BHAGYA,BANGALORE vs. INCOME TAX OFFICER, WARD-7(2)(3), BANGALORE

ITA 83/BANG/2026Status: DisposedITAT Bangalore22 September 2026AY 2018-195 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal condoned the delay of 457 days in filing the appeal, finding sufficient cause based on the assessee's explanation of health issues, personal difficulties, and transition in professional assistance, applying the principle of liberal construction of "sufficient cause" as laid down in Collector, Land Acquisition v. Mst. Katiji & Others. On merits, the Tribunal held that the deduction claimed by the assessee was denied primarily for want of supporting evidence. Since the documents now produced by the assessee could not be examined by the lower authorities, and there was also a dispute regarding whether the claim fell under Section 54 or Section 54F, the Tribunal restored the issue to the file of the AO for fresh examination. The AO was directed to examine the sale deed and other supporting documents to determine the applicability of Section 54 or Section 54F, and thereafter, examine the eligibility and quantum of deduction after giving the assessee a reasonable opportunity of being heard. The Tribunal explicitly stated that it had not expressed any opinion on the merits of the claim. The ground raised by the assessee was allowed for statistical purposes.

What were the facts?

The assessee, Bhagya, filed an appeal before the Income Tax Appellate Tribunal (ITAT) challenging the order of the Commissioner of Income Tax (Appeals) [CIT(A)] for Assessment Year 2018-19. The appeal was filed with a delay of 457 days, which the assessee sought to condone citing health issues, personal difficulties, and transition in professional assistance. The assessee sold an immovable property for Rs. 85 Lakh, earning a long-term capital gain (LTCG) of Rs. 58,94,890/-. The assessee claimed this entire LTCG as a deduction under Section 54F of the Income Tax Act, 1961. The Assessing Officer (AO) denied this deduction for want of evidence. The CIT(A) confirmed the AO's disallowance as the assessee did not respond to notices during appellate proceedings.

What were the issues?

1. Whether the delay of 457 days in filing the appeal before the Tribunal is liable to be condoned under Section 54F of the Income Tax Act, 1961, based on the "sufficient cause" principle. Assessee's Contention: The delay was due to health issues, personal difficulties, delay in obtaining necessary evidence, and a transition in professional assistance. The delay was neither intentional nor deliberate. Relied on Collector, Land Acquisition v. Mst. Katiji & Others [1987] 167 ITR 471 (SC). Revenue's Contention: The assessee failed to satisfactorily explain the delay, and the appeal should be dismissed as barred by limitation. 2. Whether the assessee is eligible for deduction under Section 54F (or Section 54) of the Income Tax Act, 1961, on the long-term capital gain arising from the sale of an immovable property, and if so, to what extent. Assessee's Contention: Necessary documentary evidence could not be filed earlier due to unavoidable hardship. The assessee is now ready with documents like sale/purchase deeds and prays for an opportunity to substantiate the claim before the AO. The claim is actually under Section 54 of the Act, not Section 54F, and should be examined accordingly. Revenue's Contention: Sufficient opportunities were granted to the assessee before the AO and CIT(A). The assessee failed to furnish necessary evidence and participate in proceedings, justifying the lower authorities' decisions based on available material.

Which sections of the Income-tax Act were involved?

Section 54F,Section 250,Section 54

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BANGALORE BENCHES, BANGALORE

Before: SHRI WASEEM AHMED & SHRI SANDEEP SINGH KARHAIL

For Respondent: Shri. Balusamy. H, JCIT

PER SHRI WASEEM AHMED, ACCOUNTANT MEMBER:

The present appeal filed by the assessee pertaining to A.Y. 2018-19 is directed against the order of the learned Commissioner of Income Tax (Appeals) (hereafter, the Ld. CIT(A)) u/s 250 of the Income Tax Act, 1961 (hereafter, the Act) vide order dated 09.08.2024. 2. At the outset, we note that the present appeal has been filed before the Tribunal with a delay of 457 days

The order continues below.

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