The Calcutta High Court has dismissed an income tax appeal challenging the Income Tax Appellate Tribunal’s refusal to condone a delay, holding that an assessee invoking Section 260A of the Income Tax Act, 1961 must independently satisfy the mandatory requirement of raising a substantial question of law.
The Bench of Justice Rajarshi Bharadwaj and Justice Uday Kumar has observed that even where the Tribunal’s approach to condonation of delay may appear rigid, the High Court cannot admit an appeal under Section 260A merely on considerations of sympathy or because the Tribunal’s order appears harsh.
The assessee was carrying on business through a proprietorship concern, “Singh Construction”, in Purulia. For AY 2018–19, he filed his income tax return declaring total income of ₹6,51,020.
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During scrutiny proceedings, the Assessing Officer examined a property transaction dated November 23, 2017. The assessee had purchased the immovable property for a consideration of ₹10 lakh. However, instead of accepting the actual purchase consideration, the Assessing Officer adopted the stamp duty valuation of ₹39.69 lakh, determined by the Additional District Sub-Registrar, Purulia.
Relying upon the deeming provision under Section 56(2) of the Income Tax Act, the Assessing Officer consequently made an addition of ₹29.69 lakh to the assessee’s income. The assessment order was passed on March 8, 2021.
The assessee challenged the assessment before the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi. However, the first appeal was dismissed on August 26, 2024.
The assessee thereafter sought to approach the Income Tax Appellate Tribunal, Kolkata. However, the appeal before the Tribunal was filed belatedly.
The assessee attributed the delay to persistent physical health problems and chronic ailments affecting his arm. In support of his explanation, he produced medical certificates and an affidavit and sought condonation of the delay.
The ITAT, however, rejected the request for condonation by order dated January 13, 2026, in ITA No. 1766/KOL/2025. The Tribunal took the view that the medical circumstances cited by the assessee did not adequately explain the delay and specifically noted that the assessee had not suffered a sudden accident.
Consequently, the Tribunal refused to condone the delay and dismissed the appeal in limine, without examining the substantive tax dispute.
The assessee then approached the Calcutta High Court under Section 260A of the Income Tax Act.
The High Court, however, focused primarily on whether the appeal itself satisfied the statutory threshold for invoking its jurisdiction. The Bench emphasised that an appeal under Section 260A is maintainable only where the case gives rise to a substantial question of law.
The Court explained that Section 260A does not provide the High Court with the jurisdiction of a regular first or second appellate court. It cannot ordinarily re-appreciate evidence, reassess factual findings or undertake a fresh examination of factual disputes merely because a Tribunal order appears harsh.
According to the Court, even if the Tribunal’s approach to condonation of delay could arguably be regarded as “overly pedantic and rigid”, that circumstance by itself could not overcome the statutory requirement under Section 260A.
The Court identified the principal issues raised by the assessee. These included whether the Tribunal had wrongly disbelieved the medical certificates concerning his physical ailments and whether the authorities were justified in adopting the stamp duty valuation instead of the actual purchase price under Section 56(2).
The Bench held that both issues were essentially factual.
The question of whether sufficient cause existed for condoning the delay, the assessment of medical evidence and the factual determination concerning the valuation of the property did not, in the Court’s view, involve interpretation of a statutory provision or any conflict concerning the meaning of law.
The Court observed that such factual disputes do not automatically become substantial questions of law merely because an assessee disagrees with the Tribunal’s findings.
The High Court reiterated that a question proposed under Section 260A must satisfy the legal threshold of being debatable, novel and directly connected with the interpretation or application of a statutory provision.
Since the questions raised by the assessee essentially sought a re-appraisal of factual matters, the Bench concluded that they did not qualify as substantial questions of law.
This distinction was central to the dismissal. The High Court did not decide the underlying factual controversy over whether the medical reasons were sufficient or whether the stamp valuation was correctly adopted on merits. Instead, it held that those matters could not provide a jurisdictional foundation for an appeal under Section 260A.
The Court also dealt with the relevance of monetary-limit circulars issued by the Central Board of Direct Taxes under Section 268A.
It clarified that such administrative instructions concerning monetary limits operate as restrictions on the Revenue’s litigation, but they do not confer an independent right upon an assessee to maintain an appeal before the High Court.
In other words, the tax-effect threshold applicable to the Department cannot be treated as eliminating the separate statutory requirement that an assessee’s appeal under Section 260A must raise a substantial question of law.
The Court therefore drew a clear distinction between monetary-limit restrictions applicable to the Revenue and the jurisdictional requirement of a substantial question of law applicable to every appellant invoking Section 260A.
The Court held the appeal to be non-maintainable for want of any substantial question of law and left the Tribunal’s order undisturbed on that jurisdictional ground. There was no order as to costs.
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