Vague Penalty Notice Invalid: ITAT Deletes 200% Penalty Under Section 270A

Institute of the Franciscan Vs ITO/ACIT (Exemptions) (ITAT Chennai) The assessee, a charitable trust, was subjected to penalty under section 270A at 200% arising from disallowance of donations. The appeal before the CIT(A) was dismissed on account of delay, and the matter reached the ITAT. Before the Tribunal, the assessee raised a crucial legal ground that the penalty notice did not specify the exact limb—whether the proceedings were initiated for “underreporting of income” or “misreporting of income.” The ITAT accepted this contention and held that section 270A clearly contemplates...