Rahul Saunik Vs ITO (ITAT Mumbai)
The assessee was subjected to penalty under Section 270A for alleged under-reporting of income, based on an addition of ₹62.09 lakh made in reassessment proceedings. However, in quantum appeal, the CIT(A) deleted the entire addition, holding that salary income was already disclosed and subjected to TDS, and property payment was not income.
The ITAT held that penalty proceedings are purely consequential and cannot survive once the underlying addition is deleted. Since the assessed income after appellate relief matched the returned income, the basic condition of “under-reporting” under Section 270A failed.
The Tribunal also noted that the income was already within the department’s knowledge through Form 26AS and TDS records, negating any allegation of concealment.
Accordingly, the penalty of ₹8.69 lakh was deleted, and the assessee’s appeal was allowed.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
The present appeal is directed against the order passed by the Learned Commissioner of Income-tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as “CIT(A)”] dated 06.11.2025 under section 250 of the Income-tax Act, 1961[hereinafter referred to as “the Act”], arising out of the penalty order passed under section 270A of the Act dated 22.09.2022 for the Assessment Year 2017–18.The penalty proceedings emanate from the assessment order passed by the Assessing Officer under section 147 read with section 144 and section 144B of the Act dated 29.03.2022.
