The assessee failed to file the original return of income, and ...

Penalty for Underreported Income Overturned Due to Bona Fide Belief and Full TDS Coverage; Appeal Allowed.

August 28, 2024

Case Laws Income Tax AT

The assessee failed to file the original return of income, and the Assessing Officer initiated penalty proceedings for underreporting income. The assessee's authorized representative contended that all due taxes on salary income were deducted by the employer, leading to a bona fide belief of not underreporting income. The Tribunal held that since the income was subject to tax deducted at source (TDS) and the entire tax liability was paid through TDS, there was no loss to revenue. The provisions of Section 270A(6)(a) exempt underreporting if the assessee discloses material facts and the explanation is bona fide. The assessee's failure to file the return was due to a bona fide belief, as the income was subject to TDS reflected in the department's records. Regarding the addition, the assessee claimed a higher deduction u/s 24 due to a bona fide belief. Consequently, no penalty u/s 270A shall be levied for underreporting income, and the assessee's appeal is allowed.

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The assessee failed to file the original return of income, and ...

Penalty for Underreported Income Overturned Due to Bona Fide Belief and Full TDS Coverage; Appeal Allowed.

August 28, 2024

Case Laws Income Tax AT

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