ITAT Condones 276-Day Delay Due to Paralysis, Orders Fresh Verification of Rs. 26.44 Lakh Addition

The case has been filed by a taxpayer named Lingannagari Pranitha in the Income Tax Appellate Tribunal (ITAT), Hyderabad, challenging an order dated June 06, 2025, passed by the CIT(A)/NFAC Delhi. The case is related to the assessment year 2017-18. The order had a confirmed addition made by the Assessing Officer (AO).

The current appeal was filed late, by 276 days in the tribunal. The assessee claimed that she was suffering from paralysis and was bedridden, hence could not timely file an appeal. In support of her claim, the assessee submitted her medical certificate. The tribunal noted the reason was genuine, hence condoned the delay, and accepted the appeal of the assessee relying on an earlier judgment of the Supreme Court in the case of Collector, Land Acquisition vs. MST Katiji.

In the year under consideration, the assessee did not file her income tax return (ITR). It was noticed by the tax department that the assessee had deposited Rs. 9.30 lakh in her bank account during the period of demonetization. The AO issued an SCN (Show Cause Notice) to the assessee. As she did not respond to the notice, AO completed the assessment by passing an ex parte order without hearing the assessee and made an addition of Rs. 26.44 lakh to the assessee’s income as unexplained money under section 69A of the Income Tax Act.

The aggrieved assessee filed an appeal before CIT(A); however, the assessee again did not cooperate with CIT(A) and respond to the multiple notices. As a result, the CIT(A) confirmed the addition made by AO. Thereafter, the assessee filed the current appeal in the ITAT Hyderabad.

Before the Tribunal, the assessee argued that the AO made several serious factual mistakes in the assessment. Further highlighted that AO had mistakenly taken total bank credits as Rs. 26.44 lakh, while the actual credit amount was just Rs. 18.19 lakh. Among this amount, also, Rs. 8.89 lakh was from a gold loan credited to the bank account, leaving only around Rs. 9.30 lakh as other deposits. Additionally, AO added the same amount twice, which led to double taxation. The assessee prayed to the AO to provide a second opportunity to explain her side properly and also apologised for the earlier non-compliance due to serious health issues.

When the tribunal heard the arguments of both sides, it noted that both the initial assessment completed by the AO and the first appeal before the CIT(A) were decided without the proper participation of the assessee. Since the assessee claimed genuine health issues and had now produced bank statements and explanations, the Tribunal felt that she should be given one more opportunity to explain her side, as per the principles of natural justice.

Accordingly, the tribunal quashed the impugned order passed by the CIT(A) and remanded the case to the AP for fresh verification. The AO has been directed to redo the assessment after giving the assessee a proper opportunity to be heard. The appeal was allowed for statistical purposes.