KASTHURI MEDIAS PRIVATE LIMITED V. THE ASSISTANT DIRECTOR OF INCOME TAX

WP/2027/2026

AI Insights

The case involves Kasthuri Medias Private Limited, which filed a writ petition against the Assistant Director of Income Tax, Central Processing Unit, and the Deputy Commissioner of Income Tax, challenging an order that invalidated its income tax return for the assessment year 2024-2025. The petitioner argued that its turnover, which includes exempt income from asset sales, does not exceed Rs. 10 crores, and thus, it should not be subjected to an audit under Section 44AB of the Income Tax Act. The court, considering the petitioner's contention and the procedural nature of the order, decided to set aside the invalidation and remand the matter for further examination.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 840670 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 18-02-2026
• Assessment Year: misc
• Laws Referred To: Constitution of India, Income Tax Act 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: ARAVIND CHAVAN; E I SANMATHI
• Assessee Lawyers: NARENDRA JAIN
• Keywords: Audit; Exempt income; Income Tax; Turnover; Writ petition
• Section: 44AB; 139(9); 226; 227

Judgement Text

" - 1 - HC-KAR NC: 2026:KHC:9860 WP No. 2027 of 2026 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 18TH DAY OF FEBRUARY, 2026 BEFORE THE HON'BLE MR. JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 2027 OF 2026 (T-IT) BETWEEN: 1. KASTHURI MEDIAS PRIVATE LIMITED 12, 12/1, FIRST FLOOR, KASTURBA ROAD BENGALURU-560 015 (REPRESENTED BY ITS DIRECTOR MRS. THALAGAVARA SEETHARAM ANITHA KUMARASWAMY, D/O MR. THALAGAVARA CHANNAPPA SEETHARAM AGED ABOUT 61 YEARS) REGISTERED UNDER COMPANIES ACT 1956 … PETITIONER (BY SRI. NARENDRA KUMAR J. JAIN., ADVOCATE) AND: 1. THE ASSISTANT DIRECTOR OF INCOME TAX CENTRAL PROCESSING UNIT (CPC) INCOME TAX DEPARTMENT BENGALURU-560 500 2. THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE 2(2)(1) BMTC BUILDING, KORAMANGALA, BANGALORE-560 095 … RESPONDENTS (BY SRI. ARAVIND V. CHAVAN, ADVOCATE FOR R1; SRI E.I. SANMATHI, ADVOCATE FOR R2) Printed from counselvise.com Digitally signed by VIJAYA P Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2026:KHC:9860 WP No. 2027 of 2026 THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH AS FAR AS THE PETITIONER IS CONCERNED BY AN APPROPRIATE WRIT OR ORDER IN THE NATURE OF CERTIORARI OR OTHERWISE THE IMPUGNED ORDER VIDE CPC/2425/G5E/5540731713 00924 DATED 18.12.2025 ISSUED BY THE LEARNED FIRST RESPONDENT UNDER SECTION 139(9) FOR AY 2024-25, ENCLOSED IN ANNEXURE-E 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 Sri. Aravind Chavan, learned counsel accepts notice for respondent No.1. Sri. E. I. Sanmathi, learned counsel accepts notice for respondent No.2. 2. Petitioner has sought for setting aside of the order at Annexure-E and has also sought for a direction to the respondents consequent to setting aside of the order at Annexure-E to process the income tax returns of the petitioner for the assessment year 2024-2025. 3. The case of the petitioner is that the petitioner is aggrieved by the order invalidating the return in terms Printed from counselvise.com - 3 - HC-KAR NC: 2026:KHC:9860 WP No. 2027 of 2026 of Annexure-E with the observation that taxpayer has offered gross receipt or income under the head \"Profits and Gains of Business or Profession\" more than Rs.10 crores, while books of account are not audited under Section 44AB of Income Tax Act. 4. It is the case of the petitioner that the turnover of the petitioner cannot be construed to be above Rs.10 crores in light of part of income of the petitioner being exempt as such income of the petitioner is constituted of sale of assets which cannot be construed to be turnover. It is submitted that petitioner has material to demonstrate such contention and assertion, which would eventually lead to his income being construed to be less than Rs.10 crores. 5. Sri. E. I. Sanmathi, learned counsel appearing for respondent No. 2 would submit that the communication at Annexure-E is computer generated from the Centralized Processing Center and the Court, taking note of the stand Printed from counselvise.com - 4 - HC-KAR NC: 2026:KHC:9860 WP No. 2027 of 2026 of the petitioner, may direct respondent No. 2 to hear the petitioner and forward appropriate report thereafter to respondent No.1. 6. In light of the said stand and taking note of the contention of the petitioner, the order at Annexure-E invalidating the return of income of petitioner is set aside. The matter is remitted to respondent No. 2. 7. Petitioner to appear before respondent No. 2 without further notice on 16.03.2026. Petitioner then to demonstrate that the turnover of the petitioner is less than Rs.10 crores and question of audit under Section 44AB of the Income Tax Act would not apply. Consequential to such explanation, respondent No.2 may take note of the contentions and forward the report to respondent No.1, with its opinion. 8. Accordingly, the petition is disposed of. SD/- (S SUNIL DUTT YADAV) JUDGE VP Printed from counselvise.com "