TaxTMI 
TaxTMI 
TaxTMI 
2025 (2) TMI 1612
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.... sub-section 2 of section 270A of the Act, it is fact that all penalty notices are to be compulsorily issued from ITBA and at the time of issuing penalty notice in the ITBA system, there is no option to pin the limb, its the default notice which is automatically selected from ITBA and AO can only filed assessee details and put his/her signature. AO cannot alter body of the notice. Therefore, the AO could not have pined the limb in the notice issued u/s 270A of the Act. 3. Ld. CIT (A) failed to appreciate fact of the case in light of the provision u/s 274 of the I.T. Act in which does not anywhere mention that the limb of sub section and section is to be mentioned while issuing notice u/s 274 of the Act. 4. The Ld. CIT(A) erred in appreciating the facts of the case as section 270A(1) which is operative part of the section only says that the assessing officer or the Joint Commissioner (Appeals) or the 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 underreported income. 5. The appellant craves leave to add, amend or alter al....
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.... income returned by the assessee at Rs. 17,86,810/-. The above assessed income includes addition of Rs. 1,11,00,000/- u/s 69A subject to special rate of tax u/s 115BEE and also other additions amounting in all to Rs. 64,65,000/-. The Assessing Officer in the above assessment order also initiated penalty u/s 274 r.w.s. 271AAC(1) of the IT Act. 4. The assessee preferred appeal against the above assessment order and Ld. CIT(A), Pune-12 partly allowed the appeal of the assessee and directed the Assessing Officer not to tax the additional income of Rs. 1,11,00,000/- u/s 115BEE since the income represents professional income only. The Assessing Officer then wrote a letter to Ld. CIT(A), Pune-12 and asked the permission to levy penalty u/s 270A of the IT Act. Ld. CIT(A), Pune-12 replied on 02.01.2023 that : "penalty proceedings u/s 270A of the IT is consequential to the direction of taxing the said income under the different head. Therefore, if required penalty proceedings u/s 270A of the IT Act may be initiated by the Assessing Officer at the time of giving effect to the appeal order dated 28.11.2022 as deemed fit". 5. The Assessing Officer then issued show-cause notice u/....
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.... in the eye of law. In view of the above, penalty levied u/s 270A of the Act is bad in law. Hence, the Ld. AO is directed to delete the impugned penalty. As the penalty order u/s 270A is held to be bad in law based on the limb theory, the grounds No. 1 to 10 are not separately adjudicated, Ground No. 11: 4. Under this ground of appeal the appellant has sought to reserve the right to add/alter/ amend / withdraw any of the grounds of appeal. Since no such request has been made by the appellant during appellate proceedings, this ground is hereby dismissed. Ground No. 12: 5. The ground No. 12 raised by the appellant is of general nature and has not been exercised during the appellate proceedings. The ground No. 12 is accordingly dismissed. 6. With the result, appeal is partly allowed." 6. It is this order against which the Revenue is in appeal before this Tribunal. 7. Ld. DR appearing from the side of the Revenue submitted before us that the order passed by Ld. CIT(A) deleting the penalty imposed u/s 270A is unjustified. Ld. DR submitted before us that the Revenue has raised total four effective grounds and in all the grounds, the Reve....
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....er. Even in first appeal proceedings, Ld. CIT(A) himself has not initiated the penalty u/s 270A of the IT Act. It was only when the Assessing Officer asked from Ld. CIT(A) that penalty u/s 270A can be initiated or not, Ld. CIT(A) only guided him that the penalty u/s 270A may be initiated and no such specific direction was given by Ld. CIT(A). Accordingly, we find that the penalty u/s 270A was not initiated in the first appeal order which was filed against the quantum assessment order but it was initiated while giving effect to the first appellate order in the quantum case. It is also one of the submission of the assessee that the penalty order needs to be passed within six months from the date of order of assessment dated 19-04-2021 or order of appeal dated 28-11-2022 whichever is later, but in the instant case the penalty order was passed in the month of July 2023 and, therefore, the same is time barred. In this regard, we find that the assessee has not filed any cross appeal and this appeal has been filed by the Department. We further find that the Co-ordinate Bench of this Tribunal in various decisions is of the view that if no specific clause has been mentioned in the notice th....