DD585 BODIKAMMANVADI PRIMARY AGRICULTURAL COOPERATIVE CREDIT SOCIETY,DINDIGUL vs. INCOME TAX OFFICER, DINDIGUL

ITA 3172/CHNY/2026Status: DisposedITAT Chennai05 October 2026AY 2019-20206 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the Ld. CIT(A) erred by adjudicating an issue relating to penalty under section 271A of the Act, which pertains to failure to keep and maintain books of account, when the appeal before him concerned a penalty under section 270A, dealing with under-reporting and misreporting of income. These provisions operate in different fields with distinct requirements. Consequently, the CIT(A)'s order did not effectively adjudicate the appeal against the section 270A penalty. Furthermore, the Tribunal noted that the quantum addition of Rs.70,24,014/-, which formed the basis for the section 270A penalty, had been set aside by the CIT(A) in quantum proceedings and restored to the AO for fresh adjudication. Since the ultimate quantum of income was yet to be determined, sustaining the impugned penalty on the original determination was inappropriate. Therefore, in the interest of justice, the Tribunal set aside the impugned order of the Ld. CIT(A) and restored the issue relating to penalty under section 270A to the file of the AO for fresh adjudication after the consequential quantum proceedings are completed. The AO was directed to examine the applicability of section 270A afresh based on the ultimately determined income, providing the assessee with an opportunity of being heard. The Tribunal explicitly stated that it had not expressed any opinion on the merits of the penalty and left all contentions open for the AO to consider.

What were the facts?

The assessee, DD585 Bodikammanvadi Primary Agricultural Cooperative Credit Society, filed an appeal before the Income Tax Appellate Tribunal (ITAT) challenging an order dated 24.02.2026 passed by the Learned Commissioner of Income Tax (Appeals) [CIT(A)]. This order arose from a penalty order dated 18.07.2024 passed by the Assessing Officer (AO) under section 270A of the Income Tax Act, 1961, levying a penalty of Rs.43,76,742/-. The assessee contended that the CIT(A) failed to adjudicate the appeal concerning the penalty under section 270A and instead dealt with penalty under section 271A. Furthermore, the assessee argued that the quantum addition of Rs.70,24,014/-, which formed the basis for the section 270A penalty, had been set aside by the CIT(A) in quantum proceedings and restored to the AO for fresh adjudication.

What were the issues?

1. Whether the impugned order of the Ld. CIT(A) has adjudicated the appeal which was actually before him, specifically concerning the penalty under section 270A of the Income Tax Act, 1961? (Question of law and fact) 2. Whether the penalty under section 270A of the Income Tax Act, 1961, can be sustained when the quantum addition forming its basis has been set aside and restored to the AO for fresh adjudication? (Question of law and fact) Assessee's contentions: - The Ld. CIT(A) erroneously adjudicated an issue relating to penalty under section 271A of the Act instead of the penalty under section 270A. - The quantum addition of Rs.70,24,014/-, which was the basis for the section 270A penalty, has been set aside by the Ld. CIT(A) in quantum proceedings and restored to the AO for fresh adjudication. Revenue's contentions: - No arguments were recorded for the respondent (Revenue) in the judgment.

Which sections of the Income-tax Act were involved?

Section 270A,Section 271A,Section 44AA

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘D’ BENCH: CHENNAI

Before: GAGAN GOYAL & SHRI MANU KUMAR GIRI

Hearing: 21.09.2026

PER MANU KUMAR GIRI, JM:

This appeal by the assessee is directed against the order dated 24.02.2026 passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [“Ld. CIT(A)”], arising from the penalty order dated 18.07.2024 passed by the Assessing Officer [“AO”] under section 270A of the Income Tax Act, 1961 [“the Act”], whereby penalty of Rs.43,76,742/- was levied on the assessee.

The order continues below.

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