KILARI JAGANNATHAM SUWRESH BENGALURU vs INCOME TAX OFFICER WARD - 4(1)(3) BENGALURU

Headnote:(A) Income Tax Act, 1961 - Section 253(2) and (5) - Limitation Act, 1963 - Section 3 and 5 - Condonation of delay - Appeal to ITAT - Sufficient cause - The ITAT can condone delay only if sufficient cause for not presenting the appeal within time is shown; delay cannot be condoned on sympathetic grounds or by imposition of costs alone; courts have no power to extend limitation on equitable grounds; the phrase 'sufficient cause' cannot be liberally interpreted if negligence, inaction, or lack of bona fide is writ large. (Paras 9, 10, 11, 12, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25)

(B) Income Tax Act, 1961 - Section 153A - Search and assessment - Non-filing of return in response to notice under section 153A - Conduct of assessee in remaining unrepresented before lower authorities - Negligence. (Paras 16, 23)

(C) Condonation of delay - Reliance on coordinate bench order - The mere fact that another assessee received relief in a similar matter does not entitle the present assessee to the same benefit if the court is not satisfied with the cause shown; the coordinate bench's order did not refer to 'sufficient cause' and is not supported by Section 253(3) of the Act. (Paras 17, 18)

Facts of the case:
The assessees, directors of a car dealership company, filed belated appeals (delays of 861/870 days) against CIT(A) orders dated 23.3.2023/27.3.2023 that dismissed their appeals for non-prosecution. The assessees attributed the delay to an employee who allegedly withheld statutory notices and orders due to personal grievances. They filed a criminal complaint against the employee in March 2025 and filed the appeals in October 2025. The assessees also relied on a coordinate bench order in a related company's case where a similar delay was condoned with a nominal cost.

Findings of Court:
The ITAT held that the period from 23 March 2023 to 31 March 2025 was entirely unaccounted for, and no sufficient cause was shown. The employee's involvement in the assessees' tax matters was not established; the employee's duties were confined to administrative functions. The assessees' conduct of remaining unrepresented before the AO and CIT(A) showed negligence. The coordinate bench order did not mention 'sufficient cause' and could not be followed. The delay of 870 days could not be condoned, and all seven appeals were dismissed as unadmitted.

Issues: The main issue was whether the assessees had shown 'sufficient cause' for the 870-day delay in filing appeals before the ITAT under Section 253(5) of the Income Tax Act, 1961.

Ratio Decidendi: The court applied the Supreme Court's principles: law of limitation is based on public policy; delay condonation requires 'sufficient cause'; the discretion to condone delay is not to be exercised on equitable grounds or by imposing costs; negligence and inaction bar condonation; and the merits of the case are irrelevant at the condonation stage. The court found no sufficient cause as the entire delay period was unexplained, the employee's role was not proved, and the coordinate bench's order was not binding as it did not apply the correct legal test.

Result: All appeals are dismissed as unadmitted. Delay of 870 days not condoned.

Legal Category Hierarchy

1. Appeals filed with 870-day delay; condonation sought alleging employee misconduct. (Para 1 , 2 , 3 , 4 )

2. Assessee argued sufficient cause due to employee's actions; revenue contended no cause shown. (Para 6 , 7 )

3. Delay not condoned; appeals dismissed as unadmitted. (Para 24 )

4. What condition must be satisfied for condonation of delay under section 253(5) of the Income Tax Act?

The appellant must demonstrate 'sufficient cause' for the delay; no other factor can substitute for it. (Para 10 , 11 )

5. Can a liberal approach or justice-oriented approach override the law of limitation?

No. Liberal approach cannot be used to defeat the substantive law of limitation; sufficient cause must still be shown. (Para 12 , 18 , 21 )

6. Is negligence or lack of diligence a ground to refuse condonation?

Yes. If the party is negligent or did not act diligently, there is no justified ground to condone delay. (Para 15 , 16 , 22 , 23 )

7. Can condonation be granted merely because costs are imposed or because another assessee obtained relief?

No. Imposing costs does not substitute for sufficient cause; relief granted to others is not binding without proper cause. (Para 12 , 13 , 17 , 18 )

आदेश/ORDER

PER PRASHANT MAHARISHI, VICE PRESIDENT

1. ITA Nos. 2250 & 2251/BANG/2025 have been filed by Kilari Jagannatham Suwresh [The Assessee/ Appellant] for assessment years 2017-18 and 2020- 21, while ITA Nos. 2252 to 2254/BANG/2025 have been submitted by Kilari Lakshmi Suthaa[ The Assessee/ Appellant] for assessment years 2017-18, 2019-20, and 2020-21. These appeals are against the order of the Learned CIT(Appeals)-11, Bengaluru [Ld. CIT(A)] dated March 27, 2023. All appeals were filed belatedly with delays of 861 and 870 days before the ITAT.

2. The assessee has submitted an application seeking condonation of delay. The explanation provided is that the assessee received an order under section 250 of the Income Tax Act, 1961 ("the Act") dated 23.3.2023/27.3.2023, which dismissed the appeals for non-prosecution. Although the appeal ought to have been filed within sixty days from the date of receipt of this order, it was instead filed on 8.10.2025, resulting in a delay of 870 days.

3. The delay stated to be attributed to the fact that both the assessee and his spouse served as Directors of M/s. Lakshmi Car Zone Pvt. Ltd., which operates as a Nissan car dealership. During the financial years 2018-19 and 2019-20, the company encountered substantial losses and operational challenges, resulting in an inability to fulfil salary commitments. As a result, the majority of employees were terminated, and only essential personnel were retained. Statutory compliance responsibilities were delegated to Mr. Dilip K.S., and the assessee proceeded under the bona fide assumption that Mr. Dilip K.S. had managed all required compliance matters.

4. In March 2025, following consultation with new legal counsel regarding unrelated issues, the assessee became aware of several ex parte assessment and penalty orders. A subsequent inquiry determined that Mr. Dilip K.S. had deliberately withheld statutory notices and orders, failing to relay them to the appropriate professionals or Directors due to personal grievances. On 24 March 2025, the assessee filed a criminal complaint against Mr. Dilip K.S., who admitted to withholding statutory information during the police investigation. All supporting documentation was duly submitted. Mr. Dilip K.S. could not be located until September 2025. Efforts to retrieve statutory records and documents continued, resulting in the filing of the present appeals in October 2025, thereby accounting for the delay.

5. It is submitted that The delay is neither deliberate nor intentional but occurred due to the aforementioned circumstances. It is further noted that, in a similar case involving Lakshmi Car Zone Pvt. Ltd., the Coordinate Bench, by order dated 25.2.2026, condoned a comparable delay and remitted the matter to the learned Assessing Officer for fresh adjudication. The relevant order has been placed on record. Accordingly, it is respectfully requested that the delay of 870 days in filing the appeals be condoned.

6. Arguing all the appeals and also the condonation petitions filed by both these assesses, The learned Authorized Representative, Shri Hemant Pai, Advocate , strongly endorsed the arguments presented in the aforementioned petition and referenced the order issued by the Coordinate Bench on 25 February 2026 in the case of Lakshmi Car Zone Pvt. Ltd. Accordingly, he submitted that the delay warrants condonation.

7. Shri Shivananda H. Kalakeri, the learned CIT(DR), submitted that delays should only be condoned when the assessee establishes sufficient cause. Without such justification, condonation cannot be permitted. He observed that Mr. Dilip K.S. had no involvement in income tax matters, nor does the assessee assigned him responsibility for these issues; his duties were confined to administrative functions of that company. Shri Kalakeri also referred to Mr. Dilip K.S.'s statement dated 27.4.2025, as well as the order issued by the Coordinate Bench, which does not acknowledge ‘sufficient cause’ but rather imposes a nom

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2026 Supreme(Online)(ITAT) 11031

INCOME TAX APPELLATE TRIBUNAL (BANGALORE BENCH)
KILARI JAGANNATHAM SUWRESH BENGALURU – Appellant
Versus
INCOME TAX OFFICER WARD - 4(1)(3) BENGALURU – Respondent
ITA 2250/BANG/2025[2017 - 18]

Delay in filing an appeal before ITAT can be condoned only if 'sufficient cause' is shown; negligence, inaction, or lack of bona fide bars condonation, and imposition of costs cannot substitute for absence of sufficient cause.

Legal Category Hierarchy

Table of Contents

4. What condition must be satisfied for condonation of delay under section 253(5) of the Income Tax Act?

5. Can a liberal approach or justice-oriented approach override the law of limitation?

6. Is negligence or lack of diligence a ground to refuse condonation?

7. Can condonation be granted merely because costs are imposed or because another assessee obtained relief?

2026 Supreme(Online)(ITAT) 11031

INCOME TAX APPELLATE TRIBUNAL (BANGALORE BENCH)KILARI JAGANNATHAM SUWRESH BENGALURU – AppellantVersusINCOME TAX OFFICER WARD - 4(1)(3) BENGALURU – RespondentITA 2250/BANG/2025[2017 - 18]

Delay in filing an appeal before ITAT can be condoned only if 'sufficient cause' is shown; negligence, inaction, or lack of bona fide bars condonation, and imposition of costs cannot substitute for absence of sufficient cause.

Legal Category Hierarchy

Table of Contents

4. What condition must be satisfied for condonation of delay under section 253(5) of the Income Tax Act?

5. Can a liberal approach or justice-oriented approach override the law of limitation?

6. Is negligence or lack of diligence a ground to refuse condonation?

7. Can condonation be granted merely because costs are imposed or because another assessee obtained relief?

INCOME TAX APPELLATE TRIBUNAL (BANGALORE BENCH)
KILARI JAGANNATHAM SUWRESH BENGALURU – Appellant
Versus
INCOME TAX OFFICER WARD - 4(1)(3) BENGALURU – Respondent
ITA 2250/BANG/2025[2017 - 18]