TMI Blog2023 (10) TMI 1276X X X X Extracts X X X X X X X X Extracts X X X X ..... income was exempt from tax on ground of principle of mutuality and therefore in its original return it claimed the same as exempt. As soon as the assessee became aware that the said income is taxable, it opted for DTVSV Scheme and revised its return offering the said income to tax and paid tax which has not been disputed by the Revenue. It may be emphasised that the fact of earning the impugned interest and miscellaneous income has duly been disclosed in its accounts and in the original return with full details. However, due to ongoing litigation about the taxability of the said income and misconception of law, the assessee claimed it as exempt. Nonetheless, the fact remains that the assessee filed revised return, offered the said income to tax during the course of assessment proceedings itself. As following the decisions in Prem Brothers Infrastructure LLP [ 2022 (6) TMI 130 - DELHI HIGH COURT ] and Alrameez Construction (P) Ltd. [ 2023 (8) TMI 371 - ITAT MUMBAI ] we hold that the impugned penalty is not exigible which we hereby vacate. Decided in favour of assessee. - Dr. Brr Kumar, Accountant Member And Ms. Astha Chandra, Judicial Member For the Assessee : Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... craves leave and sanction of the Hon'ble ITAT to file additional evidence, if so, required for proper prosecution of the case, based on facts and circumstances, which has not been or could not be produced or filed before lower authorities either because proper and sufficient opportunity was not provided or because it was not solicited or its need was not appreciated. 3. Briefly stated, the assessee is a Society registered under the Society Registration Act, 1860 incorporated on 26.02.1987. It filed its return online on 30.10.2018 for AY 2018-19 declaring income at Rs. Nil. Its case was selected for scrutiny under CASS. Statutory notice(s) were issued / served upon the assessee in response to which requisite details were submitted. During assessment proceedings the Ld. AO observed that the assessee earned interest of Rs. 90,02,345/- during the year which it claimed as exempt. On query, the assessee vide submission dated 26.02.2021 stated that it had initially filed ITR with Nil income. Now the assessee is offering interest income for tax and filed revised computation. The assessee also stated that it has opted for DTVSV Scheme which was announced in the Budget 2020 as No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut as to whether addition made in the quantum proceedings actually represents under-reporting of income on the part of the assessee and whether it is a fit case to impose the penalty. The decision of Hon ble Supreme Court in Hindustan Steel vs. State of Orissa, 83 ITR 26 (SC) was relied upon. It was emphasised that the assessee surrendered and offered interest income after paying tax by filing revised return. Several decisions in support were cited. It was urged that the impugned penalty on account of under reporting of income in consequence of misreporting is unlawful and liable to be quashed. 7. On the issue raised by the assessee that notice of demand was prepared on 4.3.2022 and penalty order was passed on 15.3.2022, hence the penalty order is null void, the Ld. CIT(A) held that it was due to technical glitch or typographical error which shall not vitiate the proceedings. This view of the Ld. CIT(A) is not legally tenable. The order is followed by the demand notice and not the vice-versa. 7.1 The Ld. CIT(A) thereafter extracted the relevant portion of the provisions of section 270A and observed that the role of the Ld. AO is only to check whether there is under-reportin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s attracted. Placing reliance on the decision of Hon ble Delhi High Court in Prem Brothers Infrastructure LLP V. NFAC rendered on 31.05.2022 and the decision of Mumbai Tribunal in Alrameez Construction (P) Ltd. vs. CIT/NFAC, Delhi (2023) 152 taxmann. Com 382 (Mum.-Trib.) the Ld. AR submitted that if the penalty notice does not mention which limb of section 270A of the Act is attracted and how the ingredient of sub section (9) of section 270A is satisfied, mere reference to the word misreporting in the assessment order for imposition of penalty is manifestly arbitrary and deserves to be quashed. 13. The Ld. DR supported the order of the Ld. CIT(A) but could not bring to our notice any contrary decision. 14. We have given careful thought to the rival submission of the parties and perused the records. It s a matter of fact that the penalty notice issued by the Ld. AO (reproduced below) does not mention which limb of section 270A(9) of the Act is attracted. If that be so, the decisions (supra) in Prem Brothers Infrastructure LLP and Alrameez Construction (P) Ltd. squarely apply to the facts of the assessee s case. 15. Moreover, we are of the view that the case of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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