The Karnataka High Court quashed the entire chain of faceless reassessment proceedings, including Section 148A, Section 147, and penalty orders. The ruling was based on the reason that the notices were issued by the jurisdictional AO outside the mandatory procedure of Section 151A (Faceless Assessment Scheme). The key takeaway is the non-compliance with the statutory mechanism for faceless proceedings invalidates the entire reassessment.
The Karnataka High Court ruled that reassessment under Section 153A is invalid when no incriminating material is found during a search. The Court held that conversion of a firm into a company, fulfilling Section 47(xiii) conditions, is not taxable as a transfer.
The Karnataka High Court disposed of the Buckeye Trust petition after the ITAT President assigned the matter to a new bench, following a High Court order that restrained a Judicial Member involved in an allegedly AI-driven decision from hearing the case.
The Karnataka High Court affirmed that SEZ units can claim Section 10AA deduction on income enhanced through a voluntary Advance Pricing Agreement (APA) adjustment. The ruling clarifies that the bar under Section 92C(4) applies only to income enhanced by the Assessing Officer, not to voluntary APA compliance.
Karnataka HC ruled that an order giving effect to Tribunal directions passed after three-month limit under Section 153(5) is time-barred. Court upheld refund of ₹4.73 crore with interest under Sections 244A(1)(b) and 244A(1A).
The Karnataka High Court ruled that a bank is bound to comply with an Arbitral Tribunal’s order, such as freezing an account, without requiring separate execution proceedings. The key takeaway is that a bank’s compliance with a direct arbitral directive is lawful and not contingent on a civil court’s enforcement order.
The Karnataka High Court affirmed the legality of an ED arrest made in Sikkim concerning a Bengaluru-registered money-laundering case. The ruling establishes that PMLA confers pan-India jurisdiction on the ED, making the geographical location of the arrest irrelevant if a valid ECIR exists.
Court upheld Canara Bank’s decision to permanently cut a retired Chief Manager’s pension for issuing an unauthorised ₹300 crore manual LoC, ruling that grave misconduct proceedings can continue post-retirement under Bank Regulations 43 and 45.
Karnataka High Court granted anticipatory bail in a PMLA case noting that the predicate offence was still under police investigation and the accused was already on regular bail, making further custodial interrogation unnecessary.
Karnataka High Court held that banks cannot refuse to produce original mortgage documents when a property transaction is under police investigation for forgery or impersonation. Court clarified that holding documents as security does not exempt banks from cooperation under Section 94 of BNSS, 2023. Canara Bank’s plea against the police notice was dismissed, ensuring transparency in fraud investigations.
