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TMI Blog2024 (8) TMI 917X X X X Extracts X X X X X X X X Extracts X X X X ..... wn value (WDV) under the Income-tax Act by the auditors in their tax audit report u/s 44AB of the Act. Both the accounts and the said report were submitted with the return of income. The learned First Appellate Authority in the impugned order has discussed the issue elaborately and in deleting the penalty levied u/s 270A of the Act has relied on the ratio of decision of Prem Brothers Infrastructure LLP[ 2022 (6) TMI 130 - DELHI HIGH COURT] - DR has not been able to prove the case of assessee on different footing. Thus, no infirmity. It is well said to error is human a bona fide error cannot be basis of imposition of penalty - Thus, impugned action of the CIT(Appeals) is justified in deleting the impugned penalty, same is hereby affirmed - D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee accepted the inadvertent mistake stating that the opening WDV for AY 2017-18 was inadvertently taken as per the book value of the asset rather than the closing WDV for AY 2016-17. Assessee also offered the excess depreciation claimed by it for taxation. Accordingly, the assessment was completed u/s 143(3) on 12/12/2019 assessing total income of Rs. 385,08,72,140/- by adding Rs. 1,63,21,921/- to the returned income of Rs. 383,45,50,210/-. The AO also initiated penalty proceedings u/s 271A of the Act for underreporting in consequence of misreporting of income to the extent of Rs. 1,63,21,921/-. In penalty proceedings the Assessing Officer, rejecting the explanation furnished on behalf of the assessee, vide order dated 02.09.2021 levi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce as out of the two correct WDVs under the two different Acts, one instead of the other was got picked up due to clerical oversight. He submitted that all material facts were on record before the Assessing Officer. He submitted that assessee had also deposited advance income-tax on the income assessed even after the addition. As per the assessment order itself, the assessee has been granted a refund of Rs 1.88 crores and there was no mala fide intention on the part of the assessee to underreport any income u/s 270A of the Act as the substantial advance-tax had been deposited and even after the addition, still the assessee is entitled to refund. He submitted that the Assessing Officer has levied penalty in question solely on the ground tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng substantial taxes over the years. On considering the totality of facts, I am inclined to concur with the view that this cannot be a case of deliberate under reporting of income on part of the appellant. 6.2 Furthermore, I also note that the appellant has been consistent in offering explanation with regard to the said inadvertent error in computing the depreciation admissible under the provisions of Income Tax Act; in the course of assessment proceedings, penalty proceedings as also during the appellate proceedings. I find that the explanation offered by the appellant, having regard to the nature and quantum of the income alleged to be under reported, is bona fide within the meaning of sub-section (6) of section 270A, and the appellant ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t and material fact in respect of the alleged under reporting of income, i.e. the correct figure of opening WDV was available both with the Department and the appellant. Rather, it was not even possible for the appellant to misrepresent or suppress this relevant and material fact. Therefore, I find that by no stretch of imagination this case would fall under clause (a) of sub-section (9) of section 270A, as there was clearly no misrepresentation or suppression of facts. It is further noted that the other clauses, i.e. clause (b) to clause (f) of sub-section (9) of section 270A, are also not applicable to the facts of the present case. 6.4 Hon'ble High Court of Rajasthan in the case of Chambal Fertilizers and Chemicals Ltd. Vs Pr. CIT (2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sreporting of income, however, fact that assessee had furnished all details of transactions relating to disallowance made under section 14A and Assessing Officer as well as assessee had used same details to arrive at different quantum of disallowances, this by no stretch of imagination could be held to be 'misreporting' and further, in absence of details as to which limb of section 270A was attracted, impugned penalty order was to be quashed and revenue was to be directed to grant immunity under section 270AA. 7. In view of the facts and circumstances of the case, and the prevailing position of law, I find that this is a not a case of under-reporting or misreporting of income, within the meaning of section 270A of the Act. The alleg ..... X X X X Extracts X X X X X X X X Extracts X X X X
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