Kargode Chandrashekar Dayananda Vs Assessment Unit (Karnataka High Court)
Section 148 Missed the 1 April Deadline: Karnataka HC Buries AY 2015–16 Reassessment With Its Penalty & Recovery Baggage
Summary: In Kargode Chandrashekar Dayananda v. Assessment Unit, NFAC, decided on 7 July 2026, the Karnataka High Court quashed reassessment proceedings for AY 2015–16 because the proceedings u/s 148A & notice u/s 148 were initiated after 1 April 2021.
The assessee, a 76-year-old individual, was subjected to reassessment through a show-cause notice dated 19 March 2022 u/s 148A(b). This was followed by an order dated 29 March 2022 u/s 148A(d) holding that it was a fit case for issuance of notice u/s 148. On the same day, the AO issued the consequential notice u/s 148 for AY 2015–16.
The proceedings culminated in an ex parte assessment order dated 16 March 2023 u/s 147 r/w Sections 144 & 144B. A computation sheet & demand notice u/s 156 were issued simultaneously.
The Department thereafter passed a penalty order dated 18 September 2023 u/s 271F, along with a consequential computation sheet & demand notice. Recovery action was also initiated through a garnishee notice dated 10 November 2023 u/s 226(3) addressed to Karnataka Bank. Further proceedings under the Second Schedule were commenced on 12 August 2025.
