Penalty U/s 270A Quashed – Failure to Specify ‘Misreporting Limb’ in Notice Held Fatal

Mehul Ratilal Shah Vs DCIT (ITAT Bangalore) The Bangalore ITAT in the case of Mehul Ratilal Shah dealt with levy of penalty u/s 270A (₹32.24 lakh) arising from additional income offered during assessment based on Form 64C (AIF income reconciliation). Although the assessee had: Voluntarily revised computation during scrutiny, Paid taxes on additional income,the AO treated the case as “misreporting of income” and levied 200% penalty. The Tribunal, however, did not go into merits and instead focused on a fundamental legal defect: The show cause notice and assessment order did not specify...