2026 (7) TMI 1090

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.... 2. The Ld. AR advanced arguments and assailed impugned penalty on bona-fide belief and also on legal grounds. The Ld. CIT-DR stated that but for scrutiny proceedings, the assessee would have escaped higher taxes on its income. Having heard rival submissions and upon perusal of case records, our adjudication would be as under. 3. From case records, it emerges that during this year, the assessee was employed with M/s DHR Holding India Pvt. Ltd. This entity was an Indian limb of parent company M/s Danaher Corporation, USA. The assessee was looking after India & Asia (part) operations of the parent company. The assessee filed original return of income on 17.12.2020 declaring income of Rs. 1283.66 Lacs. The computation of income as placed on....

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....rt interval and reported under the head capital gains. The error occurred due to common man's understanding about capital gain. Further, there was mere change of head of income and therefore, penalty was not justied. However, rejecting the same, Ld. AO levied penalty u/s 270A(9)(a) at the rate of 200% which was worked out to be Rs. 663.03 Lacs. 6. The Ld. CIT(A) upheld the penalty on the ground that had the case not been scrutinized, the incorrect head of income as adopted by the assessee in the original return of income, would not have surfaced. The assessee's employer had deducted TDS u/s 192 on perquisite value and law clearly provide that ESOP was taxable as perquisites under the heard salaries in the year of exercise of option by th....