Apex Detonators Pvt. Ltd. Vs ACIT (ITAT, Nagpur Bench)
Form 26AS May Expose the Income, But It Does Not File the Return: ITAT Restores Penalty u/s 270A Over Incorrect Tax Computation & Lack of Opportunity
Facts of the Case
The assessee, Apex Detonators Pvt. Ltd., was a private limited company which did not furnish its regular return of income for AY 2019-20.
Information available in Form 26AS revealed that the assessee had received interest income of ₹8,62,624 from The Saraswat Co-operative Bank Ltd. Tax of ₹86,263 had also been deducted at source from the interest payment.
Since no return had been filed despite the reported financial transaction, the AO reopened the assessment by issuing notice u/s 148. During the reassessment proceedings, the assessee failed to make proper compliance or furnish the necessary explanation.
In the absence of any response, the AO treated the entire interest receipt of ₹8,62,624 as the assessee’s total income. The AO also initiated penalty proceedings u/s 270A for under-reporting of income.
The assessee once again failed to respond to the notices issued during the penalty proceedings. The AO consequently levied penalty at 50% of the tax payable on the under-reported income. The tax on the under-reported income was computed at ₹2,69,137, resulting in a penalty of ₹1,34,568 u/s 270A.
