AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2024 (4) TMI 1115
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....e facts and circumstances of the case and the provision of Law the Ld. CIT(A) has erred in not appreciating the fact that the impugned penalty order passed is without considering the reply submitted by the assessee and thus, the penalty order passed is bad in the eyes of law and liable to be quashed. 4. That on the facts and circumstances of the case and the provision of law the Ld. CIT(A) has erred in sustaining the penalty of Rs. 425614/- u/s 270A of the Act. 5. That without prejudice to the ground no. 4 above on the facts and circumstances of the case and the provision of Law the Ld. CIT(A) has erred in not appreciating the fact that the Ld. AO erroneously imposed the penalty for under reporting of income @200% instead of 50%. 6. That the appellant craves leave to reserve to itself the right to add, alter, amend, vary, modify and/or withdraw any ground(s) of appeal at or before the time of hearing. All of the above grounds of appeal are without prejudice and mutually exclusive to each other." 3. Facts in brief are that in this case, the assessee e-filed his return of income, declaring total income of INR 4,93,460/- on 16.03.2018. The case was processed u/s 143(1) of the....
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.... was imposed u/s 270A(8) upon the assessee vide order dated 26.03.2022. 3. Against the penalty order dated 26.03.2022, the assessee preferred, an appeal before the CIT(A), who affirmed the order of the Ld. AO. Therefore, now the assessee is before this Hon'ble ITAT. Certain dates which are crucial to issues involved in present matter are as under: DATE PARTICUALRS REMARKS 16.03.2018 Assessee filed his ITR at Rs. 4,93,460/- 27.12.2019 Assessment order u/s 143(3) was passed determining the total income at Rs. 13,53,184/-. Assessee did not prefer appeal before CIT(A) against such order. 27.12.2019 Penalty notice u/s 270A was issued to the assessee It was issued for "Underreporting of income" (Penalty notice annexed with this synopsis) (Para 3 at P.NO. 2 of Penalty Order) 26.03.2022 Penalty order u/s 270A was passed imposing penalty @ 200% Para 9 at P.NO. 4 of Penalty order 30.05.2023 CIT(A) order affirming the penalty order dated 26.03.2022 4. During the penalty proceedings, Ld. AO imposed the penalty u/s 270A @ 200% of the amount of tax payable on under-reported income observing: a) That assessee had under-reported his income for the ....
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....ssessee as to why the assessee should not be imposed with penalty for 'under reporting of income'. Therefore, the assessee could be expected to give reply only in respect of show cause notice that is put to him and cannot be assumed to infer/ assume/presume that merely because the Ld. AO recorded satisfaction in the quantum assessment order that offence of both 'under reporting' and 'mis-reporting' is committed by the assessee and therefore, accordingly the penalty would also be levied on the assessee for both in terms of section 270A(9) of the Act. 13. It is further submitted that the various High Courts and Benches of the Tribunal repeatedly held that the defective penalty notice issued by the Department without mentioning the proper limbs and details will be fatal to the entire penalty proceedings. 14. It is submitted that the Hon'ble jurisdictional HC in similar circumstances had quashed the penalty proceedings u/s 270A in the case of Schneider Electric South East Asia (HQ) Pte Ltd vs. ACIT in W.P.(C) 5111/2022 (Del) dated 28.03.2022, The Hon'ble High held as under (para 7): "This Court also finds that there is not even a whisper as to whic....
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....sub-section (1) of section 143; (b) the income assessed is greater than the maximum amount not chargeable to tax, where no return of income has been furnished or where return has been furnished for the first time under section 148; (c) the income reassessed is greater than the income assessed or reassessed immediately before such reassessment; (d) the amount of deemed total income assessed or reassessed as per the provisions of section 115JB or section 115JC, as the case may be, is greater than the deemed total income determined in the return processed under clause (a) of sub-section (1) of section 143; (e) the amount of deemed total income assessed as per the provisions of section 115JB or section 115JC is greater than the maximum amount not chargeable to tax, where no return of income has been furnished or where return has been furnished for the first time under section 148; (f) the amount of deemed total income reassessed as per the provisions of section 115JB or section 115JC, as the case may be, is greater than the deemed total income assessed or reassessed immediately before such reassessment; (g) the income assessed or reassessed has the effect of reducing the lo....
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....ared in the return or converting that loss into income, the amount of under-reported income shall be the difference between the loss claimed and the income or loss, as the case may be, assessed or reassessed. (4) Subject to the provisions of sub-section (6), where the source of any receipt, deposit or investment in any assessment year is claimed to be an amount added to income or deducted while computing loss, as the case may be, in the assessment of such person in any year prior to the assessment year in which such receipt, deposit or investment appears (hereinafter referred to as "preceding year") and no penalty was levied for such preceding year, then, the under-reported income shall include such amount as is sufficient to cover such receipt, deposit or investment. (5) The amount referred to in sub-section (4) shall be deemed to be amount of income under-reported for the preceding year in the following order- (a) the preceding year immediately before the year in which the receipt, deposit or investment appears, being the first preceding year; and (b) where the amount added or deducted in the first preceding year is not sufficient to cover the receipt, deposit or investme....
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.... account; (c) claim of expenditure not substantiated by any evidence; (d) recording of any false entry in the books of account; (e) failure to record any receipt in books of account having a bearing on total income; and (f) failure to report any international transaction or any transaction deemed to be an international transaction or any specified domestic transaction, to which the provisions of Chapter X apply. (10) The tax payable in respect of the under-reported income shall be- (a) where no return of income has been furnished or where return has been furnished for the first time under section 148 and the income has been assessed for the first time, the amount of tax calculated on the under-reported income as increased by the maximum amount not chargeable to tax as if it were the total income; (b) where the total income determined under clause (a) of subsection (1) of section 143 or assessed, reassessed or recomputed in a preceding order is a loss, the amount of tax calculated on the under-reported income as if it were the total income; (c) in any other case, determined in accordance with the formula- (X-Y) where, X = the amount of tax calculated on the und....