Ganganally Mallappa Basavaraju Vs ITO (ITAT Bangalore)
The ITAT Bangalore adopted a balanced approach—condoning delay with penalty while restoring the matter for fresh adjudication, emphasizing natural justice but not sparing negligent conduct.
The assessee’s case was reopened and a huge addition of ₹2.40 crore was made due to mismatch in income and non-response to notices. Even before CIT(A), the appeal was filed with 222 days delay and was dismissed in limine without merit adjudication.
Before the Tribunal, the assessee cited medical reasons for non-appearance. The ITAT noted that while there was lack of diligence, the CIT(A) ought not to have dismissed the appeal without passing a speaking order as mandated under Section 250(6).
Balancing both sides, the Tribunal:
- Condoned the delay, but
- Imposed cost of ₹20,000 (to PM Relief Fund) for negligence, and
- Remanded the matter to AO for de novo assessment, granting one final opportunity.
Consequently, since the quantum issue was restored, the penalty u/s 270A was held unsustainable and automatically set aside.
The ruling reinforces: natural justice prevails-but at a cost when the assessee is careless.
FULL TEXT OF THE ORDER OF ITAT BANGALORE
These appeals are filed by the assessee against the order of CIT(A) (NFAC, Delhi), vide DIN and Order No.ITBA/NFAC/S/250/2025-26/1082831787(1) dated 20.11.2025 for Assessment Year 2020-21, arising out of the order passed under section 147 r.w.s. 144 on 30.01.2025 and vide DIN and Order No.ITBA/PNL/F/270A/2025-26/1078827968(1) dated 26.11.2025 arising out of the penalty order passed under section 270A of the Act on 23.07.2025 respectively.
