Tghe Pr. Commissioner Of Income Tax vs The National Welfare Urban Co-Op Credit ...
2025 Latest Caselaw 5721 Kant

Citation : 2025 Latest Caselaw 5721 Kant
Judgement Date : 18 August, 2025

Karnataka High Court

Tghe Pr. Commissioner Of Income Tax vs The National Welfare Urban Co-Op Credit ... on 18 August, 2025

Author: S.Sunil Dutt Yadav

Bench: S.Sunil Dutt Yadav

                                                 -1-
                                                         NC: 2025:KHC-D:10328-DB
                                                         ITA No. 100016 of 2024


                    HC-KAR



                        IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
                              DATED THIS THE 18TH DAY OF AUGUST, 2025
                                              PRESENT
                             THE HON'BLE MR. JUSTICE S.SUNIL DUTT YADAV
                                                 AND
                             THE HON'BLE MR. JUSTICE VIJAYKUMAR A.PATIL
                                 INCOME TAX APPEAL NO.100016 OF 2024
                   BETWEEN:
                   1.   THE PRINCIPAL COMMISSIONER OF INCOME-TAX,
                        C.R. BUILDING, NAVANAGAR, HUBBALLI 580025.

                   2.   THE INCOME TAX OFFICER, WARD -1 (1).
                        C.R. BUILDING, NAVANAGAR, HUBBALLI 580025.
                                                               -       APPELLANTS
                   (BY SRI. M. THIRUMALESH AND
                   SMT. ROOPA ANAVEKAR, ADVOCATES)

                   AND:
                   THE NATIONAL WELFARE URBAN CO-OP,
                   CREDIT SOCIETY LTD.,
                   J.M. ARCADE, LINE BAZAAR, DHARWAD 580001,
                   KARNATAKA. PAN: AAEAT9679F.
                                                               -       RESPONDENT

                          THIS INCOME TAX APPEAL IS FILED UNDER SECTION 260A OF
Digitally signed
by VINAYAKA B V    INCOME TAX ACT, 1961, PRAYING TO SET ASIDE THE ORDER
Location: High
Court of
Karnataka,
                   PASSED BY THE INCOME TAX APPELLATE TRIBUNAL, BENGALURU IN
Dharwad Bench
                   I.T.A. NO. 666/BANG/2023 DATED 30.11.2023 FOR ASSESSMENT
                   YEAR 2017-18 (ANNEXURE A) AND THE ORDER OF THE APPELLATE
                   COMMISSIONER (ANNEXURE-C), ON THIS ISSUE AND CONFIRM THE
                   ORDER PASSED BY THE INCOME TAX OFFICER, WARD-1(1),
                   HUBBALLI & ETC.

                         THIS INCOME TAX APPEAL COMING ON FOR ADMISSION THIS
                   DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:

                   CORAM:      THE HON'BLE MR. JUSTICE S.SUNIL DUTT YADAV
                               AND
                               THE HON'BLE MR. JUSTICE VIJAYKUMAR A.PATIL
                                -2-
                                      NC: 2025:KHC-D:10328-DB
                                       ITA No. 100016 of 2024


HC-KAR




                       ORAL JUDGMENT

(PER: THE HON'BLE MR. JUSTICE S.SUNIL DUTT YADAV)

The appeal has been filed under Section 260-A of the

Income Tax Act challenging the order passed in I.T.A. No.

666/Bang/2023 relating to assessment year 2017-18. It is

noticed that the tax effect in the appeal in terms of the

circular dated 17.09.2024 is below Rs. 2 crores.

2. Learned counsel for the appellants has filed a memo

which reads as under:

"That the appellants have filed the above mentioned appeal challenging the ITAT order dated 30.11.2023. As per the CBDT Circular dated 17.09.2024 the matter falls under the Below Monetary Limit, i.e., 2 crore and the tax effect is less than 2 crore. Therefore, the above appeal needs to be withdrawn as per the Circular."

3. The substantial questions of law raised are as

follows:

1. Whether on the facts and in the circumstances of the case and in law, the Learned Income Tax Appellate Tribunal was correct in holding the Cash transitions and

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deposit of Specified bank Notes, done after specified date, in violation of Government of India Gazette Notification No.2652, can be called a genuine transaction and delete addition made u/s 68 of the Income Tax Act?

2. Whether on the facts and in the circumstances of the case and in law, the Learned Income Tax Appellate Tribunal was correct in holding the identity and creditworthiness is established just because a list of such members of the Assessee Society is provided without PAN and KYC documents?

3. Whether on the facts and in the circumstances of the case and in law, the Learned Income Tax Appellate Tribunal was correct in holding that it was genuine transaction although it has been proved that such pigmy deposit and repayment of loan was immediately due to the Assessee Society, during the normal course of its business operations?

4. Whether on the facts and in the circumstances of the case and in law, the Learned Income Tax Appellate Tribunal was correct, without appreciating that whatever is illegal as per one law cannot be legal as per any other law as held by the Hon'ble Apex Court in Apex Laboratories Pvt. Ltd. 135 taxmann.com 286?

4. Copy of the circular dated 17.09.2024 of the Central

Board of Direct Taxes is enclosed. In the light of the

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subject matter of the appeal being below monetary limit in

terms of the Circular, the proceedings cannot be

continued. Learned counsel for the revenue submits that

he be granted liberty to revive the appeal in case the

matter falls within the exceptions under the aforesaid

Circular dated 17.09.2024 and Circular No. 5/2024

dated15.03.2024.

5. In view of the aforesaid submissions, the appeal is