Clarification on the immunity provided u/s 270AA of the Income-tax Act, 1961

Immunity under section 270AA does not preclude contesting earlier years nor imply acquiescence in penalty proceedings.

Section 270AA allows an assessee to apply for immunity from specified penalties and initiation of criminal proceedings-chiefly immunity from imposition of penalty under section 270A (excluding misreporting penalties) and from initiation of prosecution-subject to conditions and Assessing Officer discretion. Filing an immunity application does not preclude the assessee from contesting the same issue in earlier assessment years, and tax authorities must not treat such an application as acquiescence that justifies an adverse view in penalty proceedings for prior years.