MYUMGHWA AUTOMOTIVE INDIA PVT. LTD.,KANCHIPURAM vs. ITO, CORPORATE WARD-4(1), CHENNAI

ITA 2660/CHNY/2025Status: DisposedITAT Chennai11 February 2026AY 2017-18Bench: SHRI ABY T VARKEY (Judicial Member), SHRI S. R. RAGHUNATHA (Accountant Member)1 pages
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What did the Tribunal hold?

The Tribunal held that belated remittance of employees' contribution to PF/ESI, even if disallowed as a deduction, does not fall under the clauses of 'misreporting of income' as defined in Section 270A(9). The penalty was considered unsustainable in law.

What were the facts?

The assessee company filed a Nil income return for AY 2017-18. The Assessing Officer disallowed employees' contribution to EPF and ESI for belated payments. Consequently, a penalty was levied under Section 270A for 'misreporting of income'.

What were the issues?

Whether penalty under Section 270A for 'misreporting of income' is leviable when an expense claimed as deduction is disallowed due to belated payment of employee contributions to PF/ESI, and whether the specific conditions for 'misreporting' under Section 270A(9) are met.

Which sections of the Income-tax Act were involved?

Section 270A,Section 143(3),Section 36(1)(va),Section 250

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Income Tax Appellate Tribunal, ‘B’ BENCH, CHENNAI

Before: SHRI ABY T VARKEY & SHRI S. R. RAGHUNATHA

For Respondent: Shri. K. Ilayaraja, Addl. CIT
Hearing: 17.12.2025Pronounced: 11.02.2026

PER S. R. RAGHUNATHA, AM:

The present appeal is filed by the assessee against the order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred to as “ld.CIT(A)”) dated 18.07.2025, dismissing the appeal filed by the assessee against the penalty order dated 12.11.2021 passed u/s.270A of the Income Tax Act, 1961 (hereinafter referred to as the “Act”), pertaining to Assessment Y

The order continues below.

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