Bajrang Lal Jangir vs. ACIT

Parties Involved

Facts Summary

The facts on record reveal that penalty u/s 270A of the Act was imposed on the addition of Rs.26,90,509/- made to the income of the assessee on account of alleged undisclosed income by way of rent earned from letting out of property. Ld. Counsel for the assessee submitted before me that the appeal of the assessee in the quantum proceedings against the order passed by the AO making the aforesaid addition was pending for adjudication. Since the Ld. CIT(A) has not adjudicated the quantum appeal of the assessee itself, his adjudication of the penalty order passed by the AO is nothing but pre-mature. When the charge for the levy of penalty i.e. underreporting/misreporting of income has itself not been decided in appeal by the Ld. CIT(A), how could he have adjudicated on the levy of penalty with regard to the same.…

Legal Issues

• 1. The Ld. CIT(A) has erred on facts and in law in not appreciating that when addition is made by AO u/s 68 r.w.s. 115BBE of the Act, initiation & imposition of penalty u/s 270A of the Act is illegal, bad in law and be quashed.
• 2. The Ld. CIT(A) has erred on facts and in law in upholding the validity of initiation of penalty proceedings in as much as penalty proceeding u/s 270A is initiated for misreporting/underreporting of income without specifying whether it is for under-reporting of income OR for misreporting of income and thus proceedings are void ab-initio.
• 3. The Ld. CIT(A) has erred on facts and in law in confirming the levy of penalty of Rs.26,90,509/- u/s 270A of IT Act, 1961 for under-reporting of income.

Judgment Outcome

Decided in favour of Assessee.

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