| Question And Answer | |
|---|---|
| Subject: | Levy of Penalty U/SEc. 270A(9) |
| Category: | Income-Tax |
| Querist: | prakash |
| Answered by: | Reply of the Expert is awaited; |
| Tags: | penalty |
| Date: | April 2, 2024 |
Assessee is an individual. Search U/Sec. 132 has been conducted on 4.11.2017. Assessee has not filed the Return of Income for A.Y. 2017-18 U/SEc. 139(1), however the time limit for furnishing the Return was 31.03.2018. Meanwhile the assessee has received the Notice U/Sec. 153A and therefore the assessee has filed the Return of income for A.Y. 2017-18 in response to Notice U/SEc. 153A on 25.03.2018 disclosing the income at Rs. 4750000.00 which included income for LTCG and STCG. The assessing officer has completed the assessment U/SEc. 153A r.w.s 143(3) by making an addition of 675000.00 on account of diffidence between the cost of house property disclosed in the Return of Income and value as per DVO as unexplained investment U/SEC. 69A. and initiated the penalty proceeding U/Sec. 270A(9) for under reporting of Income .
on Appeal filed by the appeal before CIT A, who has accepted the contention of the appellant that since difference of Rs. 675000 is less than 5% is is with in the tolerance limit and deleted the addition made . On receipt of CIT A order , A.O. has levied the penalty on the following ground :
A. Assessee has responded to penalty proceedings
B. Assessee has not raised any ground for initiation of Penalty proceedings U/Sec. 270A(9) of the Act
c. Assessee would not have disclosed this income if search action was not conducted at assessee.
hence AO levied the penalty U/SEc. 270A(9) under misreporting of income @200% on the entire income of Rs. 4750000.00 disclosed in the return of Income filed in response to Notice U/SEc. 153A
Whether action of A.O. is correct ? what reply assessee should give?
Reply of the Expert is awaited. Please check back later
Action of AO does not seems to be in tune with law. He should have imposed penalty for Under reporting and not for mis reporting .Strong casre for appeal.In most of the cases AOs impose misreporting so as to block Immunity that is available in under reporting cases.
The penalty under 270A is a quasi criminal proceedings and therefore higher degree of evidence is required to prove the guilt of the assessee . Mere addition/ disallowance does not automatically lead to penalty . Further under 270A(9) there are six offence which the AO has to prove beyond reasonable doubt. Therefore all the three ground raised in the query for charging the penalty is not a valid ground . The ITAT will struck down the penalty order . Being CA and practicing as an advocate , we regularly come across this type of matter .