MANOJ BANSAL,BHIWANI vs. INCOME TAX OFFICER WARD 1 BHIWANI, BHIWANI

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: ‘B’ NEW DELHI BEFORE MS. MADHUMITA ROY, JUDICIAL MEMBER AND SH. KRINWANT SAHAY, ACCOUNTANT MEMBER

I.T.A. No.9095/DEL/2025 (A.Y 2019-20) Manoj Bansal ITO Ward-1 48A, Industrial Area Vs. Bhiwani Sector-21 Bhiwani, Bhiwani PAN NO. AIZPK2387B Appellant by: Sh. Deepam Jain, Advocate Respondent by : Sh. Rajesh Kumar Dhanesta, Sr. DR Date of Hearing 24.06.2026 Date of Pronouncement 10.07.2026

ORDER PER KRINWANT SAHAY AM Appeal in this case has been filed by the assessee against the order dated 23.10.2025 passed by the Ld. CIT(A)/NFAC, Delhi for the A.Y. 2019-20. Grounds of appeal are as under :-

Enterprises and the income was enhanced only to buy peace of mind, without any adverse finding; hence the penalty is bad in law. 2. That the penalty proceedings u/s 270A are mechanical and invalid as the Ld. AO failed to specify the applicable sub-clause of section 270A(9) either in the reassessment order or in the penalty notice, rendering the proceedings void ab initio. 3. That the Ld. AO erred in imposing penalty u/s 270A even though no addition or disallowance was made in the reassessment order and the returned income was accepted in full, thereby rendering the penalty as unjustified and unsustainable in law. 4. That the impugned penalty order u/s 270A had been passed in absence of any proper and valid approval of Ld. Joint Commissioner which is in violation of Section 274, hence, void ab initio. 5. That the Ld. AO and the Ld. CIT(A) failed to appreciate that income voluntarily offered in the return filed in response to notice under section 148 and accepted without any addition does not constitute under-reported income; hence penalty u/s 270A is not leviable. 6. That the Ld. CIT(A) erred in holding that the case falls u/s 270A(9) (c) despite the absence of any adverse finding or disallowance and without such charge being specified in the notice, rendering the finding erroneous and unsustainable.

“1. That the appellant, is an individual who originally filed its return of income for AY 2019-20 declaring income of Rs. 24,25,270/- u/s 139. 2. Thereafter, re-assessment proceedings u/s 147 were initiated alleging purchases made from M/s Kumar Enterprises of Rs. 22,99,159/- as fictitious particularly

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when the appellant had not made any purchases from the alleged person. 3. Despite of this fact, merely to buy peace of mind, the appellant disallowed its genuine purchases with the alleged amount of Rs. 22,19,159/- and declared enhanced income of Rs. 47,24,429/- in the return filed u/s 148. 4. Thereafter, the returned income filed u/s 148 was accepted as such in toto without making any addition but mechanically initiated penalty proceedings u/s 270A by issuing notice u/s 270A alleging under-reporting of income in consequence of misreporting of income but no specific sub clause of section 270A(9) was either mentioned in the assessment order nor under the penalty notice issued u/s 270A. (Kindly refer to Page No. 48 for assessment order and Page No. 50 for notice issued u/s 270A.)

bothered to mention the specific sub-clause under which the assessee's case falls. The provisions of Section 270A(9) of the Act clearly define misreporting of income and hence, the Ld. AO is duty bound to clearly mention in the show cause notice itself as to which of the sub clauses in sub section (9) get attracted in the present case. Hence, it can be safely concluded that the show cause notice issued by the Ld. AO is very vague.

Hence, in view of the above, the notice issued u/s 270A without specifying the limb or sub clause of section 270A(9) in the present case, is vague and invalid which rendered the initiation of the penalty proceedings as vitiated under the law, consequent to which the penalty order passed by the Ld. AO needs to be quashed.”

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“6. I have given my thoughtful consideration to the vehement rival stands and find no merit in the Revenue's arguments. It is made clear that the assessee's case law indeed relates to the earlier penalty provision i.e., sec.271(1)(c) of the Act only wherein various hon'ble higher judicial forums had settled the law that the Assessing Officer ought to specify as to whether the concerned taxpayer had concealed or furnished inaccurate particulars of his taxable income during the course of assessment. I am of the view that the very line of judicial precedents would squarely apply even for the amended penalty provision i.e., sec.270A of the Act as well wherein the legislature has not only prescribed twin limbs of "under reporting of income as well as misreporting of income", but also, unlike the earlier provision u/sec.271, this time it has stipulated specific deeming illustrations under both the twin foregoing heads of the "under reported income" 5. We have considered the findings given by the authorities below on this issue and we have also considered the written submissions and arguments made by Ld. Counsel for the assessee. It is clear from very judicial pronouncements of both coordinate Benches and of higher judicial authorities that it is mandatory for the AO to point out and mention the specific such clause under which the assessee’s case falls for levy of penalty u/s.270A and for which show cause notice u/s.274 r.w.s. 270A of the Act is issued. The provisions of section 270A (ix) of the Act clearly defines misreporting of income but here in this case issued by the AO, it is silent on this issue. As it has been brought on record by the Ld. Counsel for the assessee that unless the AO specially mentions in the show cause notices issued u/s.274 r.w.s. 270A of the Act under which such clause the assessee 5 | P a g e

case falls unless its done by the AO. The notice issued by the AO and the penalty order passed cannot be sustained.

Order pronounced in open Court on 10 July, 2026.

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Sd/- Sd/- (MADHUMITA ROY) (KRINWANT SAHAY) JUDICIAL MEMBER ACCOUNTANT MEMBR Dated : 10/07/2026 *Neha Sr. PS*

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