MOHAMMED MUSTAFEEZUR RAHMAN,BANGALORE, KARNATAKA vs. THE INCOME TAX OFFICER, WARD - 1(1)(1), BANGALORE, BMTC BUILDING, KORAMANGALA, BANGALORE

IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH: BANGALORE BEFORE SHRI PRASHANT MAHARISHI, VICE – PRESIDENT AND SHRI KESHAV DUBEY, JUDICIAL MEMBER ITA Nos. 218 & 222/Bang/2026 Assessment Year : 2016-17

Mohammed Mustafeezur Rahman, The Income Tax Officer, 33, 4th Cross, Shivaji Road, Ward – 1(1)(1), Shivaji Nagar, Vs. Bengaluru. Bengaluru – 560 051. PAN : AHIPR9965Q APPELLANT RESPONDENT

: Sri Divyesh Chhatbar – ACA Assessee by Revenue by : Sri Subramanian S – JCIT DR

Date of Hearing : 07-05-2026 Date of Pronouncement : 20-07-2026

ORDER PER PRASHANT MAHARISHI, VICE – PRESIDENT

These two appeals, filed by Shri Mohammed Mustafizur Rahman, 1. proprietor of Phoenix Realtors (―the assessee‖), relate to Assessment Year 2016-17. Both are directed against the appellate orders dated 9 January 2026 passed by the National Faceless Appeal Centre, Delhi [learned CIT(A)]. The first appeal arises from the assessment order dated 24 March 2022 passed under sections 147 read with 144 and 144B of the Income-tax Act, 1961, against which the assessee filed an appeal on 15 November 2024. The second appeal arises from the penalty order dated 22 September 2022 passed under section 271(1)(c) of the Act, which was also dismissed by the learned CIT(A) by order dated 9 January 2026.

ITA Nos.218 & 222/Bang/2026 Page 2 of 5 2. As perinformation available with the Income Tax Department, the assesseehad received commission income of ₹50,09,431 during Assessment Year 2016-17. On verification of the e-filing portal, it was noticed that he had not filed hisreturn of income for that year. The case was therefore reopened by issuing a notice under section 148 of the Act on 31 March 2021. Subsequent notices under section 142(1) were also issued calling for information. Since the assessee did not respond, a show-cause noticewas issued, and the assessment was completed by orderdated 24 March 2022 determining histotal income at ₹50,09,431. 3. The assessee appealed before the learned CIT(A) against the assessment order, but the appeal was delayed. In Form No. 35, he explained that although the assessment and penalty orders were stated to have been served on the dates mentioned therein, they were sent to the email address registered on the e-filing portal, namely AshokSharma5522@email.com. That address belonged tohis former tax consultant, who had managedhis tax filings for several years but had passed away. Consequently, the assessee had no communication from that office and was unaware that the assessment order had been passed. He further stated that he did not havephysical copies of either the assessment or penalty order. Later, he engaged a chartered accountant, who was occupied with time-barring tax audit and return-filing work for Assessment Year 2024-25 during September and October 2025. The appealsbefore the learned CIT(A) were therefore filed with delays of 934 days in the quantum appeal and 752 days in the penalty appeal. 4. The learned CIT(A) noted that the assessment order, though passed on 24 March 2022,was appealedonly on 15 November 2024, resulting in a delay of 937 days. Seekingcondonation,the assessee stated that the order had not been received by him but by Mr. Ashok Sharma, his accountant, who had passed away a few years earlier due to cancer. The assessee therefore claimed that he was unaware of the assessment order and was not familiar with the procedural requirements under the Act. He also produced a medical certificate stating that he was suffering from acute bipolar disorder. He further stated that, after learning of the assessment order in September 2024, he engaged a chartered

ITA Nos.218 & 222/Bang/2026 Page 3 of 5 accountant, but the accountant’s time-barring tax audit and return-filing work caused further delay. The learned CIT(A) found the explanation unsatisfactory and dismissed the appeal without admitting it. 5. The assessee also appealed against the penalty levied under section 271(1)(c) by order dated 22 September 2022. That appeal was filed before the learned CIT(A) on 18 November 2025 with a delay of 755 days. For substantially the same reasons as in the quantum appeal, the learned CIT(A) refused to condone the delay and dismissed the penalty appeal without admitting it. 6. Thus, the learned CIT(A)dismissed both appeals at the threshold on the ground of delay—937 days in the quantum appeal and 755 days in the penalty appeal. Aggrieved, the assessee is now in appeal before the Tribunal. 7. The learned authorised representative filed paper books of 127 pages for the quantum appeal and 174 pages for the penalty appeal. He submitted that the assessee could not file the appeals within time for the reasons already placed before the learned CIT(A), and that the delay deserved to be condoned in the facts and circumstances of the case. 8. On merits, he submitted that the assessee is a resident individual carrying on real estate brokerage through his proprietorship concern, Phoenix Realtors. Although his taxable income exceeded the basic exemption limit, he had not filed a return. He had received commission income of ₹50,09,431 from various real estate companies, on which tax of ₹5,00,914 had been deducted at source. The notice under section 148 was issued to the email address of the assessee’s accountant, who had died of cancer; as a result, the assessee was unaware of the notices and could not comply. Similar non-compliance occurred with later notices issued by the Assessing Officer, leading to completion of assessment under section 144 read with section 147. He submitted that, if an opportunity is granted, the mattershould be restored for proper verification. He further contended that, out of the total receipts, only ₹28,14,050 was taxable in the assessee’s hands under section 28, resulting in an estimated tax liability of about ₹4,27,400 as against tax deducted at source of about ₹5,00,000. He also stated that the assessee

ITA Nos.218 & 222/Bang/2026 Page 4 of 5 could not appear before the Assessing Officer due to his medical condition, including bipolar disorder, and relied on the medical records in the paper book. 9. The learned Departmental Representative submitted that the appeals before the learned CIT(A) were hopelessly delayed and that the assessee had failed to show reasonable and sufficient cause for condonation. He therefore opposed restoration to the Assessing Officer. In the alternative, he submitted that, if the matters were to be restored, they should be remanded to the learned CIT(A), who had dismissed the appeals without admitting them on the ground of delay. 10. We have considered the rival submissions on the quantum addition and the penalty proceedings. The assessee’s appeals before the learned CIT(A) were delayed by 937 days in the quantum appeal and 755 days in the penalty appeal. His explanation is that the email address registered on the income-tax e-filing portal belonged to his earlier tax consultant, Mr. Ashok Sharma, who had handled his tax matters for several years but later passed away due to cancer. Thereafter, the assessee had no effective communication from that office and remained unaware of the assessment order. It was also stated that he suffered from bipolar disorder and that normal functioning was affected by the COVID-19 pandemic. The assessee came to know of the assessment order only when he logged into the portal to file his return for Assessment Year 2024-25 and noticed the outstanding demand for Assessment Year 2016- 17. He then contacted a chartered accountant and was advised to file appeals before the learned CIT(A). In our view, the delay was neither deliberate nor due to negligence; it arose becausethe assessee was unaware of the assessment and penalty orders following the death of his tax consultant. The same reasoning applies to the delay in the penalty appeal. We therefore hold that sufficient cause existed to condone the delay. 11. Accordingly, we set aside the orders of the learned CIT(A), condone the delay in both appeals, and restore the matters to the file of the learned CIT(A) for adjudication on merits. The assessee shall appear before the learned CIT(A) and comply with all notices issued during the appellate

ITA Nos.218 & 222/Bang/2026 Page 5 of 5 proceedings. The learned CIT(A) shall decide both appeals on merits after giving the assessee a reasonable opportunity of being heard. 12. In the result, both appeals are allowed for statistical purposes.

Order pronounced in the open court on 20th July, 2026.

Sd/- Sd/- (KESHAV DUBEY) (PRASHANT MAHARISHI) JUDICIAL MEMBER VICE-PRESIDENT Bangalore, Dated, the 20th July, 2026. Copy to: 1. Appellant 2. Respondent 3. CIT 4. DR, ITAT, Bangalore 5. CIT(A) By order

Assistant Registrar, ITAT, Bangalore