Penalty u/s 270A(9) deleted when assessee filed return u/s 148 and paid due taxes

Penalty u/s 270A(9) deleted by ITAT as assessee pursuant to notice u/s 148 filed return and had paid due taxes

In a recent judgment, ITAT Ahmedabad has deleted penalty u/s 270A(9) when assessee pursuant to notice u/s 148 filed return and paid due taxes.

ABCAUS Case Law Citation:
4395 (2025) (01) abcaus.in ITAT

In the instant case, the assessee had challenged the order passed by the Commissioner of Income Tax (Appeal)/National Faceless Appeal Centre (NFAC) in confirming the penalty levied u/s 270A(9) of the Income Tax Act, 1961 (the Act).

The appellant assessee had not filed his return of income for AY 2018-19. The assessee was a salaried person working in a reputed Public Ltd Company. The assessee had been credited substantial amount as salary as reflected from TDS statements u/s192 during the Financial Year.

The assessee was issued show-cause as to why a notice u/s 148 should not be issued on the basis of information which suggested that income chargeable to tax had escaped assessment in his case for the relevant AY. Subsequently, notice u/s.148 was issued asking the assessee to file return against which the assessee filed return of income declaring his income and the assessment was completed accepting the return income.

However, owing to the non-filing of the return and short deduction of tax, the Assessing Officer initiated and levied penalty u/s 270A for mis-reporting of the income. The first appeal of the assessee was dismissed by the CIT(A).

Before the Tribunal, the assessee submitted that he had neither underreported nor misreported his income. That in response to notice u/s 148 the assessee had duly filed return of income and the taxes had been deducted by the employee on the regular salary however, the employer did not deduct TDS on the additional salary paid. It was submitted that having made aware of the short deduction of tax the assessee promptly paid taxes, rectified and filed the return, hence no penalty was leviable.

It was contended that the Original ITR could not be filed because of bonafide reasons and the assessee had disclosed and offered full income in ITR filed u/s 148 of the Act duly accepted by AO during assessment proceeding. Therefore, the provisions u/s 270A(9) of the Act were not at all attracted.

It was also submitted that in any event the assessee’s case was not at all falling under clause (a) to clause (f) of Sub section 9 of Section 270A and thus there is no question of misreporting of income.

On the other hand, Revenue argued that but for the notice issued u/s.148 the assessee could not have filed the return of income. Rebutting the argument of Revenue, the assessee submitted that when the return had been filed, the due taxes had been paid, no penalty was leviable. 

The Tribunal perused the provisions of section 270A(9) and opined that on going through the provisions of the Act, the factum of filing of return and payment of entire taxes and keeping in view the specific facts and circumstances of the instant case, no penalty u/s.270A for mis-reporting  of income was leviable in this case.

Accordingly, appeal of the assessee was allowed.

Download Full Judgment Click Here >>

• If assessee fails to explain source of purchases, estimating profit rate contrary to Section 69C
• Income Tax Department not trusted even upon its lawyers – SC slams ITD for delay
• Goods loaded in two trucks with one e-way bill stating both truck numbers – No evasion
• GOI makes four new Labour Codes  effective from 21st November 2025
• Provident fund dues have first charge over claim of bank under SARFAESI Act – SC