LIMIATATION AND THUS PER SE WITHOUT JURISDICTION. IN WP NO. 7857/2017 BETWEEN: RNS INFRASTRUCTURE LIMITED NO.14, 7TH FLOOR, NAVEEN COMPLEX, M.G. ROAD, BENGALURU-560 001, REPRESENTED BY ITS MANAGING DIRECTOR, SRI. NAVEEN R. SHETTY, AGED ABOUT 47 YEARS, ...PETITIONER (BY SRI. A. SHANKAR, SENIOR ADVOCATE FOR SRI. M LAVA., ADVOCATE) AND: 1. THE DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 2(3), CENTRAL REVENUES BUILDING, QUEENS ROAD, BENGALURU-560 001. 2. THE COMMISSIONER OF INCOME TAX (CENTRAL) CENTRAL REVENUES BUILDING, QUEENS ROAD, - 5 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER BENGALURU-560 001. 3. THE JOINT COMMISSIONER OF INCOME TAX CENTRAL RANGE-2, CENTRAL REVENUES BUILDING, QUEENS ROAD, BENGALURU-560 001. ...RESPONDENTS (BY SRI. RAVI RAJ Y V., A/W SRI. M. DILIP, ADVOCATES) THIS W.P IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ASSESSEMNT ORDER DTD3.2.2017 FOR THE ASSESSMENT YEARS 2011-12 [ANNEXURE-A] PASSED BY THE R-1 U/S 144 OF THE INCOME TAX ACT 1961 AS BARRED BY LIMITATION AND THUS PER SE WITHOUT JURISDICTION. IN WP NO. 37133/2017 BETWEEN: RNS INFRASTRUCTUTE LIMITED NO.14, 7TH FLOOR, NAVEEN COMPLEX, M.G. ROAD, BENGALURU-560001. REPRESENTED BY ITS MANAGING DIRECTOR, SRI NAVEEN R. SHETTY, AGED ABOUT 48 YEARS. ...PETITIONER (BY SRI. A. SHANKAR, SENIOR ADVOCATE FOR - 6 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER SRI. M LAVA., ADVOCATE) AND: 1. THE DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 2(3), CENTRAL REVENUE BUILDING, QUEENS ROAD, BENGALURU-560001. 2. THE COMMISSIONER OF INCOME TAX (CENTRAL) CENTRAL REVENUE BUILDING, QUEENS ROAD, BENGALURU-560001. 3. THE JOINT COMMISSIONER OF INCOME TAX CENTRAL RANGE-2, CENTRAL REVENUE BUILDING, QUEENS ROAD, BENGALURU-560001. ...RESPONDENTS (BY SRI. Y. V. RAVIRAJ A/W SRI. M. DILIP, ADVOCATES) THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE NOTICES ISSUED UNDER THE PROVISIONS OF SECTION 274 R.W.S.271[1] [C] OF THE ACT DTD3.2.2017 FOR THE YEARS 2006-07 TO 2011-12 OF THE ACT ISSUED BY THE R-1 AND REFERRED AS ANNEXURE-A1 TO A6 AND NOTICE ISSUED UNDER SECTION 274 R.W.S. 271AAA OF - 7 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER THE ACT DTD3.2.2017 AS REFFERED AS ANNEXURE-A7 AS ILEGAL AND INVALID ISSUED BY THE R-1GRANT AN AD-INTERIM ORDER STAY THE OPERATION OF THE NOTICES ISSUED UNDER UNDER THE PROVISIONS OF SECTION 274 R.W.S.271[1] [C] OF THE ACT DTD3.2.2017 FOR THE YEARS 2006-07 TO 2011-12 OF THE ACT ISSUED BY THE R-1 AND REFERRED AS ANNEXURE-A1 TO A6 AND NOTICE ISSUED UNDER SECTION 274 R.W.S. 271AAA OF THE ACT DTD3.2.2017 AS REFFERED AS ANNEXURE-A7. 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 In these batch of writ petitions, the petitioner has called in question Show Cause Notices issued for the years 2006-07 to 2012-13, the Assessment Orders relevant to these years as also the penalty - 8 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER notices. The details of the corresponding writ petitions and the Orders/Notices challenged in these petitions are as follows. W.P.Nos. Particulars W.P.No.5075/2017 Show Cause Notices for the Assessment Years 2006-07 to 2012-13 W.P.No.7845/2014 Assessment Order dated 03.02.2017 for the Assessment Years 2006-07 to 2011-12 W.P.No.7857/2017 Assessment Order dated 03.02.2017 for the Assessment Year 2012-13 W.P.No.37133/2017 Penalty Notices U/s 274 r/w Section 271(1)(c) for Assessment Years 2006-07 to 2011-12 2. This assessment is after the Settlement Commission's Order and the proceedings related hereto. On 16.02.2012, a search is conducted under Section 132 of the Income Tax Act, 1961 [for short, 'the IT Act'], and the petitioner, who has filed returns for the Assessment Years on 24.01.2014, has filed an - 9 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER application with the Settlement Commission in Form 34B of the IT Act. In the first round of writ proceedings, the dispute was over the Settlement Commission's Order accepting the application, and the Revenue has lost in this first round of litigation. Thereafter, the Settlement Commission has passed its Order on 27.05.2016, which is called in question in W.P. Nos.46275-46289/2016 on the ground that the Settlement Commission's Order dated 27.05.2016 was time barred. 3. This writ petition is disposed of, and the Revenue has carried the Writ Court's order dated 07.12.2016 in an Intra-Court appeal in the Writ Appeal No.238/2017. This writ appeal was pending as of the date of the impugned Assessment Orders dated 03.02.2017. Presently, the writ appeal is disposed of by the Order dated 06.12.2021. The Division Bench has observed that the Settlement Commission ought to have passed its Order on or - 10 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER before 10.12.2015 and admittedly the Order is passed on 27.05.2016. 4. Mr. A. Shankar, the learned Senior Counsel for the petitioner, argues for this Court's intervention with the impugned Show Cause Notice, Assessment Orders and the Penalty Notices on the following grounds in view of the observation as aforesaid. [A] The Assessment Orders are beyond the timeline prescribed. [B] These Orders violate the principles of natural justice, and [C] The Orders are without jurisdiction as mandatory jurisdictional notice under Section 143(2) of the IT Act is not issued. 5. On the first ground, the learned counsel submits that [i] the maximum time period available for assessment, after the proceedings with the Settlement Commission abated, is one year and this - 11 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER period must be reckoned from 10.12.2015 as observed by the Division Bench and [ii] if the maximum period of one year is reckoned from 10.12.2025, the impugned Assessment Orders, which are dated 03.02.2017, would be beyond 09.12.2016 and therefore cannot be sustained. The learned Senior Counsel relies upon the Division Bench’s observations in Commissioner of Income-tax, (Central) Vs. RNS Infrastructure Ltd1 which read as under: "8. The undisputed facts are that the respondent No.1 – assessee filed an application before the Income Tax Settlement Commission under Section 245C of the Act along with the tax and interest payable thereon, on 06.02.2014. The Settlement Commission passed orders, by allowing the settlement application to be proceeded with, on 18.02.2014. Order dated 03.04.2014 was passed by the Settlement Commission under Section 245D(2)(c) of the Act declaring the application filed by the respondent No.1 – 1 [2022] 136 taxmann.com 309 (Karnataka) - 12 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER assessee as valid. W.P.No.44007/2014 and allied matters were filed by the Revenue on 08.09.2014 challenging the order of the Settlement Commission dated 03.04.2014. Interim order was granted by the writ Court on 29.04.2015 till the next date of hearing and the same was extended on 09.06.2015 but subsequently no extension of interim order was granted. Finally, the said writ petitions were dismissed on 18.01.2016. Settlement Commission passed the order under Section 245D(4) of the Act on 27.05.2016. Writ Appeal Nos.489-493/2016 filed by the Revenue against the order passed in W.P.No.44007/2014 and allied matters came to be dismissed as withdrawn on 28.09.2016. Period of limitation for passing the order by the Settlement Commission would be 18 months from the date of filing of the application. Considering the total number of 51 + 7 days wherein the interim order of stay in W.P.No.44007/2014 was in operation, the last date for passing the order by the Settlement Commission would be 10.12.2015. Thus, the Settlement Commission ought to have passed an order on or before 10.12.2015, but admittedly the order was passed on 27.05.2016........................." - 13 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER 6. Mr. A. Shankar, on the impugned Assessment Orders being without jurisdiction on the ground of mandatory jurisdiction of notice under Section 143(2) of the IT Act, refers to the decision of a Division Bench of this Court in Commissioner of Income-tax (Central) and another Vs. M/s. C. Ramaiah Reddy2, wherein the Division Bench has held thus: "8. It is pertinent to note that first and second proviso to Section 148 of the Act were inserted by Finance Act, 2006 with retrospective effect i.e., from 01.10.1991. The aforesaid proviso were incorporated and created a legal fiction to the effect that a notice issued under Section 143(2) after expiry of twelve months as specified in Section 143(2) but before completion of expiry of time limit for making assessment, reassessment or recomputation as specified in Section 153(2) in respect of return furnished between the period 01.10.1991 to 30.09.2005 will be valid. A legal fiction has been created in respect of issue of notice under Section 143(2) of the Act only in 2I.T.A.No.192/2012 decided on 24.06.2020 - 14 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER respect of returns furnished upto 30.09.2005. Thus, by insertion of the aforesaid provisos the legislature has made its intention manifest that notice under Section 143(2) of the Act has to be mandatorily issued for the initiation of assessment proceedings under Section 147 of the Act. In the instant case, the assessee filed the return of income on 19.09.2006. Therefore, the amendment made to Section 148 of the Act do not apply to the fact situation of the case and in absence of notice under Section 143(2) of the Act, the order of assessment under Section 143(3) read with Section 147 is ab initio void." The learned Senior Counsel also submits that the petitioner is issued with a Show Cause Notice dated 02.02.2017 stipulating that a reply must be submitted by 05.00 p.m. on 03.02.2017, and this is in violation because the petitioner has not been granted reasonable time. 7. Mr. 7. Mr. Y. V. Raviraj, the learned Senior counsel for the petitioner, is heard in the light of these canvases, and this Court must opine that if the - 15 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER petitioner succeeds in the writ petitions in W.P.Nos.7845/2017 and W.P.No.7857/2017, which are as against the Assessment Orders of the petitioner, the petition in W.P.No.37133/2017 must consequently be allowed as the penalty notices will not survive. This Court also opines that if the petitioner succeeds against the Assessment Orders, the petitioner's grievance as against the Show Cause Notices will also not survive. 8. The petitioner's grievance with the Assessment Orders is first tested on the ground of limitation. It is not argued that after the Division Bench's order in W.A.No.238/2017 the limitation as provided for under Section 153B of the IT Act will be for a maximum period of one year and that this period must be reckoned from 10.12.2015. The fact that the maximum permissible period of one year must be reckoned from 10.12.2015 must clinch the issue for the petitioner because the impugned order - 16 - HC-KAR NC: 2026:KHC:28055 WP No. 5075 of 2017 C/W WP No. 7845 of 2017 WP No. 7857 of 2017 AND 1 OTHER [which is dated 03.02.2017] is beyond the maximum period permitted. 9. As the petitioner succeeds on this ground, the merits of the other two grounds are not examined, and the petitions in W.P.No.7845/2017 and W.P.No.7857/2017 are favoured quashing the Assessment Orders dated 03.02.2017 relevant to the Assessment Years 2006-07 to 2011-12 and 2012-13. The writ petition in W.P.No.37133/2017, which is against the subsequent penalty notices, are consequentially allowed quashing the impugned penalty notices. Further, in the light of the above, the writ petition in W.P. No.5075/2017 is also allowed declaring the Show Cause Notices as having become infructuous. Sd/- (B M SHYAM PRASAD) JUDGE RB