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2023 (7) TMI 469 - ITAT DELHIPenalty u/s 270AA - undisclosed income - under reported income as per sub section (8) of Section 270AA - eligibility to immunity from imposition of penalty u/s 270AA - HELD THAT:- The provisions of section 270AA of the Act bring out the complete code in itself. It creates substantive right of immunity in favour of the assessee subject to certain conditions, lays down the procedure to be followed by the AO and attaches finality to the order passed by the AO.This section nowhere indicates that the power of granting immunity is available to the first appellate authority. In the case in hand it transpires that no application was filed before the AO and during the appellate proceedings, for the first time assessee had claimed that he was eligible for immunity from imposition of penalty u/s 270AA and CIT(A) determined the issue against the assessee holding that as the penalty proceedings were initiated u/s 270A(9) of the Act provisions of section 270AA are not applicable. CIT(A) also gave a finding that it was a case of under reporting of the income in the nature of misreporting, therefore, the case of assessee falls within the ambit of Section 270A(9) Thus Bench is of considered view that as AO has specifically invoked Section 270(9)(a) of the Act then by virtue of sub section (3) of Section 270AA of the Act, it has to be considered to be a case of under reported income in consequence of misreporting which creates liability of penalty equal to 200% of the amount of tax payable on under reported income as per sub section (8) of Section 270AA of the Act. Nothing has been portrayed in the form of grounds or argued that the case of assessee was of under reporting the income only and no misreporting was involved. In fact, if the merits are considered the case of Revenue against assessee is that he was maintaining two sets of books of accounts which were impounded during the course of survey proceedings and it was found that assessee has made out of books sales amounting upon which addition on gross profit @ 3.19% was made. That certainly amounts to under reporting of incoming consequence to misreporting by way of misrepresentation of facts. There is thus no force in the claim that penalty ought to have been levied at 50% of the additional tax payable as provided u/s 270A(7) of the Act. Decided against assessee.
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