Siddharth Laxmikant Vaderkar Vs ITO (ITAT Ahmedabad)
The Ahmedabad ITAT allowed the assessee’s appeal against the CIT(A), NFAC order dated 06.01.2026, concerning Assessment Year 2019-20 and deleted the penalty of ₹97,362 levied under Section 270A of the Income-tax Act, 1961. The assessee had filed the return declaring total income of ₹4,12,060 and claimed a ₹3,00,000 deduction under Section 80GGC for a donation made to “Rashtriya Samajwadi Party (Secular)”.
The assessment was subsequently reopened under Section 147, and the Assessing Officer, by reassessment order dated 10.12.2024, disallowed the deduction on the allegation that the donation was bogus. Penalty proceedings under Section 270A were then initiated on the ground of under-reporting of income in consequence of misreporting. The assessee maintained during penalty proceedings that the donation was genuine and supported by documentary evidence, but stated that it had not challenged the reassessment to avoid prolonged litigation and buy peace.
The Assessing Officer nevertheless levied penalty at 200% of the tax payable, amounting to ₹97,362, by order dated 27.06.2025. The CIT(A) dismissed the assessee’s appeal. Before the ITAT, both parties submitted that the issue was covered by the Tribunal’s decision in Hiro Mulchand Tanwani Vs. ITO dated 15.05.2026. In that decision, the Tribunal held that failure to appeal against a quantum addition does not by itself establish misreporting. It distinguished between under-reporting and misreporting under Section 270A and observed that misreporting requires circumstances specified in Section 270A(9), including misrepresentation or suppression of facts, unsupported expenditure claims, false entries or failure to report receipts.
