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TMI Blog2025 (1) TMI 763X X X X Extracts X X X X X X X X Extracts X X X X ..... y proceeding by the Ld. AO for misreporting of income without reference to any clause of sub-section (9) of section 270A was bad in law. The Ld. CIT(A) ought not to have confirmed the invalid penalty order passed by the Ld. AO. 3. For that on the facts and circumstances and legal position of the case, the Ld. CIT(A) ought to have cancelled the Penalty Order passed by the Ld. AO on the basis of invalid show cause notice u/s 274 of the Act. 4. For that on the facts and circumstances and legal position of the case, the Ld. AO ought not to have levied the penalty as the assessee had paid the demand tax within the due date and had applied for immunity from imposition of penalty u/s 270AA. The Ld. CIT(A) ought not to have confirmed the penalty order of the Ld. AO without considering the fact on record. 5. For that on the facts and circumstances and legal position of the case, the Ld. AO ought not to have rejected the application of the assessee u/s 270AA made in plain paper and not in Form No. 68 due to the ignorance of the assessee about the provisions of law. The Ld. CIT(A) ought not to have confirmed the penalty order of the Ld. AO on mere technical ground as above. 6. For tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p to 18.06.2017 in which out of total receipts, a sum of Rs. 5,75,870/- had been received through banking channel on which profit @ 6% was considered and the balance amount of Rs. 31,77,700/- had been received in cash, on which profit @ 8% was considered and total profit of Rs. 2,88,769/- had been declared under the provisions of Section 44AD of the Act from the business of trading in fruits. On receiving the reply, the Ld. AO did not propose any variation to the income shown in the return filed in response to the notice u/s 148 of the Act dated 06.07.2022 and the assessment was made at the returned income at Rs. 2,88,769/-. 3.2 At the same time, since the assessee had filed the return of income after issue of notice u/s 148 of the Act, penalty proceedings u/s 270A of the Act were initiated. The assessee requested before the Ld. AO in the course of the penalty proceedings that the penalty may be waived off in view of Section 270AA of the Act as no appeal had been filed. The Ld. AO issued a letter on 08.08.2023 and another on 14.08.2023 for submission of the reply and relevant documents, the contents of which are as follows: "3. As can be observed from your reply that you have no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rm 68 to get immunity from imposition of penalty u/s 270AA although he had paid the tax within the due date and had filed prayer for waiver within one month from the end of the month in which the penalty order was passed. The contention of the appellant cannot be accepted for the reason that for granting immunity from imposition of penalty u/s 270A, application shall be made in Form 68. In this connection, attention is drawn to the provisions of Rule 129, Income Tax Rules, 1962 which are reproduced hereunder: "[Form of application under section 270AA. 129. An application to the Assessing Officer to grant immunity from imposition of penalty under section 270A and from initiation of proceedings under section 276C or section 276CC shall be made in Form No. 68.]" Mere submission of appellant in writing instead of Form 68 cannot be reason for granting immunity from penalty u/s 270A. Since the appellant has not filed the requisite application for waiving of penalty as per provision of Section 270AA, the AO hence rightly levied penalty u/s 270A and hence the penalty levied by the AO is upheld. Accordingly, the grounds raised by the appellant in this context are dismissed. 5.3. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of penalty under section 270A and initiation of proceedings under section 276C or section 276CC, if he fulfils the following conditions, namely:- (a) the tax and interest payable as per the order of assessment or reassessment under sub-section (3) of section 143 or section 147, as the case may be, has been paid within the period specified in such notice of demand; and (b) no appeal against the order referred to in clause (a) has been filed. (2) An application referred to in sub-section (1) shall be made within one month from the end of the month in which the order referred to in clause (a) of sub-section (1) has been received and shall be made in such form and verified in such manner as may be prescribed. (3) The Assessing Officer shall, subject to fulfilment of the conditions specified in sub-section (1) and after the expiry of the period of filing the appeal as specified in clause (b) of sub-section (2) of section 249, grant immunity from imposition of penalty under section 270A and initiation of proceedings under section 276C or section 276CC, where the proceedings for penalty under section 270A has not been initiated under the circumstances referred to in sub-section ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase of under reporting of income in the first place. Sub-section (6) of section 270A also excludes cases of under-reported income where the assessee's explanation is found to be bona fide. Since the Ld. CIT(A) has gone by the procedural requirement while the assessee had duly complied with the substantive requirement, and neither in the order of the Ld. AO nor in the order of the Ld. CIT(A) a case of mis-reporting of income has been made out and higher amount of penalty has been imposed, hence, in view of the totality of facts and circumstances of the case, it would be in the interest of justice if the order of the Ld. CIT(A) is set aside and the issue is remitted back to the file of Ld. CIT(A) to decide whether filing of Form 68 could be dispensed with and immunity could be granted when the assessee had paid the taxes, not further contested the order of the Ld. AO and had applied for immunity from imposing of penalty on plain paper. He shall also pass a speaking order as to whether it is a case of mis-reporting of income and which of the clauses of section 270A(9) of the Act, if any is attracted for arriving at his decision. The assessee shall file all necessary evidence before th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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