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TMI Blog2025 (3) TMI 400X X X X Extracts X X X X X X X X Extracts X X X X ..... DER] Thus as a law abiding citizen, he immediately included such interest in the total income in the return filed in response to notice u/s 148 of the Act and paid due tax along with interest thereon. All the series of events clearly establish that assessee has acted bonafidely and never attempted to under report any income.
Assessee should be granted immunity u/s 270AA of the Act and no penalty should be levied in the case of the assessee for under reporting of income u/s 270A of the Act. It is further seen that neither in the assessment order nor in the penalty order, the AO has recorded the satisfaction that as to which specific circumstances or instances as provided in clause (a) to (g) of sub-section 2 of section 270A by virtue of which, the income of the assessee could be held as under reported is invoked. Nor the same was not communicated to the assessee so as to allow him an opportunity to explain his case. Under these circumstances, the entire penalty proceedings are invalid and, thus, untenable in the eye of law. Accordingly, the penalty levied u/s 270A is hereby deleted. Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... n tax paid erroneously, after receipt of notice, on income which is exempt u/s 10(37) of the Act." 4. Before us, the Ld. AR of the assessee argued that the assessee is an illiterate agriculturist and his agricultural land was acquired by the State Government under compulsory acquisition way back. During the year under appeal, assessee has received interest of Rs. 9,88,58,400/- as enhanced the compensation which was offered for tax in the return of income filed u/s 139(1) of the Act after claiming deduction for expenses @ 50% as provided u/s 57(iv) of the Act. Thereafter, on the advice of some counsel, and relying upon the judgment of the Hon'ble Supreme Court in the case of Ghanshyam (HUF) (supra) the assessee claimed the interest income on enhanced compensation as exempted in the revised return filed. The Ld. AR submitted that when the assessee received the notice u/s 148 of the Act, it was advised to the assessee that the law has now been settled against the assessee in view of the recent judgment of Hon'ble Supreme Court in the case of Mahender Pal Narang (supra), therefore, assessee being a law abiding citizen of the country has declared the interest of enhanced of compensatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urender Vs ITO Ward 4(3), Gurgaon in ITA No. 7589/Del/2018: A.Y. 2013-14, date of judgment 27.04.2020. iii) Jagmal Singh Vs ITO Ward 2(2), Gurgaon in ITA no. 2340/Del/2018; A.Y 2013-14, date of judgment 20.09.2018. iv) Ramkishan Vs ITO Ward 60(5), New Delhi in ITA no. 5391/Del/2017; Α.Υ. 2014-15, date of judgment 02.12.2020. v) Amarchand Gupta and others Vs ITOs (a bunch of thirteen appeals), New Delhi in ITA no.5367/Del/22018; date of judgment 14.08.2019. vi) ITO Ward 2 Rewari Vs Manish Yadav in ITA No.3836/Del/2016; Α.Υ.2012-13, date of judgment 09.08.2019. He, therefore, prayed that even on merits also, no penalty u/s 270A could be levied in the case of the assessee. 6. Per contra, the Ld. SR. DR vehemently supported the orders of the lower authorities and submit that in the instant case, assessee has revised the return of income and claim the refund of the tax paid on the interest on enhanced compensation in the return filed u/s 139(1). If the re-assessment proceeding u/s 148 of the Act were not be initiated, assessee would not declare such interest and paid tax thereon. It is only after the notice u/s 148 of the Act, the assessee has offer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case, it is seen that assessee has originally declared the interest on enhanced the compensation in the return filed u/s 139 of the Act and paid the due taxes thereon. Thereafter, based on some legal advise and by placing reliance upon the judgment of the Hon'ble Supreme Court in the case of Ghanshayam (HUF) (supra), the assessee claimed such interest as exempt u/s 10(37) of the Act. The assessee also placed reliance upon certain judgments of various benches of the Tribunal wherein it is held that interest received on enhanced compensation is exempt u/s 10(37) of the Act. When the assessee received the notices u/s 148 of the Act and also after obtaining legal advise, it was came to his notice that law has been changed in view of the judgment of Hon'ble Supreme Court in the case Mahender Pal Narang (supra). Thus as a law abiding citizen, he immediately included such interest in the total income in the return filed in response to notice u/s 148 of the Act and paid due tax along with interest thereon. All the series of events clearly establish that assessee has acted bonafidely and never attempted to under report any income. Here, we also find that the immunity granted u/s 270AA of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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