Siddaraju Vs ITO (Karnataka High Court)
Reassessment & Penalty Orders Set Aside Due to Non-Filing of Return for Bona Fide Reasons; Fresh Opportunity Granted
The Karnataka High Court, in Sri Siddaraju vs. Income Tax Officer & Ors. (W.P. No. 37468 of 2025, order dated 11-Dec-2025), set aside the reassessment order u/s 147 r/w ss.144 & 144B and the consequential penalty orders u/s 271(1)(b), 271(1)(c) & 271F for AY 2014-15, holding that the Assessee was denied a meaningful opportunity to comply with the reassessment proceedings.
The Court accepted the Assessee’s explanation that the notice u/s 148 dated 22-03-2021 and subsequent communications went unnoticed due to an inactive email account, constituting bona fide and unavoidable circumstances. Observing that the Assessee sought one more opportunity to file the return of income, the Court held that the interests of justice required setting aside the ex parte assessment and penalty proceedings.
Accordingly, all impugned orders and notices were quashed, and the matter was remanded to the Assessing Officer to recommence proceedings from the stage of filing return of income in response to the s.148 notice, with liberty to the Assessee to place additional material on record and directions to the Revenue to proceed afresh in accordance with law.
FULL TEXT OF THE JUDGMENT/ORDER OF KARNATAKA HIGH COURT
In this petition, petitioner seeks for the following reliefs:-
“i) Issue a writ of certiorari or direction in the nature of a writ of certiorari quashing the notice under Section 148 of the Act dated 22.03.2021 bearing DIN No.ITBA/AST/S/148/ 2020-21/1031643938(1) issued by the Respondent No.1 for the assessment year 2014-15 herein marked as Annexure-A.
ii) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the order under Section 147 r.w.s 144, 144B of the Act dated 24/03/2022 bearing DIN No.ITBA/AST/S/147/2021-22/1041531642(1) passed by the Respondent No.2 for the assessment year 2014-15 herein marked as Annexure-A1.
iii) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the penalty order passed under Section 271(1)(b) of the Act dated 29/08/2022 bearing DIN No.ITBA/PNL/F/271F/2022-23/1045025385(1) by the Respondent No.1 for the assessment year 2014-15 herein marked as Annexure-A2.
iv) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the penalty order passed under Section 271(1)(c) of the Act dated 29/08/2022 bearing DIN No.ITBA/PNL/F/271(1)(b)/2022-23/1045242622(1) by the Respondent No.1 for the assessment year 2014-15 herein marked as Annexure-A3.
v) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the order passed under Section 271F dated 29/08/2022 bearing DIN No.ITBA/PNL/F/271(1)(C)/ 2022-23/1045071492(1) passed by the Respondent No.1 for the assessment year 2014-15 herein marked as Annexure-A4.
vi) And pass such other orders as this Hon’ble Court deems fit and proper in the interest of justice and equity.”
2. Heard learned counsel for the parties and perused the material on record.
