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Facts
The assessee sold an immovable property for Rs. 80,00,000/- but did not file a return of income for AY 2018-19. The case was reopened, and the assessee eventually filed a return declaring Rs. 24,70,490/- income, which was accepted in assessment. However, the AO initiated penalty proceedings u/s 270A for under-reporting and misreporting of income.
Held
The Tribunal held that the penalty levied u/s 270A is not sustainable in law because the AO's penalty notice did not specify the relevant limb of section 270A(9) under which the penalty was being imposed. Following previous decisions in similar cases, the Tribunal quashed the penalty.
Key Issues
Whether the penalty under Section 270A for under-reporting and misreporting of income is leviable when the penalty notice fails to specify the relevant limb of Section 270A(9).
Sections Cited
147, 148, 144B, 270A, 270A(2), 270A(3), 270A(6), 270A(7), 270A(8), 270A(9), 143(3), 115JB, 115JC, 274
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Income Tax Appellate Tribunal, “B” BENCH, PUNE
Before: SHRI R.K. PANDA & MS. ASTHA CHANDRA
आदेश / ORDER
PER ASTHA CHANDRA, JM :
The appeal filed by the assessee is directed against the order dated 26.09.2024 of the Ld. Commissioner of Income Tax (Appeals)/NFAC, Delhi [“CIT(A)/NFAC”] pertaining to Assessment Year (“AY”) 2018-19.
There is a delay of 44 days in filing of this appeal before the Tribunal for which the assessee has filed an affidavit explaining the reasons for such delay. After hearing both the sides, we are of the view that the delay is attributable to the sufficient cause. We, therefore, in light of the decisions of the Hon'ble Supreme Court in the case of Collector, Land Acquisition vs. Mst. Katiji & Ors. (1987) 167 ITR 471 (SC) and in the case of Inder Singh Vs. The State of Madhya Pradesh reported in 2025 LiveLaw (SC) 339, condone the said delay and proceed to decide the appeal.
Briefly stated, the facts of the case are that the assessee is an individual and engaged in family business of agriculture. For A.Y. 2018- 19, the assessee did not file his return of income. The case of the assessee was reopened u/s 147 of the Income Tax Act, 1961 (the “Act”) by issue of notice u/s 148 on account of the sale of immovable property worth Rs. 80,00,000/- In response to the notice u/s 148 of the Act, the assessee filed his return of income on 26.04.2022 declaring total income of Rs. 24,70,490/- After verifying information through documents filed by the assessee during the assessment proceedings, the Ld. Assessing Officer (“AO”) completed the assessment on 01.03.2023 u/s 147 r.w.s 144B of the Act assessing total income at Rs. 24,70,490/- thereby accepting the income returned by the assessee without making any addition thereto. The Ld. AO however initiated penalty proceedings u/s 270A of the Act for under reporting of income in consequence of mis- reporting of income. During the penalty proceedings, the submissions/reply filed by assessee were found to be not tenable by the Ld. AO and he proceeded to pass the penalty order u/s 270A on 11.09.2023, levying penalty of Rs. 9,14,842/- @ of 200% of the tax sought to be evaded, by observing as under:- 3.7.1. As discussed in para 3.5 of this penalty order, it can be conclusively and safely said that this is a fit case to levy penalty u/s. 270Aof the Act for under reporting of income in consequence of miss-reporting of income for the year under consideration. 3.7.2 Further, it is held that case of the assessee is not covered by the exceptions laid down in section 270A(6) of the Act. Accordingly penalty u/s 270A of the Act for under reporting of income in consequence of mis- reporting of income as per section 270A is leviable. For better understanding relevant portion of provisions made in section 270A of the Act is reproduced below:- "(2) A person shall be considered to have under-reported his income, if- (a) the income assessed is greater than the income determined in the return processed under clause (a) of sub-section (1) of section 143; (b) the income assessed is greater than the maximum amount not chargeable to tax, where no retum of income has been furnished 72[or where return has been fumished for the first time under section 148]; (c) the income reassessed in greater than the income assessed or reassessed immediately before such reassessment: (d) the amount of deemed total income assessed or reassessed as per the provisions of section 115JB or section 115JC, as the case may be, is greater than the deemed total income determined in the return processed under clause (a) of sub-section (1) of section 143;
(e) the amount of deemed total income assessed as per the provisions of section 115JB or section 115JC is greater than the maximum amount not chargeable to tax, where 73 [no return of income has been furnished or where return has been furnished for the first time under section 148]: (f) the amount of deemed total income reassessed as per the provisions of section 115JB or section 115JC, as the case may be, is greater than the deemed total Income assessed or reassessed immediately before such reassessment, (g) The income assessed or reassessed has the effect of reducing the loss or converting such loss into income. (7) The penalty referred to in sub-section (1) shall be a sum equal to fifty percent of the amount of tax payable on under-reported income" 3.7.3 During course of assessment, the assessee sold a immovable property for the sale consideration of Rs. 80,00,000/- on which LTCG of Rs. 24,70,490/- was arisen, Although the assessee had entered into above mentioned transactions neither the assessee filed his return of income nor deposited tax arisen on the transfer of the said immovable property. Only after issuance of the notice u/s. 148 of the Act, the assessee has filed his return of income and deposited tax arisen on the transfer of the said immovable property. Therefore the assessee had under reported income in consequence of mis-reporting of income in the ambit of section 270A(9) of the Act for the AY 2018-19. 3.7.4. In view of the above facts and circumstances, I am satisfied that the assessee committed default of under reporting of income in consequence of mis-reporting of income without reasonable cause. I am also satisfied that, this is fit case for levy of penalty u/s 2 of the Act. The penalty is leviable in respect of total income of Rs. 24,70,490 @ 200% c tax sought to be evaded is worked out Rs. 9,14,842 /. Therefore, I levy penalty of Rs.9,14,842/- u/s 270A of the Act for under reporting of income in consequence of mis- reporting income of the assessee for the said default.
Aggrieved by such penalty order passed by the Ld. AO, the assessee filed appeal before the Ld. CIT(A)/NFAC. Before the Ld. CIT(A)/NFAC, the assessee’s main contentions were that the assessee had limited education having a rural background due to which there was non- compliance on tax filings. The assessee had bonafide belief that the sale of agricultural land was not taxable. Also, the assessee being a first time tax payer complied with tax laws as soon as he became aware of his obligations and hence the alleged under reporting of income was not intentional. The Ld. AO accepted the returned income without making any additions or modifications which shows that no discrepancies, understatements or concealment of income have been identified and hence there is no justification for imposing the impugned penalty. However, the Ld. CIT(A)/NFAC did not find these contentions of the assessee tenable and dismissed the appeal of the assessee thereby confirming the penalty of Rs.914,842/- levied by the Ld. AO by observing as under:- 7.1 I have gone through the penalty order, grounds of appeal & statement of facts, assessment order & written submissions filed by the appellant during the course of appellate proceedings. 7.2 During the year, the appellant has sold an immovable property and received sale consideration of Rs. 80,00,000/-. The buyer has made TDS of Rs.80,000/- while paying consideration of Rs 80,00,000/- to appellant. Credit for TDS of Rs 80,000/- appeared in 26AS statement of appellant for the year. The AO noticed that no return of income has been filed by appellant for the year despite having Income from capital gain on sale of immovable property. The case was reopened by issuing notice u/s 148. In response notice u/s 148, the appellant filed ROI with returned income of Rs.24,70,490/-, The AO finalised assessment u/s 147 accepting returned income of Rs.24,70,490/-. The AO initiated penalty proceedings u/s 270A for under reporting of income as a consequence of 'Mis reporting of income' and vide order u/s 270A dated 11.09.2023 imposed penalty at 200% i.e., 9,14,842/-. 7.3 During appeal proceedings, submissions made by the appellant against levy of penalty can be summarised as under:- a) The Assessee was under genuine belief that income on sale of agricultural lands is not taxable in view of judgement in Ushaben chauhan vs. ITO (ITA No.501/Ahd/2023) and Motilal Padmapat Sugar Mills (Motilal Padampat Sugar Mills Co. Ltd vs. State of Uttar Pradesh (1979) 118 ITR 326 (SC)). b) Reason for non filing of return is not intention to evade tax but ignorance of tax laws. The AO ignored to notice that return of income was immediately filed in response to notice u/s148 upon realising that income on sale transaction is taxable. Since there is no intention to evade tax. No penalty is leviable. Reliance placed on Meeta Gutgutia vs. ACIT (ITA No. 327/Del/2014). c) Reliance placed on Vasimkhan Pathan vs. ITO (ITA No. 704/SRT/2023) where it is held that penalty is not leviable when income is voluntarily disclosed after reopening the case. 7.4 I have carefully examined the above contention of the appellant in the light of provisions of section 270A of IT Act. Relevant provisions of section 270A are reproduced as under: "270A. Penalty for under-reporting and misreporting of income. (2) A person shall be considered to have under-reported his income, if- (a) the income assessed is greater than the income determined in the return processed under clause (a) of sub-section (1) of section 143; (b)the Income assessed is greater than the maximum amount not chargeable to tax, where no return of income has been furnished or where return has been furnished for the first time under section 148; (c) the income reassessed is greater than the income assessed or reassessed immediately before such reassessment;
(d) the amount of deemed total income assessed or reassessed as per the provisions of section 115JB or section 115JC, as the case may be, is greater than the deemed total income determined in the return processed under clause (a) of sub-section (1) of section 143; (e) the amount of deemed, total income assessed as per the provisions of section 115JB or section 115JC is greater than the maximum amount not chargeable to tax, where no return of income has been furnished or where return has been furnished for the first time under section 148; (f)the amount of deemed total Income reassessed as per the provisions of section 115JB or section 115JC, as the case may be, is greater than the deemed total income assessed or reassessed Immediately before such reassessment; (g)the income assessed or reassessed has the effect of reducing the loss or converting such loss into income. (3)The amount of under-reported income shall be, - (i) in a case where income has been assessed for the first time,- (a) if return has been furnished, the difference between the amount of income assessed and the amount of income determined under clause (a) of sub- section (1) of section 143; (b) in a case where no return of Income has been furnished or where return has been furnished for the first time under section 148,- (A) the amount of income assessed, in the case of a company, firm or local authority; and (B) the difference between the amount of income assessed and the maximum amount not chargeable to tax, in a case not covered in item (A) (ii) in any other case, the difference between the amount of income d or recomputed and the amount of income assessed, reassessed or recomputed in a preceding order:" 7.5 Section 270A(2) provides list of instances upon meeting which it can be considered that there is 'Under reported income' in the hands of assessee. Section 270A(3) gives method to arrive at quantum of 'Under reported income' in the hands of assessee. 270A(2)(b) clearly states that 'under reported income' said to exist in hands of assesee, if income for a year is assessed for the first time and if return of income is filed for the first time u/s 148. 7.6 As per Section 270A(3) (1)(b)(A), incom reoprted Income in cases where return of income is furnished in response to income assessed will be 'Under notice u/s 148 and income is first assessed for the year. In the present case, no prior assessment was done for the year. Return was filed for the first time uls 148 admitting Rs.24,70,490/-. Income was assessed at Rs.24,70,490/- vide order u/s 147 passed for the year. Therefore, as per provisions of section 270A(3)(1)(b)(A), quantum of „Under reported income' in hands of appellant will be „Income assessed‟ i,e Rs 24,70,490/- in the present case. 7.7 It is noticed that AO has levied penalty for misreporting of income u/s 270A(9). Section 270A(9) prescribes instances which can be construed as 'misreporting of income as under:
"Section 270A(a): Cases of Misreporting of income: The cases of misreporting of income shall be the following, namely: 1. Misrepresentation or suppression of facts; 2. Failure to record investments in the books of account: 3. Claim of expenditure not substantiated by any evidence, 4. Recording of any false entry in the books of account; 5. Fallure to record any receipt in the books of account having bearing on total income; and 6. Failure to report any international transaction or any transaction deemed to be an international transaction or any specified domestic transaction, to which the provisions of Chapter X apply." 7.8 Clause (a) of section 270A (9) states that if there is 'misrepresentation or suppression of facts, it amounts to misreporting of income. Therefore, it is to be seen whether facts of present case attracts clause (a) of section 270A (9) or not. The suppression of facts entail a deliberate act of not revealing the facts. Similarly, not furnishing the facts could amount to suppression of facts.In the present case, the appellant by not filing return of income for the year disclosing capital gains earned on sale of immovable property has supressed the fact that he had taxable income in his hands. Thus when 270A(9) (a) is read with 270A(2) (b) and 270A(3) (1) (b) (A), there is under reporting of income consequent to misreporting of income to the extent of Rs.24,70,490/-in hands of appellant. 7.9 Further exclusion provided under section 270A(6)(a) is not applicable in view of 270A(8) as far as cases of misreporting of income like present case is concerned. Section 270A (8) reads as "Notwithstanding anything contained in sub-section (6) or sub-section (7), where under reported income is in consequence of misreporting, the penalty shall be equal to two hundred percent (200%) of the amount of tax payable on under reported income." Thus, provisions of section 270A (6) are not applicable in a case where there is misreporting of income. Hence, claim of appellant that since income returned u/s 148 has been accepted by AO, no penalty u/s 270A can be levied can't be accepted. 7.10 It is noticed that all judicial pronouncements relied on by appellant were rendered in the context of section 271(1)(c) but not in the context of 270A, hence not applicable to facts of present case. Hence, I am of considered view that AO has rightly levied penalty u/s 270A of Rs.9,14,842/-. Consequently, Grounds of Appeal relevant to the issue are Dismissed.
Dissatisfied the assessee is in appeal before the Tribunal and all the grounds of appeal
relate thereto. The assessee has also raised the following additional grounds before the Tribunal : “1. The learned CIT-(A) erred in confirming the penalty u/s 270A of Rs. 9,14,842/- levied by the A.O without appreciating that the said levy of penalty was not justified on facts and in law.
2. The assessee submits that in the reassessment order, the A.O has initiated penalty u/s 270A on a vague charge of furnishing inaccurate particulars of income' also in the notice u/s 274 r.w.s 270A, the exact limb of section 270A(9) which has been allegedly violated by the assessee has not been specified and hence, the penalty order passed u/s 270A inconsequence of such illegal notice may be declared as null and void in law.”
6. It is this submission of the assessee that the additional grounds are purely legal in nature, arising from the facts already on record requiring no fresh investigation for their adjudication and goes to the root of the matter. Placing reliance on the decision of the Hon‟ble Supreme Court in the case of National Thermal Power Co. Ltd. v. CIT (1998) 229 ITR 383 (SC), the assessee has prayed for admission of these additional grounds for adjudication by this Tribunal. Having considered the submission of the assessee and in light of the decision of the Hon’ble Supreme Court in the case of NTPC (supra), we hereby admit the additional grounds raised by the assessee and proceed to adjudicate the same.
The Ld. AR, at the outset, referring to the penalty notice issued by the Ld. AO (Page 10 of the Paper Book refers) submitted that the notice itself is invalid as it does not specify the relevant limb under sub-section 9 of section 270A of the Act. Relying on the various decisions of the Hon’ble High Courts and Tribunals and specifically drawing our attention to the decision of the co-ordinate bench of the Pune Tribunal in the case of Smita Virendra Lodha vs. ITO (ITA No. 1980/PUN/2024 for A.Y. 2018-19 order dated 12.11.2024, the Ld. AR submitted that since the Ld. AO has not mentioned under which clause of section 270A of the Act the impugned penalty has been levied, it is not levied in accordance with law and hence liable to be deleted.
Even on merit also, reiterating the contentions raised before the Ld. CIT(A)/NFAC, the Ld. AR submitted that the non-compliance regarding tax filings was due to limited education and rural background of the assessee, the assessee is a first time offender with no knowledge of tax laws and immediately complied with relevant law as soon as he became aware of his obligations. The assessee had bonafide belief that the transaction of the sale of agricultural land was not taxable. Further, since the return of income has already been accepted by the Department and no addition has been made, therefore no penalty u/s 270A of the Act should be levied.
The Ld. DR, on the other hand, strongly supported the order(s) of the Ld. AO and Ld. CIT(A)/NFAC. The Ld. AR submitted that if no notice u/s 148 of the Act would have been issued, the assessee would not have filed his return of income and declared income of Rs. 24,70,490/- and hence the impugned penalty of Rs. 9,14,842/- levied by the Ld. AO and sustained by the Ld. CIT(A)/NFAC is fully justified.
We have heard the Ld. Representatives of the parties, perused the material available on records, paper book filed by Ld. AR on behalf of the assessee as well as various judicial precedents relied upon by Ld. AR. From the perusal of the assessment order, it is seen that the Ld. AO completed the assessment u/s 147 r.w.s 144B of the Act on total income of Rs. 24,70,490/- which was the income returned by the assessee in response to the notice u/s 148 of the Act. The Ld. AO despite of accepting the income returned by the assessee initiated penalty proceedings u/s 270A of the Act on account of under reporting of income in consequence of mis-reporting and levyied a penalty (@200% of the tax amount sought to be evaded of Rs. 9,14,842/- which has been confirmed by the Ld. CIT(A)/NFAC @ 200% for the reasons reproduced in the preceeding paragraphs.
Before us by way of an additional ground the Ld. AR has submitted that in the notice u/s 274 r.w.s 270A of the Act, the exact limb of section 270A(9) has not been specified and hence the penalty order passed u/s 270A in consequence of such notice becomes null and void in law.
We find some force in above contention of the Ld. Counsel for the assessee. We have perused the order of the Co-ordinate Bench of this Tribunal in the case of Smita Virendra Lodha (Supra) and find that under the identical set of facts, the Tribunal relying on the case of Kishor Digambar Patil Vs. ITO (ITA No. 54 & 55/PUN/2023 dated 30.03.2023) deleted the penalty levied u/s 270A of the Act on account of non mentioning of any of the specified limbs u/s 270A(9) of the Act. The relevant findings and observations of the Tribunal in the case of Smita Virendra Lodha as under:- 10. We have heard the rival arguments made by both the sides and perused the orders of the Assessing Officer and Ld. CIT(A)/NFAC.
We find the Assessing Officer completed the assessment u/s 147 2.w.s. 1448 of the Act on a total income of Rs.18,74,800/- which was the income returned by the assessee in response to the notice u/s 148 of the Act. We find the Assessing Officer levied the penalty of Rs.6,37.912/- u/s 270A of the Act on account of under-reporting of income in consequence of mis-reporting. We find the Ld. CIT(A)/NFAC upheld the action of the Assessing Officer, the reasons of which have already been reproduced in the preceding paragraphs. It is the submission of the Ld. Counsel for the assessee that the penalty notice issued by the Assessing Officer is silent about the clause under which the assessee has under-reported or mis-reported the income.
11. We find some force in the above arguments of the Ld. Counsel for the assessee. We find the Co-ordinate Bench of the Tribunal in the case of Kishor Digambar Patil vs. ITO (supra) while deciding an identical issue has quashed the penalty levied u/s 270A for failure of the Assessing Officer in quoting any of the six limbs as mentioned in section 270A(9) of the Act. The relevant observations of the Tribunal from para 4 onwards read as under: "4. Both the learned representatives vehemently reiterated their respective stands against and in support of the impugned penalties. The assessee more particularly argued that both the learned lower authorities have erred in law and on facts in imposing sec.270A penalties in issue without even specifying the relevant limb under sub-section (9) thereof pertaining to "misreporting of income". Learned counsel quoted the erstwhile earlier penalty mechanism provided u/sec.271(1)(c) of the Act wherein the law stood duly settled in light of Mohd. Farhan A Shaikh vs. ACIT [2021] 434 ITR 1 (Bom.) (FB); CIT vs. M/s. SSA's Emerald Meadows [2016] 386 ITR (St.) 13 (SC) and CIT vs. Manjunatha Cotton Ginning Factory (2013) 359 ITR 565 (Kar) (HC) that an assessing authority has to specify
the corresponding limb in the show cause notice to be issued u/sec.274 of the Act. Learned counsel's case is that the legal position would hardly be any different wherein the ature has now prescribed clauses (a) to (f) in sec.270A (9) of the Act only to "rationalise and bring objectives, certainty and clarity in the penalty previsions as per the CBDT's circular no.3/2017 [F.No.370142/20/2016 TPL]. Mr. Sonawane strongly argued in tune thereof that the very line of reasoning is required to be adopted herein as well whilst dealing with penalty proceedings under this new scheme of u/s.270A introduced by the legislature by the Finance Act, 2016 w.e.f. 01.04.2017 5. Mr. Murkunde on the other hand strongly supported the learned lower authorities action imposing the impugned penalties. He took us to the Assessing Officer's corresponding assessments, penalty orders as well as the lower appellate discussion extracted in the preceding paragraphs that the rigor of sub-section (9) stands duly complied with once it has been categorically concluded that this is a fit case to impose penalty u/sec.270A of the Act for "under reporting which is in consequence of misreporting of income". His further contention is that such a penalty @ 200% is levied u/sec. 2700(8) of the Act reading as under: Sec.270A(8)-Notwithstanding anything contained in subsection (6) or sub-section (7), where under-reported income is in consequence of any misreporting thereof by any person, the penalty referred to in sub- section (1) shall be equal to two hundred per cent of the amount of tax payable on underreported income." 5.1. Mr. Murkunde lastly sought to buttress the point that section 270A(8) nowhere makes it mandatory to include any of the clause "(a) to (f)" provided in sub-section (9) thereof. He further submitted that various judicial precedents quoted at the assessee's behest in the preceding paragraphs are no more applicable once the legislature has amended the penalty provision. i.e., sec.271 itself.
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 ie, 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" and "misreporting of income" in sub-sections (2) and (9) (a to f) respectively. In my considered opinion, once the instant twin appeals involve levy of penalty @ 200% of the taxes sought to be evaded and the learned lower authorities have held the assessee to have "under-reported his taxable income in consequence to misreporting", the latter limb of misreporting containing six "sub-limbs" in clauses (a to f) under sub- section- (9) deserve to be read as an extension of sub- section (8) to section 270A only. This indeed seems to be the only possible view as the legislature has incorporated the non-obstante clause "Notwithstanding anything contained in sub-sec (6) or sub-sec(7)" thereby not including the sub-section (9) envisaging the Instances defining "misreporting of income” in section 270A of the Act. 6.1. Mr. Murkunde could further not dispute the fact that right from the Assessing Officer's twin assessments to his Impugned penalty orders as well the NFAC detailed discussion, the learned lower authorities have nowhere specified the corresponding "sub-limbs" (a to D in sub-sec.(9) of sec.270 of the Act. That being it explicitly clear that these six clauses (a to f) would indeed form part of sub-section (supra) making (8) to sec.270A as under: "62.10 The rate of penalty shall be fifty per cent of the tax payable on under-reported income. However in a case where under reporting of income results from misreporting of income by the assessee, the person shall be liable for penalty at the rate of two hundred per cent of the tax payable on such misreported income. The cases of misreporting of income have been specified as under: (i) misrepresentation or suppression of facts; (ii) non-recording of investments in books of account:
(iii) claiming of expenditure not substantiated by evidence; (iv) recording of false entry in books of account; (vi) failure to record any receipt in books of account having a on total income; (vi) failure to report any international transaction or deemed international transaction under Chapter X of the Income tax Act." 6.2. Faced with the situation and in light of overwhelming material strongly supporting the assessee's case and going by stricter interpretation as per Commissioner of Customs (Imports), Mumbai vs. Dilipkumar And Co. & Ors. 2018 (9) SCC 1 (SC) (FB), I am of the view that the above stated judicial precedents regarding the "limb theory" would squarely apply even in case of failure of the Assessing Officer to quote any of the six sub-limbs as well prescribed in sec.270A(9) (a) to (f) of the Act introduced by the legislature in order to rationalize and bring objectivity, certainty and clarity in the penalty provisions". And that his noncompliance to this clinching effect would not only defeat the legislative mandate but also it renders the amending provisions an otiose. I accordingly hold in these peculiar facts and circumstances that both the impugned penalties deserve to be quashed as not sustainable in the eye of law. Ordered accordingly.
12. Since the Assessing Officer in the instant case has admittedly not mentioned as to under which limb of sub-section (9) of section 270A he has levied the penalty, therefore, respectfully following the decision of the Co-ordinate Bench of the Tribunal in the case of Kishor Digambar Patil vs. ITO (supra), we hold that the penalty so levied by the Assessing Officer u/s 270A is not in accordance with law. We, therefore, set aside the order of the Ld. CITTA)/NFAC and direct the Assessing Officer to delete the penalty. The grounds raised by the assessee are accordingly allowed.
In light of the facts of the case and legal position enumerated above and respectfully following the decision of the co-ordinate bench of the Tribunal in the case of Smita Virendra Lodha (supra), we hold that the penalty of Rs. 19,14,842/- imposed u/s 270A of the Act is not sustainable in law for the reason that the penalty notice issued by the Ld. AO is silent on the relevant clause of sub-section 9 of section 270A of the Act under which the assessee has under reported/mis-reported his income. We, therefore, set aside the order of the Ld. CIT(A)/NFAC and direct the AO to delete the impugned penalty. We hold and direct accordingly. The additional grounds raised by the assessee are accordingly allowed. Since we have decided the additional grounds in favour of the assessee, the other grounds raised by the assessee become academic in nature requiring no adjudication.
In the result, appeal of the assessee is allowed.
Order pronounced in the open court on 30th October, 2025.