TaxTMI 
TaxTMI 
2024 (4) TMI 708
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....vidual and was an employee of Maharashtra State Electricity Generation Company Ltd [in short 'MSEGCL'], a State Government of Maharashtra [in short 'GoM'] owned company, wherefrom the assessee retired on 31/05/2016. Declaring total income of Rs. 44,68,490/- with NIL tax liability the assessee filed his original return of income [in short 'ITR'] which subsequently was revised claiming tax refund of Rs. 3,09,000/- owning to upward revision of claim of exemption of Gratuity to Rs. 20 Lakhs as against original claim of Rs. 10 Lakhs. The said ITR was initially processed u/s 143(1) of the Act and later subjected to complete scrutiny by a notice served u/s 143(2) of the Act. 2.2 While framing assessment u/s 143(3) of the Act, the Ld. AO made two ....
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....egal position. 4. Insofar as incorrect reporting of interest income is concerned, it is on record that, as on the date of filing of return the amount of interest earned as appearing in Form No 26AS has been rightly offered to tax. As such the difference in interest income came to light post filing of ITR and on account of delayed reporting by the deductor/payer bank/Financial Institution. In view thereof in our considered view same cannot tantamount to under-reporting of income, consequently de-horses from attracting any penalty u/s 270A of the Act. 5. Insofar as the penalty imposed against disallowance of enhanced claim of gratuity exemption is concerned, we observed that, the appellant assessee was in service previously with Maharashtra....
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....s 270A @ accelerated rate of 200% of tax sought to be evaded for mis-reporting of income through excess claims made in the revised ITR filed. 7. Though we are not dealing with the correctness of disallowance whereby the exemption claims were restricted to the extent of maximum ceiling fixed in relation to non-government employees, but it would not be out of the box to state that, insofar as the gratuity is concerned, undisputedly it was accrued to the appellant evenly throughout his service tenure. Therefore, the portion of gratuity which is accrued to him from the year of joining his services with MSEB upto the year of transfer of his service to MSEGCL was entitled to full exemption being Government Service. The balance gratuity thus repr....
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....rities below in our considered view were failed to appreciate the facts and circumstance of the present case holistically and further in right spirit of law, but dealt therewith without application of mind and perfunctory imposed / confirmed the penalty @ accelerated rate of 200% u/s 270A of the Act in unwarranted case like this. A similar view can also be traced in the decision of co-ordinate bench in ITA NO. 1388/PUN/2023 AV Wandhekar Vs ITO. Dt. 08/03/2024. 9. Before parting, it is apt to note here that, the possibility of presence of doubt in the mind of Ld. AO while deciding the ceiling of exemption as to whether status of employment as at the time of joining or at the time of retirement is to be considered, cannot be completely ruled....