SANDEEP THAKUR,RISHIKESH vs. ITO, WARD 1(4)(1),, RISHIKESH

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ITA 218/DDN/2026Status: DisposedITAT Dehradun10 July 2026AY 2018-194 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the penalty proceedings under Section 270A were invalid because the AO did not specify the exact limb of Section 270A(9) under which the penalty was levied. This omission renders the penalty manifestly illegal.

What were the facts?

The assessee's claim under Section 80G was disallowed, and penalty proceedings under Section 270A were initiated. The assessee argued that the penalty was invalid as the Assessing Officer (AO) failed to specify the exact clause under Section 270A(9) of the Act.

What were the issues?

Whether penalty under Section 270A is valid if the specific limb of Section 270A(9) is not specified by the Assessing Officer.

Which sections of the Income-tax Act were involved?

Section 80G,Section 270A,Section 270A(9)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “DB” NEW DELHI

Before: SHRI ANUBHAV SHARMA & SHRI SANJAY AWASTHI

For Appellant: Shri Pankaj Goel, CA
For Respondent: Shri Amar Pal Singh, Sr. DR (VC)
Hearing: 24.06.2026

ITA No.218/DEL/2026 SANDEEP THAKUR, RISHIKESH

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “DB” NEW DELHI BEFORE SHRI ANUBHAV SHARMA, JUDICIAL MEMBER AND SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER ITA No.218/DDN/2026 Assessment Year: 2018-19 SANDEEP THAKUR, Vs. INCOME TAX OFFICER, Anita Thakur Niwas, 20 Footi, Income Tax Office, Near Durga Mandir, Shyampur, Ward 1(4)(1), Rishikesh 249204, Uttarakhand. IDPL Colony, Rishikesh 249202, PAN No. AIUPT7247A Uttarakhand. Appellant Respondent

Assessee by Shri Pankaj Goel, CA Revenue by Shri Amar Pal Singh, Sr. DR (VC)

Date of hearing: 24.06.2026 Pronouncement on 10.07.2026 O R D E R PER SANJAY AWASTHI, ACCOUNTANT MEMBER: 1. This appeal arises from order dated 27.02.2026, passed u/s 250 of the Income Tax Act, 1961 (hereafter as “the Act”), by Ld. NFAC. In this case, the claim of the assessee u/s 80G of the Act amounting to Rs.8,30,000/- was disallowed by the Ld. AO and thereafter penalty proceedings u/s 270A of the Act were initiated. Subsequently, the penalty was levied under this section as well.

ITA No.218/DEL/2026 SANDEEP THAKUR, RISHIKESH 1.1 The aggrieved assessee approached the Ld. CIT(A) with grievance on merits of the case as also the technical ground that the specific clause u/s 270A(9) of the Act to classify the case was not done by the Ld. AO, thereby rendering the whole exercise invalid in the eyes of law. The Ld. CIT(A) did not grant any relief and confirmed the action of Ld. AO.

1.2 The aggrieved assessee has approached the ITAT with as many as three grounds out of which the first ground challenges the fact that the Ld. AO has not mentioned the specific clause u/s 270A(9) of the Act to hold the assessee responsible for misreporting of income.

2.

Before us the Ld. AR placed certain relevant documents for our perusal and placed on record several orders of coordinate benches and the Hon’ble Delhi High Court to canvass the point that the default of the assessee has to be classified under one of the six limbs of the Section 270A(9) of the Act for it to be legally valid. The Delhi High Court case relied on is the case of Prem Brothers Infrastructure LLP reported in 142 taxmann.com 38. The Ld. AR demonstrated that the specific limb u/s 270A(9) of the Act was not mentioned by the Ld. AO.

2.1 The Ld. DR relied on the orders of the authorities below.

3.

We have considered the submissions and have gone through the documents before us, including the cases relied upon by the assessee. We find that the coordinate bench orders relied upon by the Ld. AR are

ITA No.218/DEL/2026 SANDEEP THAKUR, RISHIKESH directly on the point that a fatality is brought into penalty proceedings u/s 270A in case the exact limb of Section 270A(9) of the Act is not specified. In this regard, the relevant portion from the Hon’ble Delhi High Court’s order in the case of Prem Brothers Infrastructure (supra) deserves to be extracted: -

“6. This court in the case of Schneider Electric South East Asia (HQ) PTE Ltd. vs. Asstt. CIT, International Taxation [W.P. (C) No.5111 of 2022, dated 28.03.2022] observed as under: - “6. Having perused the impugned order dated 9th March, 2021, this Court if of the view that Respondents’ action of denying the benefit of immunity on the ground that the penalty was initiated under section 270A of the Act for misreporting of income is not only erroneous but also arbitrtrary and bereft of any reason as in the penalty notice the Respondents have failed to specify the limb – “underreporting” or “misreporting” of income, under which the penalty proceedings had been initiated. 7. This Court also finds that there is not even a whisper as to which limb of Section 270A of the Act is attracted andhow the ingredient of sub-section (9) of Section 270A is satisfied. In the absence of such particulars, the mere reference to the word “misreporting” by the Respondents in the assessment order to deny immunity from imposition of penalty and prosecution makes the impugned order manifestly arbitrary. 8. This court is of the opinion that the entire edifice of the assessment order framed by Respondent No.1 was actually voluntary computation of income filed by the Petitioner to buy peace and avoid litigation, which fact has been duly noted and accepted in the assessment order as well and consequently, there is no question of any misreporting. 9. This Court is further of the view that the impugned action of Respondent No.1 is contrary to the avowed Legislative intent of Section 270AA of the Act to encourage/incentivize a taxpayer to (i) fast-tract settlement of issue (ii) recover tax demand; and (iii) reduce protracted litigation. 10. Consequently, the impugned order dated 09th March, 2022 passed by Respondent No.1 under section 270AA(4) of the Act is set aside and Respondent No.1 is directed to grant immunity u/s 270AA of the Act to the Petitioner.” ……………………..

ITA No.218/DEL/2026 SANDEEP THAKUR, RISHIKESH

“8. This Court also finds that there is not even a whisper as to which limb of section 270A of the Act is attracted and how the ingredient of sub-section (9) of section 270A is satisfied. In the absence of such particulars, the mere reference to the word "misreporting" by the Respondents in the penalty order to deny immunity from imposition of penalty and prosecution makes the impugned order manifestly arbitrary.” Respectfully following this order, we hold that the impugned penalty is manifestly illegal and deserves to be struck down.

4.

In the result, appeal of the assessee is allowed.

Order pronounced in the open court on 10.07.2026

Sd/- Sd/- (ANUBHAV SHARMA) (SANJAY AWASTHI) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 10.07.2026 *Kavita Arora, Sr. P.S. Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI

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