In a recent ruling, the Karnataka High Court quashed the Income Tax notice under Section 148 of the Income Tax Act, 1961 and granted the petitioner a chance to submit replies before the income tax department as the omission was due to bonafide reasons.
In this case, the writ petition was filed by the petitioner, Varaha Builders, against the notices issued by the department under Sections 148A(b) and 148 of the Income Tax statute for the assessment year 2016-17. In the petition, it was contended by the petitioner that the notices were neither received nor responded to due to bona fide reasons, leaving them unable to present their case or submit supporting documents.
Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here
It was contended by the counsel on behalf of the department that the petition lacked merit and that it should be dismissed.
The bench observed that the impugned order revealed that the petitioner did not submit a reply or documents in response to the Section 148A(b) notices. The bench, by considering the claim of the petitioner that the omission to file a reply was due to bona fide reasons and unavoidable circumstances, and that they are now prepared to submit the reply with documents if given another opportunity, set aside the impugned order dated 21.03.2023 under Section 148A(d) of the Income Tax Act, 1961, and related notices and orders.
The bench also observed that ‘Liberty is reserved in favor of the petitioner to submit additional pleadings, documents, etc., to the respondent No. 1, who shall consider the same and proceed further in accordance with law’.
Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here
Justice S.R. Krishna Kumar, remitted the case back to the Income Tax Officer for reconsideration from the stage of reply submission and directed that it should be dealt in accordance with the law.
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