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TMI Blog2023 (5) TMI 1262X X X X Extracts X X X X X X X X Extracts X X X X ..... ue of house property. The assessee had also accepted assessment of interest income under the head income from other source. During penalty proceedings, the assessee explained before the AO that said mistake is on account of inadvertent error committed by an Accountant. We find that, if you go through income on which the AO levied penalty u/s. 270A of the Act, on annual value of house property, the Accountant who filed return of income has committed inadvertent error and reported only ALV of Rs. 5,40,000/- instead of Rs. 8,40,000/- and in our considered view said mistake cannot be considered as under reporting of income for levying of penalty u/s. 270A of the Act. In respect of assessment of interest income under the head business, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 51,78,140/-. The case was selected for scrutiny and during the course of assessment proceedings, the AO noticed that the assessee has adopted annual value of house property at Rs. 5,40,000/-, instead of Rs. 8,40,000/- in the revised return filed for the relevant assessment year and therefore, called upon the assessee to explain as to why difference should not be added under the head income from house property. In response, the assessee submitted that the Accountant who filed the return has adopted incorrect figure while computing annual value of house property and thus, requested the AO to consider the difference amount as income of the assessee under the head income from house property. The assessee had also accepted interest income at Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income under the head other sources. Therefore, it cannot be said that the assessee has under reported his income by misreporting income which warrants penalty u/s. 270A of the Act. 4. The ld. DR, supporting the order of the ld. CIT(A) submitted that as per the provisions of section 270A of the Act, if assessed income is more than the amount of returned income, then penalty is leviable u/s. 270A of the Act. In case the assessee accepted additional income, then it can avail immunity provided u/s. 270AA of the Act. Since, the assessee has misreported his income, the AO has rightly levied penalty and their order should be upheld. 5. We have heard both the parties, perused materials available on record and gone through orders of the autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he was on a bonafide belief that said income is assessable under the head income from business. In our considered view, when the assessee has explained that there is a bonafied mistake in offering interest income under the head income from business and also there is no difference in tax when it was offered under the head income from other source and income from business, in our considered view, there is no reason for the AO to levy penalty u/s. 270A of the Act, for under reporting of income. Thus, we delete penalty levied u/s. 270A of the Act towards under reporting of income in respect of annual value of house property and also assessment of interest income under the head income from other sources. 6. In the result, appeal filed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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