ARIHANT VASTUNIRMAN PRIVATE LIMITED,RATNAGIRI vs. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE KOLHAPUR, KOLHAPUR

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ITA 80/PUN/2026Status: DisposedITAT Pune19 May 2026AY 2023-246 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that an order rejecting an application for immunity under Section 270AA is appealable, following a jurisdictional High Court decision. The matter was restored to the CIT(A) for adjudication on merits.

What were the facts?

The assessee applied for immunity from penalty under Section 270AA, which was rejected by the Assessing Officer for non-compliance with payment deadlines. The CIT(A) dismissed the assessee's appeal on the grounds that an order under Section 270AA is not appealable.

What were the issues?

Whether an order passed by the Assessing Officer rejecting an application for immunity under Section 270AA is appealable before the CIT(A).

Which sections of the Income-tax Act were involved?

Section 270AA,Section 246A,Section 270A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE

Before: SHRI R. K. PANDA & SHRI ASTHA CHANDRA

For Appellant: Shri Pramod S. Shingte
For Respondent: Shri R.Y. Balawade, Addl.CIT

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A”, PUNE BEFORE SHRI R. K. PANDA, VICE PRESIDENT AND SHRI ASTHA CHANDRA, JUDICIAL MEMBER

ITA No. 80/PUN/2026 Assessment Year : 2023-24 Arihant Vastunirman Private Deputy Commissioner of Limited, Income Tax, Office No.1, vs. Central Circle, Siddhivinayak Community Hall, Aayakar Bhavan, Shivaji Nagar, Trabai Park, 31, C/2, Ratnagiri, E-Ward, Kolhapur, Maharashtra-415612 Maharashtra-416003. PAN : AAKCA4408K (Appellant) (Respondent) Assessee by : Shri Pramod S. Shingte Department by : Shri R.Y. Balawade, Addl.CIT Date of Hearing : 06-05-2026 Date of Pronouncement : 19-05-2026 O R D E R PER R.K. PANDA, VP:

This appeal filed by the assessee is directed against the order dated 09-12-2025 of the Ld.CIT(A)-Pune-11 [Ld.CIT(A)], relating to assessment year 2023-24.

2.

The grounds raised by the assessee are as under: “1. On the facts and circumstances of the case and in law the CIT(A)-11, Pune erred in dismissing the appeal of the appellant against order u/s 270AA rejecting immunity from penalty in limine on the ground that no appeal lies against such order. 2. On the facts and circumstances of the case and in law the CIT(A) erred in not accepting the contention of the appellant that the Assessing Officer, Central Circle, Kolhapur (Hereinafter referred to as the A.O) has erred in rejecting its application u/s 270AA for immunity from penalty u/s 270A of Rs.3,80,358 on incorrect grounds. The appellant submits that, as detailed in the statement of facts, it is fully eligible for the immunity and hence rejection of its application u/s 270AA in Form 68 is incorrect. The appellant prays that the AO be directed to grant its application u/s 270AA.” 3. Facts of the case, in brief, are that the assessee is a domestic company and filed its return of income on 28-10-2023, declaring total

2 ITA No. 80/PUN/2026 income of Rs. 4,63,59,340/-. The return was processed by the CPC on 30-01-2024 accepting the retuned income. Subsequently, the case was selected for scrutiny under Computer Assisted Scrutiny Selection (CASS). The Assessing Officer completed the assessment u/s. 143(3) of the Act on 18-03-2025 determining the total income at Rs. 4,93,81,890/-, after making addition u/s. 41(1) of the Act. Simultaneously, penalty proceedings u/s. 270A(9)(a) of the Act were initiated vide show cause notice u/s. 274 r.w.s. 270A of the Act, dt. 18-03-2025. Subsequently, the Assessing Officer initiated penalty u/s. 270A(9)(a) to 270A(2) of the Act, vide rectification order u/s. 154 of the Act on 07-05-2025.

3.1. The assessee vide its submissions dt. 23-05-2025, made an application in form 68 for immunity u/s. 270AA of the Act and submitted that demand raised of Rs. 9,71,790/- was paid on 30-04-2025. Since the demand was not paid within thirty days as mentioned in the demand notice u/s. 156 of the Act dt. 18-03-2025, the Assessing Officer issued show cause notice to the assessee on 03-06-2025 for rejection of application for immunity u/s. 270AA of the Act. The assessee explained that provisions of section 270AA of the Act will be applicable to under reporting of income only. Hence, rectification order u/s. 154 r.w.s.143(3) of the Act was passed by the Assessing Officer on 07-05-2025. It was submitted that since the application u/s. 270AA of the Act has been made within thirty days from the rectification order, the assessee is entitled for immunity.

3.2. However, the Assessing Officer rejected the explanation given by the assessee holding that the assessee failed to fulfil one of the conditions mentioned u/s. 270AA(1) of the Act i.e., tax interest payable as per assessment order u/s. 143(3) of the Act, dt. 18-03-2025 and demand notice u/s. 156, dt. 18-03-2025 within the period of thirty days from the

3 ITA No. 80/PUN/2026 date of issue of notice. He accordingly rejected the application for immunity of penalty u/s. 270AA of the Act.

4.

In appeal, the Ld.CIT(A) dismissed the appeal filed by the assessee, by observing as under:

3.

As noted from the appeal Memo and submissions filed by the appellant, it is found that this appeal is filed against the order dated 20.06.2025 passed under section 270AA of the Act. During the course of hearing held on 08/12/2025, the authorized representative was specifically asked to state as to whether order under section 270AA of the Act is an appealable order before CIT(A) under section 246A of the Act. However, he could not state the specific clause or sub-section of sec. 246A of the Act which allows the appeal to be filed against the order passed under section 270AA of the Act. 4. As per sec. 246A(1) of the Act, any assessee aggrieved by any of the orders stated therein may appeal to the Commissioner (Appeals) but the said section does not prescribe that assessee may appeal against the order passed u/s.270AA of the Act. Further, as per sec. 270AA(5) of the Act, the order made u/s. 270AA(4) of the Act shall be final. Therefore, the present appeal against the order passed under section 270AA of the Act is not maintainable and hence rejected. 5. Aggrieved with such order of the Ld.CIT(A), the assessee is in appeal before the Tribunal.

6.

The Ld.Counsel for the assessee at the outset filed a copy of the decision of the Hon'ble Bombay High Court in the case of Haren Textiles (P.) Ltd. vs. PCIT reported in [2022] 284 Taxman 58 (Bombay) and submitted that the Hon'ble High Court in the said decision has held that the assessee can challenge an order passed by the Assessing Officer, rejecting its application made u/s. 270AA(1) of the Act. He accordingly submitted that since the Ld.CIT(A) has dismissed the appeal in limine, holding that the provisions of section 246(1) of the Act, does not prescribe the assessee’s appeal passed against the order u/s. 270AA of the Act, and therefore, the matter may be restored to the file of the Ld.CIT(A) with a direction to adjudicate the appeal by admitting the same.

7.

The Ld.DR on the other hand, while supporting the order of the Ld.CIT(A) fairly conceded that the issue stands decided in favour of the assessee by the decision of the Hon'ble jurisdictional High Court.

4 ITA No. 80/PUN/2026 8. We have heard the rival arguments made by both the sides and perused the material available on record. The only issue to be decided in the instant appeal is regarding the admissibility of the appeal before the Ld.CIT(A). We find that the Ld.CIT(A) in the instant case dismissed the appeal of the assessee against the order u/s. 270AA of the Act, rejecting the immunity from penalty in limine on the ground that no appeal lies against such order. However, we find the Hon'ble Bombay High Court while deciding somewhat similar issue has held that the assessee can challenge the order passed by the Assessing Officer, rejecting its application made u/s. 270AA(1) of the Act. The relevant observation of the Hon'ble Bombay High Court, reads as under:

“5. It will be useful to reproduce section 270(AA) of the Act, which reads as under: 270AA. (1) An assessee may make an application to the Assessing Officer to grant immunity from imposition of penalty under section 270A and initiation of proceedings under section 276C or Section 276CC, if he fulfils the following conditions, namely:- (a) the tax and interest payable as per the order of assessment or reassessment under sub-section (3) of section 143 or section 147, as the case may be, has been paid within the period specified in such notice of demand; and (b) no appeal against the order referred to in clause (a) has been filed. (2) An application referred to in sub-section (1) shall be made within one month from the end of the month in which the order referred to in clause (a) of sub-section (1) has been received and shall be made in such form and verified in such manner as may be prescribed. (3) The Assessing Officer shall, subject to fulfilment of the conditions specified in sub-section (1) and after the expiry of the period of filing the appeal as specified in clause (b) of sub-section (2) of section 249, grant immunity from imposition of penalty under section 270A and initiation of proceedings under section 276C or section 276CC, where the proceedings for penalty under section 270A has not been initiated under the circumstances referred to in sub-section (9) of the said section 270A. (4) The Assessing Officer shall, within a period of one month from the end of the month in which the application under sub-section (1) is received, pass an order accepting or rejecting such application: Provided that no order rejecting the application shall be passed unless the assessee has been given an opportunity of being heard. (5) The order made under sub-section (4) shall be final. (6) No appeal under section 246A or an application for revision under section 264 shall be admissible against the order of assessment or reassessment, referred to in clause (a) of sub-section (1), in a case where an order under sub-section (4) has been made accepting the application.

5 ITA No. 80/PUN/2026 6. Under sub-section 6 of section 270AA, no appeal under section 246(A) or an application for revision under section 264 shall be admissible against the order of assessment or reassessment referred to in clause (a) of sub-section 1, in a case where an order under sub-section 4 has been made accepting the application. This only means that when an assessee makes an application under sub-section 1 of section 270AA and such an application has been accepted under sub-section 4 of section 270AA, the assessee cannot file an appeal under section 246(A) or an application for revision under section 264 against the order of assessment or reassessment passed under sub-section 3 of section 143 or section 147. This does not provide for any bar or prohibition against the assessee challenging an order passed by the Assessing Officer, rejecting its application made under sub-section 1 of section 270AA. The application before Respondent No. 1 was an order challenging an order of rejection passed by Respondent No. 2 of an application filed by Petitioner under sub-section 1 of section 270AA seeking grant of immunity from imposition of penalty and initiation of proceedings under sub-section 276(C) or section 277(CC). 7. Therefore, in our view, Respondent No. 1 was not correct in rejecting the application on the ground that there is a bar under sub-section 6 of section 270(AA) in filing such application. The impugned order has to be set aside and it is hereby set aside. 8. The matter is remanded back to Respondent No. 1 to consider de novo, the application filed by Petitioner under section 264 impugning the order passed by the Assessing Officer under sub-section 4 of section 270AA and pass such orders as he deems fit in accordance with law after granting personal hearing to Petitioner. If Respondent No. 1 requires any further documents to be submitted by Petitioner, he shall cause to be served a communication upon Petitioner atleast one week before the date fixed for personal hearing.”

9.

Respectfully following the said decision of the jurisdictional High Court cited supra, we restore the issue to the file of the Ld.CIT(A) with a direction to admit the appeal and decide the same on merit and as per fact and law, after giving due opportunity of being heard to the assessee. We hold and direct accordingly. The grounds raised by the assessee are accordingly allowed for statistical purposes.

10.

In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 19th May, 2026

Sd/- Sd/- (ASTHA CHANDRA) (R. K. PANDA) JUDICIAL MEMBER VICE PRESIDENT पुणे/Pune; दिन ांक/Dated : 19-05-2026 TNMM

6 ITA No. 80/PUN/2026 आदेश की प्रतितिति अग्रेतिि/Copy of the Order is forwarded to: 1. अपील र्थी / The Appellant 2. प्रत्यर्थी / The Respondent 3. The concerned Pr.CIT, Pune 4. DR, ITAT, ‘A’ Bench, Pune 5. ग र्ड फ ईल / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Assistant Registrar आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune

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