Tribunal Deletes Penalty of Rs. 10,38,976 for 2017-18, Emphasizing Disclosure of Interest Income in Tax Assessment.

The Tribunal allowed the assessee's appeal, ordering the deletion of the penalty of Rs. 10,38,976 under sec. 270A of the Income Tax Act, 1961, for the assessment year 2017-18. The Tribunal concluded that the interest income was duly disclosed, rejecting the Revenue's arguments and emphasizing that quantum additions do not automatically warrant penalties.

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Issues:
The judgment involves proceedings u/s. 270A of the Income Tax Act, 1961 for assessment year 2017-18, concerning the imposition of penalty for under-reporting income due to misreporting.

Assessee's Challenge:
The assessee challenged the correctness of the penalty imposed under sec. 270A(8) and (9) amounting to Rs. 10,38,976, contending that the interest income of Rs. 14,61,904 on income tax refunds was duly disclosed in the computation submitted during quantum assessment. The Revenue argued that the interest income was not disclosed.

Judgment:
After considering the pleadings and arguments, the Tribunal found no merit in sustaining the penalty. The Tribunal noted that the interest income was included in the indirect income head of Rs. 15,16,593.67 as per the audited books and ledger submitted by the assessee. The Tribunal rejected the Revenue's request for verification, stating that all relevant details were part of the case file from assessment to penalty proceedings. Citing the Supreme Court's decision in CIT vs. Reliance Petro Products, the Tribunal emphasized that additions in quantum proceedings do not automatically attract penalty provisions. Consequently, the Tribunal ordered the deletion of the penalty of Rs. 10,38,976.

Conclusion:
The Tribunal allowed the assessee's appeal, pronouncing the order in open court on 25.04.2024.

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