FAIZ ALA FAIZI,BANGALORE vs. I.T.O., WARD - 54(2), KOLKATA

ITA 1374/KOL/2026Status: DisposedITAT Kolkata30 September 2026AY 2017-20185 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the assessee's case was covered by the exception carved in Clause (a) to Section 270A(6) of the Income Tax Act, 1961. The Tribunal noted that the medical hardship suffered by the appellant was accepted as a reasonable cause for not filing the return within the due date, as evidenced by the cancellation of the penalty under section 271F. The assessee had also satisfactorily discharged their obligations by paying differential tax and interest and filing the return in response to the notice under section 148. The Tribunal observed that the assessee's income was substantially covered by TDS, the assessment was completed without any variation, and no contumacious conduct was brought on record. The explanation offered by the assessee was considered bona fide. Therefore, the Tribunal directed the Assessing Officer to cancel the impugned penalty under section 270A. As the penalty was cancelled in toto, the ground regarding excess penalty levied became irrelevant. The appeal of the assessee was allowed.

What were the facts?

The assessee, Faiz Ala Faizi, an individual and salaried employee, failed to file his return of income for AY 2017-18 due to a medical condition (epilepsy). A notice under section 148 was issued, in response to which the assessee filed a return declaring a total income of Rs. 24,53,130 and paid taxes and interest. The Assessing Officer completed the assessment without any additions or variations. The Assessing Officer initiated penalty proceedings under sections 271F and 270A. The penalty of Rs. 5,000 under section 271F was cancelled by the Ld. CIT(A) on the grounds of reasonable cause. However, the penalty of Rs. 3,67,969 under section 270A was confirmed by the Ld. CIT(A). The assessee appealed against the confirmation of the penalty under section 270A.

What were the issues?

1. Whether the penalty levied under section 270A of the Income Tax Act, 1961, is sustainable when the assessee's under-reported income was due to a bona fide explanation supported by material facts, falling under the exception provided in section 270A(6)(a)? Assessee's Contention: The assessee argued that the Ld. CIT(A) erred in confirming the penalty under section 270A. The assessee contended that their case falls under the exception provided in section 270A(6)(a), as the under-reported income was offered with a bona fide explanation, and all material facts were disclosed. The assessee highlighted that the same medical hardship which led to the deletion of penalty under section 271F was not considered for section 270A, leading to inconsistency. Furthermore, the assessee argued that no concealment, inaccurate particulars, or additions/disallowances were made, making the penalty unsustainable. Reliance was placed on decisions from Jaipur, Mumbai, Chennai, and Ahmedabad benches of the ITAT. Revenue's Contention: The Ld. DR relied on the orders of both the lower authorities.

Which sections of the Income-tax Act were involved?

Section 270A,Section 271F,Section 139,Section 148,Section 273B,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH: KOLKATA

Before: Shri George Mathan & Shri Gopalan Gurusamy

Per Gopalan Gurusamy, AM: This is an appeal preferred by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals)-NFAC, Delhi (hereinafter referred to as the “Ld. CIT(A)”] passed u/s 250 of the Act dated 26.02.2026 in appeal no. NFAC/2016-17/10498311 for the AY 2017-18. 2 Assessment Year: 2017-18 Faiz Ala Faizi

2.

The above appeal is against the levy of penalty u/s 270A by the Assessing Officer vide his order dated 14.05.2025 of an amount of Rs. 3,67,969/- and which has been confirmed by the Ld. CIT(A) vide his order dated 26.02.2026. 3. Before us, the Ld. AR represented that the assessee is an i

The order continues below.

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