ITAT grants property seller fresh hearing in ₹90.09 lakh tax penalty case

Background A property seller in India was assessed a penalty of **₹90.09 lakh** after the income‑tax department determined that the seller had not filed the required income‑tax return (ITR). Under the Income Tax Act, non‑filing can attract a penalty of up to 200% of the tax due, subject to the department’s assessment.

ITAT’s intervention The seller appealed the penalty, but the appeal was initially dismissed on procedural grounds because it was filed after the statutory deadline. The seller then approached the **Income Tax Appellate Tribunal (ITAT)**, seeking condonation of the delay. The tribunal accepted the explanation for the missed deadline, **condoned the delay**, and directed that the matter be **re‑considered afresh**.

Importantly, the ITAT **did not overturn the penalty** nor did it resolve the substantive tax dispute. The penalty remains in force while the fresh review proceeds.

Implications for the taxpayer The tribunal’s order gives the seller a second chance to present arguments on the merits of the penalty, such as any reasonable cause for non‑filing or errors in the department’s assessment. However, the penalty amount stays on the books until the new hearing concludes.

Next steps The case will now be re‑examined by the ITAT. The seller can submit additional evidence, challenge the calculation of the penalty, or argue for mitigation. The tribunal’s final decision will determine whether the ₹90.09 lakh penalty is upheld, reduced, or cancelled.

Wider relevance The ruling underscores that taxpayers who miss appeal deadlines can still obtain relief if they can demonstrate sufficient cause for the delay. It also signals that the ITAT may separate procedural relief from substantive adjudication, allowing both issues to be addressed independently.