A possible take on Karan's emotions:
Monami has always been someone who pushed him out of his comfort zone. She is someone who had never stopped to challenge him (something that most don't because of his intimidating aura, even people close to him like Faizi), someone who had forced him to come out of his reclusiveness, someone who has encouraged him to go on and talk to people.
He respected her skills as a doctor and her stand to do what was her duty (seen especially during the organ trafficking mission when she refused to leave Gauri to die).
After their conversation in the hospital when Karan apologizes for shooting her, and Monami telling him that she understood that it was an accident, he had developed respect for her as a person, which only grew when the judgement of her being just a spoiled, rich privileged kid was removed, and he saw her struggles.
She was special to him, and he could tell he was special to her and the two had a relationship he didn't name- something consisting of mutual admiration and respect. They weren't friends but they were more than just cadet and trainer. But it was easier for him to brush his care for her as a sense of duty to his cadet rather than him being introspective about his feelings for her.
When he hurt her by naming their relationship as 'cadet-trainer', he was confused and forced to introspect. He might still be unsure about his feelings for Monami (whether she was a friend because the feelings he shared for her were different from the ones he shared for Faizi and Sanju). He eventually settled on it giving it a name as 'friends' although their relationship was clearly not one of friendship.
He does things for her that he probably didn't do for anyone. He went shopping with her doing her 'close your eyes' trick, because she wanted him to. He didn't reprimand him for hugging her (outside Abhay's house) and only eased her awkwardness. He comforted her (in the restaurant), and when someone else wanted to dance with her, it irked him. He didn't push her away when she was too close to him (during the wish scene). He danced with her during Koel's success party, even though he hated dancing, just because she wanted him to.
Her closeness wasn't something he hated, and he enjoyed their relationship. But when Monami confessed, the suddenness and unexpectedness scared him, and he pushed her away instinctively, closing himself off. It was too big of a leap for him, and he couldn't accept it. But he hated hurting her as well, and he came to the conclusion that perhaps if he apologized for his rudeness, and explained his emotions, their relationship might as well get back to the way it was before.
Monami pushing him away doesn't just frustrate and sadden him because he hated hurting her, it was also, perhaps, because he was missing her, and missing their relationship.
When she ignored him and went to Faizi to ask about Sid (during Mission Jalpari), he might have thought about how she used to go to him when talking about problems, like with Koel, or even during the organ trafficking mission. When she was angry about him for sending Sid on a dangerous mission, it reminded him of how she had taken a stand for her during his enquiry and said he really did care about his cadets, and how she took a stand for him again during the Koel track and told the cadets that she trusted him.
While he reasoned with himself that he did a lot of things for her out of guilt (like standing up to her father), would it really be the same if it had been Sid in place of Monami?
Karan might be in love with her too, and doesn't want to acknowledge it. He had already admitted it that he couldn't handle people's love, and obviously, wouldn't be so accepting about he himself loving someone. His feelings might really stem out of guilt, and it might be coming from a place of love which he reasoned with himself as guilt.