Section 271AAC of the Income Tax Act pertains to the penalty for under-reporting and misreporting of income. It imposes a penalty on taxpayers who have deliberately under-reported or misreported their income to evade tax liabilities. The section specifies the amount of penalty and provides guidelines on the imposition and calculation of the penalty. Understanding Section 271AAC is crucial for taxpayers to accurately report their income and comply with tax regulations to avoid penalties and legal consequences. This description provides an overview of Section 271AAC and its implications for under-reporting and misreporting of income under the Income Tax Act.
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The Tribunal held that reopening based solely on Insight Portal inputs without independent application of mind is invalid. Since the reassessment itself failed, the addition of share LTCG as unexplained income under section 68 could not survive.
The Tribunal found that additions under section 69A were made without examining evidence due to non-compliance. The matter was remanded to allow verification of claimed trading and agricultural receipts.
The issue was whether cash deposited during demonetisation was fully explainable from business receipts. ITAT held that explanations were partly unreliable and sustained 50% of the addition under Section 68.
The High Court held that issuing a draft assessment order under Section 144C is invalid where the Transfer Pricing Officer proposes no variation. The key takeaway is that absence of TP adjustment means the assessee is not an “eligible assessee,” making DRP proceedings without jurisdiction.
Cash deposits were rightly taxed as unexplained money when the assessee failed to discharge the primary burden of proof. Absence of contemporaneous evidence defeats claims of redeposit of cash.
The Revenue invoked section 115BBE based on cash found during proceedings. However, the Tribunal found the foundational approval under section 153D defective. The entire assessment was therefore quashed.
The ITAT held that additions based on incorrect and unreconciled bank data cannot be sustained. The assessment was remanded for fresh verification of actual cash deposits and credits.
The Tribunal held that cash deposits arising from recorded pharmacy sales during demonetisation cannot be added under section 68 when turnover is accepted and duly taxed.
ITAT held that reassessment proceedings are invalid where the Assessing Officer failed to grant the minimum seven days’ time under section 148A(b), making the entire process unsustainable.
The Tribunal held that since the foundational notice for reassessment was invalid, the penalty imposed under Section 271AAC could not stand and was quashed.
