Penalty u/s 270A of the Act for underreporting of income as a consequence of misreporting levied at 200% of the tax payable deleted by Hon’ble Mumbai Income Tax Appellate Tribunal. While deciding the case, the Hon’ble Tribunal has taken note of the arguments that the penalty u/s 270A of the Act is discretionary and not automatic/mandatory in nature and that there has to be an element of mens rea (malafide intention) for levy of penalty.
Thereafter, the Hon’ble Tribunal has deleted the penalty levied u/s 270A on the ground that penalty levied for misreporting of income without specifying in the order which of the relevant clause of sub section 9 of s. 270A of the Act is attracted, suffers from the vice of non application of mind and violation of principles of natural justice.