SHARP GARUDA FARM EQUIPMENTS PVT.LTD,COIMBATORE vs. DCIT, CORPORATE CIRCLE 1, , COIMBATORE

ITA 3394/CHNY/2025Status: DisposedITAT Chennai17 March 2026AY 2020-21Bench: SHRI GEORGE GEORGE K (Vice President), SHRI S.R. RAGHUNATHA (Accountant Member)1 pages
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What did the Tribunal hold?

The Tribunal held that the assessee had voluntarily surrendered the claim and made a full and true disclosure of all material facts at the time of filing the revised return, which was based on prevailing judicial pronouncements. Therefore, the penalty levied under Section 270A(8) r.w.s. 270A(9) was unwarranted.

What were the facts?

The assessee company claimed deduction for education cess in its revised return for AY 2020-21. Subsequently, it withdrew this claim upon learning of a proposed amendment to Section 40(a)(ii) of the Income Tax Act, 1961. However, the Assessing Officer (AO) initiated penalty proceedings under Section 270A for under-reporting income.

What were the issues?

Whether the penalty levied under Section 270A is sustainable when the assessee voluntarily withdrew a deduction claim based on a bona fide belief, which was subsequently found unsustainable due to a retrospective amendment.

Which sections of the Income-tax Act were involved?

Section 270A,Section 40(a)(ii),Section 143(2),Section 143(3),Section 144B,Section 274

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Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI

Before: SHRI GEORGE GEORGE K & SHRI S.R. RAGHUNATHA

Hearing: 12.03.2026Pronounced: 17.03.2026

PER GEORGE GEORGE K, VICE PRESIDENT:

This appeal filed by the assessee is directed against the order of Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi, dated 15.10.2025 passed under section 250 of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The relevant Assessment Year is 2020-21 :- 2 -:

2.

The solitary issue that is raised is whether the First Appellate Authority (FAA)

The order continues below.

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