SRINIVAS REDDY PRABHAKAR,BANGALORE vs. INCOME TAX OFFICER, WARD 3(2)(1), BANGALORE

ITA 1466/BANG/2026Status: DisposedITAT Bangalore23 September 2026AY 2022-234 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the delay in filing the appeal before the NFAC should be condoned. The Tribunal noted that the disallowance of expenses by the AO was an ad-hoc one and that the assessee had undertaken to produce the necessary details before the NFAC. Therefore, the Tribunal was inclined to condone the delay and directed the NFAC to decide the issue on merits after granting the assessee an opportunity of being heard. The Tribunal also directed the assessee to pay a cost of Rs. 5,000/- to the Prime Minister's National Relief Fund within four weeks. The issue regarding the disallowance of expenses was not decided on merits by the Tribunal, as the NFAC had dismissed the appeal on limitation.

What were the facts?

The assessee, Shri Srinivas Reddy Prabhakar, an individual engaged in the retail vending of liquor, filed his return of income for Assessment Year 2022-23. The Assessing Officer (AO) selected the case for scrutiny and disallowed 20% of the claimed expenses, deeming them personal. The assessee appealed to the NFAC (formerly CIT(A)), but the appeal was dismissed due to a delay of 370 days. The assessee attributed the delay to a lack of technical knowledge and professional guidance. The assessee then filed an appeal before the Income Tax Appellate Tribunal (ITAT) against the NFAC's order.

What were the issues?

1. Whether the delay of 370 days in filing the appeal before the NFAC should be condoned, considering the assessee's explanation of lack of technical knowledge and professional guidance? (Question of fact and law) Assessee's Contention: The assessee argued that the delay was due to a lack of technical knowledge, which prevented him from viewing communications, and sought an opportunity to present details before the NFAC. The assessee also contended that the AO's disallowance of expenses was not justified as they were business-related. Revenue's Contention: The revenue argued that the assessee had not provided valid reasons for the delay, and therefore, the NFAC was correct in dismissing the appeal.

Which sections of the Income-tax Act were involved?

Section 37(1)

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Income Tax Appellate Tribunal, BANGALORE BENCHES, BANGALORE

Before: SHRI PRASHANT MAHARISHI, VICE – & SHRI SOUNDARARAJAN K.

PER SHRI SOUNDARARAJAN K., JUDICIAL MEMBER:

This is an appeal filed by the assessee challenging the order of the NFAC, Delhi dated 09/01/2026 in respect of the A.Y. 2022-23. 2. The brief facts of the case are that the assessee is an individual engaged in the business of retail vending of liquor and filed his return of income. The case was selected for scrutiny and the AO had disallowed the 1 Shri Srinivas Reddy

The order continues below.

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