Sunil Chunilal Kumavat Vs ITO (ITAT Pune)
The Income Tax Appellate Tribunal (ITAT) Pune Bench has overturned penalties levied against Sunil Chunilal Kumavat for the assessment years 2016-17, 2017-18, and 2018-19. These penalties, imposed under Section 271(1)(c) and Section 270A of the Income Tax Act, 1961, stemmed from alleged bogus claims for Section 80C deductions.
For the Assessment Year 2016-17, the Assessing Officer’s (AO) order stated the assessee furnished “inaccurate particulars of income,” but the National Faceless Appeal Centre (NFAC) order indicated “concealment of taxable income.” The ITAT, citing the Bombay High Court’s decision in Mohd. Farhan A. Shaikh vs. ACIT [2021] 434 ITR (1) (Bom.), ruled that such a deviation between the “limbs” of concealment and furnishing inaccurate particulars is legally unsustainable. Consequently, the penalty of Rs. 93,900/- was deleted.
For Assessment Years 2017-18 and 2018-19, penalties of Rs. 1,18,464/- and Rs. 1,61,360/- respectively, were levied at 200% under Section 270A(8). However, the lower authorities failed to specify which corresponding limb of “under-reporting of income in consequence of any mis-reporting” (clauses (a) to (f) of sub-section (9) of Section 270A) was applicable. Adopting a strict interpretation, as per the Supreme Court’s ruling in Commissioner of Customs (Imports), Mumbai vs. Dilip Kumar And Co. & Ors. [2018] 9 SCC 1 (SC) (FB), the ITAT deleted these penalties as well.
