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TMI Blog2024 (8) TMI 1233X X X X Extracts X X X X X X X X Extracts X X X X ..... r and deposited with the government exchequer on behalf of the assessee which was also reflecting in the record of the department. Accordingly, there was no loss to the revenue as far as the tax liability is concerned. The provisions of clause (a) of sub-section 6 of section 270A provides that there will not be any under reporting of income if the assessee furnish explanation with respect to the income and discloses all the material facts regarding such income and the AO is satisfied that the explanation offered is bona fide. In the present case, the income of the assessee was subject to TDS and almost entire tax liability was already paid by way of TDS and the same was duly reflecting in the record of the department. Hence there was no rea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s 139 of the Act for the year under consideration. As such, the assessee disclosed the income under the head salary in response to the notices issued u/s 148 of the Act by furnishing form 16. Likewise, the AO during the assessment proceedings found that the assessee has claimed excessive deduction in Form 16 u/s 24 of the Act for Rs. 74,951/- representing the interest on housing loan, which was added to the total income of the assessee. As such, the income was determined in the assessment framed u/s 147 of the Act at Rs. 58,70,680/- only. As the assessee did not file original return of income, the AO initiated penalty proceedings for underreporting of income, which came to be confirmed at Rs. 8,16,895/- being 50% of the amount of tax sou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he disallowance of ₹ 74,951/-under section 24 of the Act representing the excessive interest claimed by the assessee. As per the AO, the income assessed under section 147 r.w.s. 144 of the Act represents the underreporting of income in pursuance to the provisions of section 270A(2) of the Act. Accordingly, the AO proposed to levy the penalty under section 270A of the Act on account of underreporting of income by issuing a show cause notice under section 274 of the Act. The assessee in response to show cause notice submitted that he has been filing the return of income under section 139 of the Act regularly for the last many years. Even for the year under consideration, the assessee claimed having been given the necessary details to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso reflecting in the record of the department. Accordingly, there was no loss to the revenue as far as the tax liability is concerned. The provisions of clause (a) of subsection 6 of section 270A of the Act provides that there will not be any under reporting of income if the assessee furnish explanation with respect to the income and discloses all the material facts regarding such income and the AO is satisfied that the explanation offered is bona fide. In the present case, the income of the assessee was subject to TDS and almost entire tax liability was already paid by way of TDS and the same was duly reflecting in the record of the department. Hence there was no reason for the assessee to underreport his income by not furnishing return o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relating to under reporting of income . Therefore, since the assessee's case does not fall under sub-Section (2) of Section 270A, then the benefit of sub- Section (6) to Section 270A is also not available to the assessee. Therefore, the next issue for consideration is whether the assessee's case is one of misreporting of income and whether the case of assessee falls specifically under sub-Section (a) to Section 9 dealing with misrepresentation or suppression of facts . Further, since sub- Section (a) to Section 270A specifically provides that notwithstanding anything content in sub-Section (6) , where underreported income is in consequence of misreporting thereof by any person, the penalty shall be equal to 200% of the amount of tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppression of facts. However, once the sale consideration is reported in Form No. 26AS on the Government website and the amount of sale consideration has not been challenged / disputed by the Department and taxes has been withheld on such sale consideration by the purchaser of property under Section 194-IA of the Act, then, in our view, this is not case of misrepresentation or suppression of facts. In the instant case, the assessee was under a bona fide believe that once the correct income flowing from sale of property is duly reflecting in Form No. 26AS on the Government website and taxes have been deducted at source by the purchaser of such property under Section 194-IA of the Act, the assessee was under no further obligation to file retur ..... X X X X Extracts X X X X X X X X Extracts X X X X
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