AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (11) TMI 1473
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....the levy of penalty of Rs.4,26,771 is unjustified, arbitrary, and bad in law. Technical ground 3 The Ld. CIT(A) failed to appreciate that the Assessing Officer (AO) had not specified in the assessment order or in the penalty notice the limb under which the penalty was proposed to be levied under section 270A(2) or 270A(6), rendering the penalty proceedings invalid ab initio, as held in several judicial precedents. Technical ground 4 The Ld. CIT(A) erred in not adjudicating upon the specific ground raised by the appellant that no penalty under section 270A could be levied in the absence of any variation between the returned income processed under section 143(1)(a) and the income assessed under section 143(3). Technical ground 5 The Ld. CIT(A) failed to appreciate that under section 270A(2)(a), under-reporting arises only if the income assessed is greater than the income determined in the return processed under section 143(1)(a); whereas, in the appellant's case, there was no such difference. Accordingly, the question of under-reporting of income does not arise. Technical ground 6 The Ld. CIT(A) failed to appreciate that the AO initiated penalt....
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....TAT Pune 2024(7) TMI 1618 6 Kasat Prakash M (HUF) vs ITO ITAT Pune 2024(9) TMI 1102 7 Saltwater Studio LLP vs NFAC ITAT Mumbai [2023] 157 taxmann.com 749 (Mumbai - Trib.) 8 Kishor Digambar Patil vs ITO ITAT Pune [2023] 149 taxmann.com 502 (Pune - Trib.) 4. On the other hand, the learned DR has submitted that the assessee has reported loss in the return of income whereas the Assessing Officer has assessed the total income of the assessee by making an addition of Rs. 27,72,271/- and therefore, it amounts to under reporting of the income on the part of the assessee attracting the provisions of section 270A of the I.T. Act. He has referred to clause (g) of sub section 2 of section 270A and submitted that the income assessed or re-assessed as fact of reducing the loss or converting the said loss into income will be considered as under reporting. He has relied upon the orders of the authorities below. 5. We have considered the rival contentions as well as the relevant material available on record. At the outset, we note that the return of income filed by the assessee was processed u/s 143(1) of the Act on 27/03/2019 whereby the CPC has made an....
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....r Commissioner may, during the course of any proceedings under this Act, direct that any person who has under-reported his income shall be liable to pay a penalty in addition to tax, if any, on the under-reported income. (2) A person shall be considered to have under-reported his income, if- (a) the income assessed is greater than the income determined in the return processed under clause (a) of 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 amoun....
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....s 143(1)(a) of the Act. Accordingly, the case of the assessee does not fall in any of the conditions provided u/s 270A of the Act attracting the levy of penalty. Once the condition as stipulated u/s 270A are not satisfied, the penalty levied by the Assessing Officer vide the impugned order is not sustainable and liable to be deleted. The Hon'ble Gujarat High Court in case of Pr.CIT vs. Prafullbhai Vallabhdas Fuletra (Supra) has upheld the order of the Tribunal in Para 4 to 4.2 as under: "4. Reading the order of the Tribunal would indicate that the Tribunal while confirming the order of the CIT(A) found that the conditions specified in Section 270A of the Act could not be invoked and so also regarding levy of penalty. The Tribunal noticed that the case is not covered under the provisions of section 270A(2)(a) of the Act for the reason that the income assessed and the income processed u/ s. 143(1)(a) are same or in other words, income assessed was not greater than the income determined in return processed u/ s. 143(1)(a) of the Act. As per provisions of section 270A(3)(i)(a) of the Act as there was no difference between the amount of income assessed and amount of income ....
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....it of foreign tax shall be allowed only on furnishing the details and documents in Form 67 before the due date of filing the return u/s 139(1) of the I.T. Act, 1961. Accordingly, the Assessing Officer has disallowed the claim of Foreign Tax Credit and added the same to the total income of the assessee. The concluding part of the assessment order is as under: "Therefore, the assessee claimed tax relief u/s 90/90A (2 of schedule TR) amounting to Rs. 37,63,898/- is added to the total tax of the assessee because the assessee filed Form-67 after due date of filing the Income Tax Return and the penalty u/ s 270A(9) of the I.T. Act, 1961 is initiated". 6. The Assessing Officer then initiated the proceedings to levy the penalty u/s 270A of the Act which contemplates a penalty in addition to tax, if any, on under reported income. Sub-section (2) of section 270A envisage the situation under which a person shall be considered to have under reported his income as under: Section 270(A) ... "(2)A person shall be considered to have under-reported his income, if- (a)the income assessed is greater than the income determined in the return processed under ....
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....eason of misrepresenting or suppressing of facts, failure to record the investment in the books of account, unsubstantiated claim of expenditure disallowed, recording false entries in the books of account, failure to record any receipt in the books of account having bearing on the total income and failure to report any international transaction or specified domestic transactions. In the case in hand, though the Assessing Officer has not enhanced the total income of the assessee while passing the assessment order, but the tax liability of the assessee was increased due to the reason that the claim of credit of foreign tax was denied by the Assessing Officer due to the reason of delay in filing Form- 67. Thus, it is clear from the facts that the case of the assessee does not fall in the category of misreporting of income as envisaged in sub-section (2) and (9) of section 270A of the I.T. Act, 1961. The learned CIT(A) has deleted the penalty levied by the Assessing Officer in para 5 as under: 5. Decision: All the grounds of appeal are related to levy of penalty u/s 270 of the Act. Issue is related to late filing of Form No. 67 for claiming foreign Tax credit of Rs. 3....