Clipped from: https://taxguru.in/corporate-law/faceless-reassessment-quashednotices-issued-section-151a-scope.html
Navnidhi Infrastructure Private Limited Vs DCIT (Karnataka High Court)
Karnataka HC quashes reassessment notices issued beyond Section 151A mandate — grants liberty to Revenue to revive post-SC verdict
The Petitioner-company, represented by Director, challenged a series of reassessment proceedings for AY 2020-21, including:
- Notice u/s 148A(1) dated 22.03.2025,
- Letter dated 12.06.2025,
- Order u/s 148A(3) dated 27.06.2025, &
- Notice u/s 148 dated 27.06.2025.
The Petitioner contended that the notices were issued beyond the statutory limits prescribed u/s 151A & thus lacked jurisdiction. The Respondents (Revenue) were represented by Sri Tirumalesh M., Advocate. The Petitioner relied upon the Co-ordinate Bench ruling in Ramachandra Reddy Ravi Kumar v. DCIT (WP No.17352/2022 & batch, decided on 28.08.2025), wherein similar notices were quashed on the ground that they were issued outside the permissible scope of Sec. 151A of the Act, which delineates the jurisdictional & procedural authority for issuance of notices under the faceless
reassessment scheme. Justice S.R. Krishna Kumar accepted that the issue was squarely covered by the above precedent & therefore the same reasoning applied to the present case.
Held
- Petition allowed following Ramachandra Reddy Ravi Kumar (supra).
- All impugned notices & orders — Annexure-A1 (22.03.2025), A2 (12.06.2025), A3 & A4 (both 27.06.2025) — quashed as being outside the scope of Sec. 151A.
- Liberty granted to the Revenue to seek revival of proceedings depending on the outcome of pending cases before the Supreme Court on the same issue.
- All rival contentions kept open.
This ruling is part of the growing line of Karnataka HC decisions following Ramachandra Reddy Ravi Kumar, striking down reassessment notices issued by non-jurisdictional authorities under the faceless regime. The Court reiterated that until the Supreme Court clarifies the validity of such faceless reassessment procedures, any notices issued in contravention of Sec. 151A stand void ab initio — while keeping the door open for revival if the apex court later upholds the Department’s position.
FULL TEXT OF THE JUDGMENT/ORDER OF KARNATAKA HIGH COURT
In this petition, the petitioner seeks the following reliefs:
“i) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the notice dated 22.03.2025 issued under Section 148A(1) of the Income Tax Act, 1961 for the assessment year 2020-21 by the Respondent No.1 bearing DIN and Notice No.ITBA/AST/F/148A(SCN)-1/2024- 25/1074872147(1) herein marked as Annexure-A1;
ii) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the notice dated 12.06.2025 issued for the assessment year 2020-21 by the Respondent No.1 bearing DIN & Letter No.ITBA/COM/F/17/2025-26/1076967126(1) herein marked as Annexure-A2;
iii) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the order dated 27.06.2025 passed issued under Section 148A(3) of the Income Tax Act, 1961 for the Assessment Year 2020-21 by the Respondent No.1 bearing DIN & Notice No.ITBA/AST/F/148A/2025-26/1077943148(1) herein marked as Annexure-A3;
iv) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the notice 27.06.2025 passed issued under Section 148 of the Income Tax Act, 1961 for the Assessment Year 202021 by the Respondent No.1 bearing DIN & Notice No. ITBA/AST/F/148-1/2025-26/1077943249(1) herein marked as Annexure-A4;
v) 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 petitioner and learned counsel for the respondents and perused the material on record.
3. In addition to reiterating the various contentions urged in the memorandum of petition and referring to the material on record, learned counsel for the petitioner invited my attention to the order of a Coordinate Bench of this Court in the case of Ramachandra Reddy Ravi Kumar Vs. Deputy Commissioner of Income-tax – W.P.No.17352/2022 and connected matters – dated 28.08.2025, in order to contend that the present petition deserves to be allowed and disposed of in terms of the said order.
4. Per contra, learned counsel for the respondents submits that there is no merit in the petition and that the same is liable to be dismissed.
5. As rightly contended by the learned counsel for the petitioner the present petition is directly and squarely covered by the decision of a Co-ordinate Bench of this Court in the case of Ramachandra Reddy Ravi Kumar Vs. Deputy Commissioner of Income-tax – W.P.No.17352/2022 and connected matters – dated 28.08.2025, the operative portion of which reads as under:
“13. I, therefore, pass the following:
O R D E R
(i) The impugned show cause notices issued by the jurisdictional Assessing Officer outside the scope of Section 151-A of the Act stand obliterated. All further proceedings initiated thereto, challenged in these cases would stand quashed.
(ii) Liberty is reserved to the respondents – revenue to revive all these petitions in the event the Apex Court would hold in favour of the Revenue in the pending before it.
(iii) With the aforesaid liberty and to the aforesaid extent, the petitions are allowed.
(iv) Contentions of both the parties except the one noted hereinabove, shall remain open to be considered in the event revival of these petitions would become necessary.”
6. The aforesaid order is applicable to the facts and circumstances of the instant case and consequently, the present petition also deserves to be disposed of in terms of the judgment of co-ordinate Bench of this Court in Ramachandra Reddy’s case (supra).
7. In the result, I pass the following:
ORDER
(i) The petition is allowed and disposed of in terms of the decision of a Co-ordinate Bench of this Court in the case of Ramachandra Reddy Ravi Kumar Vs. Deputy Commissioner of Income-tax – W.P.No.17352/2022 and connected matters – dated 28.08.2025.
(ii) The impugned show cause notices and consequential orders at Annexure-A1 dated 22.03.2025; Annexure-A2 dated 12.06.2025; Annexure-A3 dated 27.06.2025 and Annexure-A4 dated 27.06.2025 are hereby quashed.
(iii) Liberty is reserved in favour of the respondents – Revenue to seek revival of this petition, subsequent to disposal of the matters pending before the Apex Court and all rival contentions between the parties in this regard are kept open and no opinion is expressed on the same.
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