Gokul Hotels V. National Faceless Assessment Centre and Income Tax Officer Assessment Unit, DCIT/ACIT, Circle-1, Bellary

WP/27889/2024

AI Insights

The case involves M/s Gokul Hotels, an unregistered partnership firm, challenging the assessment order and demand notice issued by the National Faceless Assessment Centre and the Income Tax Officer, Bellary, under various sections of the Income Tax Act, 1961. The petitioner argued that subsequent notices following the initial notice under Section 148 were not served, and thus they could not respond to the show cause notice. The court found that the assessment was made on the principle of best judgment without the petitioner's input on merits, leading to the decision to set aside the assessment and related orders and remand the matter for a fresh assessment after allowing the petitioner to file the necessary return.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 834750 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 04-02-2026
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: M THIRUMALESH
• Assessee Lawyers: MANOJ N
• Keywords: Assessment Order; Best Judgment Assessment; Demand notice; Income Tax; Writ petition
• Section: 147; 144; 144B; 156; 226; 227

Judgement Text

" - 1 - HC-KAR NC: 2026:KHC:6388 WP No. 27889 of 2024 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 4TH DAY OF FEBRUARY, 2026 BEFORE THE HON'BLE MR. JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 27889 OF 2024 (T-IT) BETWEEN: 1. M/S GOKUL HOTELS O/AT NO.53, NAYANDAHALLI, KENGERI HOBLI, BENGALURU-560 039 ALSO AT: ANANTAPUR ROAD, NEAR BYE PASS ROAD, BELLARY - 583 103 REPRESENTED BY ITS PARTNER SRI. D RAJESH S/O D VENKATESHALU AGED ABOUT 40 YEARS R/AT PARVATHI NAGAR, NEAR LAW COLLEGE, BELLARY - 583 103 PETITIONER IS A UNREGISTERED PARTNERSHIP FIRM … PETITIONER (BY SRI. MANOJ S N., ADVOCATE) AND: 1. NATIONAL FACELESS ASSESSMENT CENTRE REPRESENTED BY ADDITIONAL/JOINT/DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX INCOME TAX DEPARTMENT, MINISTRY OF FINANCE, Printed from counselvise.com Digitally signed by VIJAYA P Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:6388 WP No. 27889 of 2024 ROOM NO.401, 2ND FLOOR, E-RAMP, JAWAHARLAL NEHRU STADIUM, NEW DELHI - 110 003 2. THE INCOME TAX OFFICER ASSESSMENT UNIT, DCIT/ACIT, CIRCLE-1, BELLARY, AAYAKAR BHAVAN, FORT, STAFF ROAD, BELLARY-583 102 … RESPONDENTS (BY SRI. M. THIRUMALESH, ADVOCATE) THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE ASSESSMENT ORDER NO. ITBA/AST/5/147/2023-24/1062152624(1) DTD. 07.03.2024 (ANNEXURE-A) PASSED UNDER SECTION 147 R/W SECTION 144 AND 144B OF THE INCOME TAX ACT, FOR THE ASSESSMENT YEAR 2018-19 BY THE R-1 AND ALL CONSEQUENTIAL PROCEEDINGS.QUASH THE DEMAND NOTICE DTD. 07.03.2024 ISSUED UNDER SECTION 156 OF THE INCOME TAX ACT BEARING DIN NO. ITBA/AST/S/156/2023-24/1062152789(1) (ANNEXURE-B) PASSED BY THE R-1 AND ETC. THIS PETITION COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE S SUNIL DUTT YADAV ORAL ORDER Petitioner has called in question the correctness of the assessment order at Annexure-A passed under Section 147 read with Section 144B of the Income Tax Act, 1961 (for short 'the Act') for the assessment year 2019-20. Petitioner has also challenged the demand notice at Printed from counselvise.com - 3 - HC-KAR NC: 2026:KHC:6388 WP No. 27889 of 2024 Annexure B; computation order/sheet at Annexure-C and further proceedings. 2. It is the case of the petitioner that the petitioner did not file return in response to the notice under Section 148 of the Act. It is the further case of the petitioner that he did not make out reply to the show cause notice as the same was not served. Though notice under Section 148 was served, the subsequent notices were not served. 3. It is the case of the petitioner that insofar as the variation is concerned, he has an explanation to offer and accordingly seeks that the matter be remanded with fresh opportunity. 4. In light of the case made out and noticing that the order is passed on the principle of best judgment assessment and has proceeded without any stand of the petitioner on merits, it would be appropriate to remit the matter back to the stage of filing of return in response to Printed from counselvise.com - 4 - HC-KAR NC: 2026:KHC:6388 WP No. 27889 of 2024 notice under Section 148 of the Act. All contentions are kept open. 5. Accordingly, the assessment order at Annexure- A is set aside. The consequential demand notice at Annexure-B, computation order/sheet at Annexure-C and consequential proceedings pursuant to Annexure-A are also set aside. Petitioner to file return within a period of 3 weeks from the date of receipt of certified copy of the order. All contentions are kept open. 6. Writ petition is accordingly disposed of. SD/- (S SUNIL DUTT YADAV) JUDGE VP Printed from counselvise.com "