THE KOZHIKODE DISTRICT CO OPERATIVE RUBBER MARKETTING SOCIETY LTD,KOZHIKODE vs. COMMISSIONER OF INCOME TAX, KOZHIKODE

Coming to the assessee’s sole substantive grievance therein seeking to reverse both the lower authorities action imposing section 270A penalty amounting to Rs.1,06,038, we note that it had claimed sec.80P deduction qua rental income . The Kozhikode Dist Co-op Rubber Mktg So Ltd. derived from godown after letting out the same to its members. The Assessing Officer’s assessment dated 10.07.2019 disallowed the said claim on the ground that it was let out to some non-members for commercial purposes. Learned DR vehemently submits in these factual backdrop the impugned penalty reserves to be sustained.

We find that no merit in the revenue’s instant argument as once the legislature itself has made it clear in sec.270A(6)(a) that even a bonafide explanation tendered by an assessee excludes operation of the impugned penalty provision in case of bonafide explanation with disclosure of all the relevant facts. We thus treat it as a case of bonafide mistake to delete the impugned penalty in the very terms.