Rajesh Jaswanth Rai Mehta Vs CIT (Appeals) (Karnataka High Court)
The Karnataka High Court partly allowed the writ petition by setting aside the appellate order insofar as it rejected the claim of business loss, on the ground of violation of principles of natural justice. The Court noted that the assessee had specifically sought a personal hearing, but the Appellate Authority passed the order without granting such opportunity. Recognizing that the assessee intended to produce supporting documents such as invoices, vouchers and bank statements, the Court held that denial of hearing prejudiced the case.
Accordingly, the matter relating to business loss was remitted for fresh consideration, while the rest of the appellate order-particularly findings on unsecured loans (in favour of the assessee)-was left undisturbed. The assessee was granted liberty to present evidence upon remand.
FULL TEXT OF THE JUDGMENT/ORDER OF KARNATAKA HIGH COURT
The petitioner has sought for setting aside of the order dated 10.02.2026 passed by the Appellate Authority at Annexure-A to the extent of business loss.
2. It is to be noticed that the assessment order came to be challenged by way of appeal on various grounds and the appeal came to be allowed-in-part while upholding contentions of the petitioner relating to unsecured loans and remitting the matter back to the assessing officer while making certain observations.
