AO can’t take two different stands on immunity u/s 270AA(2) for a same transaction

Immunity u/s 270AA(2) in respect of a single transaction can not be denied to one assessee when the penalty was dropped for other assessee.

In a recent judgment, ITAT has allowed immunity from penalty u/s 270A to the assessee for not declaring capital gain on property observing that Assessing Officer is not permitted to take two different stands on the same issue arising from the same transaction as well as same facts and circumstances.

ABCAUS Case Law Citation:
5234 (2026) (09) abacus.in ITAT

In the instant case, the assessee along with the co-owner had sold a property during the year and earned the income under the Head “Capital Gain”.

Though the capital gain was not declared by the assessee in the original return and in the case of co-owner as well and in response to notice under section 148, the assessee declared the said income of capital gain arising from the sale of the property which was accepted by the Assessing Officer while passing the re-assessment order.

The assessee filed an application under section 270AA(2) of the Act seeking immunity from levy of penalty in Form No. 68.

Despite the application in Form-68 filed, the Assessing Officer levied the penalty under section 270A of the Act without considering the same. In the case of the co-owner, the Assessing Officer had dropped the penalty proceedings under section 270A.

The CIT(A) confirmed the order passed u/sec.270A.

The Tribunal observed that the Assessing Officer is not permitted to take two different stands on the same issue arising from the same transaction as well as same facts and circumstances. Once penalty proceeding under section 270A of the Act has been dropped by considering the application filed by the co-owner in Form 68 then, the penalty levied by the Assessing Officer in the case of the assessee despite the application in Form 68 is not justified and the same is liable to be deleted.

Accordingly, the Tribunal deleted the penalty levied by the Assessing Officer under section 270A of the Act.

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