Karnataka High Court
Kanakapura Venkataramanaswamy ... vs Assessemnt Unit on 4 April, 2025
Author: S.R.Krishna Kumar
Bench: S.R.Krishna Kumar
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NC: 2025:KHC:14531
WP No. 28255 of 2024
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 4TH DAY OF APRIL, 2025
BEFORE
THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR
WRIT PETITION NO. 28255 OF 2024 (T-IT)
BETWEEN:
KANAKAPURA VENKATARAMANASWAMY
MADHUSUDHAN KARTHIK,
AGED ABOUT 50 YEARS,
S/O VENKATARAMANASWAMY,
R/A. GOKUL NILAYA, BWSSB WEST,
S.KARIYAPPA LAYOUT, KANAKAPURA,
KANAKAPURA - 562 117.
PAN NO.ADUPV5834A.
...PETITIONER
(BY SRI. BALRAM R RAO, ADVOCATE)
AND:
1. ASSESSMENT UNIT,
INCOME TAX DEPARTMENT,
NATIONAL FACELESS ASSESSMENT
Digitally
signed by CENTRE, INCOME TAX DEPARTMENT,
KAVYA R DELHI,
2ND FLOOR, E-RAMP,
Location: JAWAHARLAL NEHRU STADIUM,
High Court DELHI - 110 003.
of Karnataka
2. INCOME TAX OFFICER,
WARD -1, MAGADI RAMANAGARAM ROAD,
RAMANAGAR - 562 159.
...RESPONDENTS
(BY SRI.M.DILIP, ADVOCATE)
***
THIS WRIT PETITION IS FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO ISSUE
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NC: 2025:KHC:14531
WP No. 28255 of 2024
A WRIT OF CERTIORARI OR WRIT IN THE NATURE OF
CERTIORARI OR ANY OTHER APPROPRIATE WRIT ORDER OR
DIRECTION UNDER ARTICLE 226 OF THE CONSTITUTION OF
INDIA, CALLING FOR THE RECORDS OF THE PETITIONERS
CASE AND AFTER EXAMINING THE LEGALITY AND VALIDITY
THEREOF BE PLEASED TO QUASH AND SET ASIDE THE
IMPUGNED ORDER UNDER SECTION 27ADA OF ACT DATED
10.06.2024 IN DIN. ITBA/PNL/F/271DA/2024-
25/1065515582(1) (ANNEXURE -K) AND NOTICE OF DEMAND
ISSUED U/S. 156 OF THE ACT DATED 10.06.2024 IN
DIN.ITBA/PNL/S/156/2024-25/1065513017(1) (ANNEXURE -
K1) AND NOTICE OF PENALTY U/S.24 R.W.S 271DA OF THE
ACT, VIDE ANNEXURE B1, DATED 07.12.2023 IN DIN
NO.ITBA/PNL/S/271DA/2023.24/1058532981(1) FOR THE
A.Y.2020.21 AND ETC.,
THIS WRIT PETITION, COMING ON FOR PRELIMINARY
HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE S.R.KRISHNA KUMAR
ORAL ORDER
In this petition, petitioner seeks the following reliefs.
"i. Writ of certiorari or writ in the nature of certiorari or any other appropriate writ order or direction under Article 226 of the Constitution of India, calling for the records of the petitioners case and after examining the legality and validity thereof be pleased to quash and set aside the -3- NC: 2025:KHC:14531 WP No. 28255 of 2024 impugned order under Section 27ADA of Act dated 10.06.2024 in DINITBA/PNL/F/271da/ 2024-25/1065515582(1) (Annexure -K) and notice of demand issued u/s. 156 of the Act dated 10.06.2024 in DIN.ITBA/PNL/S/156/2024- 25/1065513017(1) (Annexure -K1) and notice of penalty u/s.24 r.w.s 271DA of the Act, vide Annexure B1, dated 07.12.2023 in din NO.ITBA/PNL/S/271DA/2023.24/ 1058532981(1) for the A.Y.2020.21 .
ii.Writ of Mandamus or a writ in the nature of mandamus or any other appropriate writ, order or direction under Article 226 of Constitution of India ordering and directing the Respondents by themselves by their subordinates, servants, or agents to withdraw and cancel the impugned order under Section 27ADA of Act dated 10.06.2024 in DIN: ITBA/ PNL/ F/ 271DA /2024-25/ 1065515582 (1) (ANNEXURE-K) and notice of Demand issued u/s.156 of the Act dated 10.06.2024 in DIN:ITBA/PNL/S/156/2024-25/1065513017(1) (ANNEXURE-KA) notice of penalty u/s. 274 r.w.s.271DA of the Act dt.:07.12.2023 in DIN No.:ITBA/PNL/S/271DA /2023-24/ 1058532981 (A) (ANNEXURE B1) for the A.Y.2021-21 and iii. A writ of Prohibition or a writ in the nature of Prohibition or any other appropriate writ, order or direction under Article 226 of Constitution of India, prohibiting and restraining the Respondents by themselves their sub-
ordinates, servants and agents from taking any action in furtherance or consequent to impugned order under Section 27ADA of Act dated 10.06.2024 in DIN:ITBA/PNL/F/271DA/2024- 25/1065515582(1) (ANNEXURE K) and notice of Demand issued u/s.156 of the Act dated 10.06.2024 in DIN:ITBA/PNL/S/156/2024- 25/1065513017(1) (Annexure K1) for the A.Y. 2020-21 passed by respondents.
-4-NC: 2025:KHC:14531 WP No. 28255 of 2024 iv. Grant the interim relief in terms of prayer (iii) above, and v. Issue such other order, writ or direction as this Hon'ble Court deems fit."
2. Heard the learned counsel for petitioner, learned counsel for respondents and perused the material on record.
3. A perusal of the material on record will indicate that, the first respondent passed an assessment order dated 07.12.2023, raising total tax demand of `13,04,314/-, pursuant to which, a notice under Section 274 read with Section 271 DA of the Income Tax Act was issued by the first respondent, calling upon the petitioner to show cause as to why penalty should not be imposed upon the petitioner. Subsequently, on 19.12.2023, the petitioner filed a statutory appeal before the competent authority, which is pending consideration even as on today.
4. Under these circumstances, the petitioner submitted repeated replies, representations, etc. calling -5- NC: 2025:KHC:14531 WP No. 28255 of 2024 upon the first respondent to keep the penalty proceedings in abeyance on the ground that, the appeal was pending against the original assessment order.
5. It is the grievance of the petitioner that despite the petitioner filing an appeal against the assessment order coupled with repeatedly requesting the first respondent to keep the penalty proceedings in abeyance on the ground that an appeal was pending consideration, the first respondent has proceeded to pass the impugned order dated 10.06.2024 vide Annexure K, followed by subsequent notice at Annexure K1, which are assailed in the present petition.
In support of the submission, he places reliance upon the order passed by this Court in the case of ANJANADRI FUEL STATION Vs. INCOME TAX OFFICER AND ANOTHER passed in WRIT PETITION No.6164/2024 (T-IT), wherein it is held as under:
"In this petition, the petitioner seeks the following reliefs:-6-
NC: 2025:KHC:14531 WP No. 28255 of 2024 "i) Writ of Certiorari or writ in the nature of certiorari or any other appropriate writ order or direction under Article 226 of the Constitution of India; calling for the records of the Petitioners case and after examining the legality and validity thereof be pleased to quash and set aside the impugned order under Section 270A of Act dated 18.09.2023 in DIN:ITBA/PNL/F/270A/2023-24/ 1056251767(1) (Annexure-G) and Notice of Demand issued u/s 156 of the Act dated 18.09.2023 in DIN ITBA/PLN/S/156/2023-
24/1056249880(1) (Annexure-G1) for the AY 2018-19 and impugned order under Section 272A(1)(d) of Act dated 13.10.2023 in DIN and Order No. ITBA/ PNL/ F/ 272A (1) (D) /2023-24/ 1057044932 (1) (Annexure-H) and Notice of Demand issued u/s 156 of the Act dated 13.10.2023 in DIN:ITBA/PNL/S/156 /2023- 24/1057041710 (1) (Annexure-H1) for the AY 2018-19.
(ii) Writ of Mandamus or a writ in the nature of mandamus or any other appropriate writ, order or direction under Article 226 of Constitution of India ordering and directing the Respondents by themselves by their subordinates, servants or agents to withdraw and cancel the impugned order under Section 270a of Act dated 18.09.2023 in DIN:
ITBA/PNL/F/270A/2023-24/ 1056251767(1) (Annexure-G) and Notice of Demand issued u/s 156 of the Act dated 18.09.2023 in DIN:
ITBA/PNL/S/156/2023-24/1056249880(1) (Annexure-G1) for the AY 2018-19 and impugned order under Section 272A(1)(D) of Act dated 13.10.2023 in DIN and Order No. ITBA/ PNL/ F/ 272A(1) (D) / 2023-24 / 1057044932 (1) (Annexure-H) and Notice of Demand issued u/s 156 of the Act dated 13.10.2023 in DIN:
ITBA/ PNL/S/ 156/ 2023-24/ 1057041710 (1) (Annexure-H1) for the Ay 2018-19
(iii) A writ of Prohibition or a writ in the nature of Prohibition or any other appropriate writ, order or direction under Article 226 of Constitution of India prohibiting and restraining -7- NC: 2025:KHC:14531 WP No. 28255 of 2024 the Respondents by themselves their sub ordinates, servants and agents from taking any action in furtherance or consequent to impugned order under Section 270A of Act dated 18.09.2023 in DIN.ITBA/PNL/F/270A/2023-24/ 1056251767 (1) (Annexure-G) and Notice of Demand issued u/s 156 of the Act dated 18.09.2023 in DIN: ITBA /PNL /S/ 156 /2023-
24/ 1056249880 (1) (Annexure-G1) for the AY 2018-19 and impugned order under Section 272A(1)(D) of Act dated 13.10.2023 in DIN and Order No. ITBA/PNL/ F/ 272A(1) (D)/2023-24 / 1057044932 (1) (Annexure-H) and Notice of Demand issued u/s 156 of the Act dated 13.10.2023 in DIN: ITBA/PNL/S/156/2023- 24/1057041710 (1) (Annexure-H1) for the AY 2018-19 of the Act for the Assessment Year 2015-16 passed by Respondents.
(iv) Grant the interim relief in terms of prayer (iii) above, and
(v) Issue such other order, writ or direction as this Hon'ble Court deems fit."
2. Heard learned counsel for the petitioner, learned counsel for the respondents and perused the material on record.
3. In addition to reiterating the various contentions urged in the petition and referring to the material on record, learned counsel for the petitioner submits that aggrieved by the Assessment Order dated 30.03.2023 passed by the respondents for the Assessment Year 2018-19, the petitioner filed an appeal on 12.05.2023. It is the grievance of the petitioner that despite pendency of the appeal before the Appellate Authority, the respondents have proceeded to issue penalty notice -8- NC: 2025:KHC:14531 WP No. 28255 of 2024 and show-cause notice followed by the impugned penalty orders and demand notice, which are assailed in the present petition inter alia contending that since the appeals were pending, it would be necessary to keep the penalty orders and demand notices in abeyance till disposal of the appeals as held by this Court in the case of Mr. B.S. Uday Shetty Vs. The Assistant Commissioner of Income Tax - W.P.No.8585/2022 dated 21.04.2022.
4. Per contra, learned counsel for the respondents submits that even the impugned penalty orders are appealable orders and as such, keeping the penalty orders and demand notice in abeyance till disposal of the appeal would not arise in the facts and circumstances of the instant case and as such, there is no merit in the present petition and the same is liable to be dismissed.
5. A perusal of Section 275 of the I.T. Act will indicate that there is clear embargo/bar on proceeding to pass penalty order if an appeal is pending on the Assessment Order. As rightly contended by the learned counsel for the petitioner in B.S. Uday Shetty's case (supra), under identical circumstances, where the petitioner-Assessee did not file an appeal against the Original Assessment Order, this Court came to the conclusion that till disposal of the appeals filed by the Assessee, it is -9- NC: 2025:KHC:14531 WP No. 28255 of 2024 necessary to keep the penalty orders and notices in abeyance. In view of the aforesaid facts and circumstances and the judgment of this Court in B.S. Uday Shetty's case (supra), rendered under identical circumstances, the present petition also deserves to be disposed of keeping penalty orders and demand notices in abeyance till disposal of the appeals filed by the petitioner.
6. In the result, I pass the following:
ORDER i. The Writ Petition is allowed.
ii. The impugned orders at Annexures-G and H
dated 18.09.2023 and 13.10.2023
respectively, and the demand notices at Annexure-G1 and H1 dated 18.09.2023 and 13.10.2023 are hereby kept in abeyance till disposal of the appeals filed by the petitioner.
iii. Liberty is reserved in favour of the respondents to proceed further upon disposal of the appeals filed by the petitioner."
6. Per contra, learned counsel for the respondents submits that there is no merit in the petition and the same is liable to be dismissed.
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NC: 2025:KHC:14531 WP No. 28255 of 2024
7. As rightly contended by the learned counsel for the petitioner, in the light of the provisions contained in Section 275 of the Income Tax Act coupled with the order passed by this Court in ANJANADRI FUEL STATION'S CASE (SUPRA), having regard to the undisputed fact that the appeal filed by the petitioner was still pending adjudication, Section 275 of the Act would act as a complete bar/embargo to pass a penalty order as against the petitioner which is impermissible in law, warranting interference by this Court in the present petition.
8. In the result, I pass the following:
ORDER i. The Writ Petition is allowed.
ii. The impugned order at Annexure K dated 10.06.2024 and the notice of demand dated 10.06.2024 at Annexure K1 are hereby kept in abeyance till disposal of the appeal filed by the petitioner.
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NC: 2025:KHC:14531 WP No. 28255 of 2024 iii. Liberty is reserved in favour of the respondents to proceed further upon disposal of the appeal filed by the petitioner.
Sd/-
(S.R.KRISHNA KUMAR) JUDGE BMV*/List No.: 1 Sl No.: 11