Sagar Subhash Wedhane Vs ITO (ITAT Pune)
In the case of Sagar Subhash Wedhane vs. ITO, the Income Tax Appellate Tribunal (ITAT) Pune allowed the assessee’s appeal against a penalty of ₹1,61,548 levied under Section 270A(9)(a) of the Income Tax Act, 1961 for the Assessment Year 2018–19. The assessee, an employee of Bosch Limited, had originally filed his income tax return through a tax consultant, Mr. Kishor Patil, who allegedly filed inflated deduction claims under Chapter VI-A without the assessee’s knowledge. After reassessment proceedings under Section 147/148, a revised return was filed voluntarily by the assessee, declaring correct income and paying applicable taxes with interest.
The penalty was initiated by the Assessing Officer on the grounds of under-reporting of income due to misreporting. However, the ITAT noted that the penalty notice issued under Section 270A did not specify the exact limb or clause of misreporting from sub-section (9), which lists various types of misreporting such as misrepresentation of facts or false entries. This lack of specificity in the penalty notice, according to the Tribunal, denied the assessee the opportunity to properly respond and defend his case. The Tribunal also considered the assessee’s explanation that he had fully relied on the tax consultant and was unaware of the inaccurate deductions, which had also affected multiple employees who filed a complaint with the Economic Offences Wing.
