ITO Vs Om Minerals (ITAT Delhi)
ITAT Delhi held that penalty under section 270A of the Income Tax Act not leviable since income assessed and income processed are same. Accordingly, in absence of under reporting of income, no penalty can be levied.
Facts- The case of the assessee was selected for scrutiny. During the assessment proceedings, the AO noted from the Audit report that the payments towards interest on R&R charges; interest on royalty; mines and geology charges and R&R charges were not made before the due date for furnishing the return of income of the previous year u/s 139(1) of the I.T. Act.
Thus, AO disallowed the amount of Rs.3,64,90,350/- u/s 43B of the Act and levied penalty u/s 270A of the Act for under reported income which was in consequence of misreporting thereof of the disallowances made u/s 43B of the Act.
CIT(A) deleted the penalty levied. Being aggrieved, revenue has preferred the present appeal.
Conclusion- Held that as per provision of section 270A(2)(a), a person shall be considered to have under reported his income if the income assessed is greater than the income determined in the retuned processed under clause (a) of sub section (1) of section 143; however in the present case, there is no under reporting of income as income assessed u/s 143(3) of the I.T. Act and income determined in return processed u/s 143(1)(a) are same. It was held that in the light of aforesaid discussion and in view of provisions of section 270A(2)(a) of Income Tax Act, this is not a case where appellant has under reported its income and in absence of under reporting of income, penalty cannot be levied u/s 270A of I.T. Act.
