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Judgment
PER KRINWANT SAHAY AM
Appeal in this case has been filed by the assessee against the order dated 28.11.2025 passed by the Ld. CIT(A)/ NFAC, Delhi for the A.Y. 2022-23. Ground of appeal is as under :-
“1.On the facts and in the circumstances of the case and in law the Ld. CIT(A) at NFAC, Delhi erred in confirming the penalty imposed by the Assessment Unit of the National Faceless Assessment Centre u/s 270A of the Act.”
During proceedings before us the Ld. Counsel of the assessee has filed a brief synopsis which is reproduced as under :-
rests. by Sec.271(1)(c) 4(b) Sec.271(1)(c) alsn ind underreporting figures during attaching levy fidely fully providing by the proceedings. Delhi High Infrastructure (2022) taxmann.com (Del) (copies enclosed). provides penalty being circumstances subject favourable
He also argued on the line of the arguments filed in the brief synopsis.
Per contra the ld. DR relied on the order of the AO and the Ld. CIT(A).
We have considered the findings given in the penalty order by the AO as well as in the appellate order passed by the Ld. CIT(A). We find that in this case penalty u/s.270A has been imposed by the AO on the differences of estimated income suo-moto declared / brought on record by the assessee. The Ld. CIT(A) has also confirmed the same.
During proceedings before us the Ld. Counsel of the assessee argued that the income declared by the assessee has been accepted by the revenue and there is no enhancement / reduction by the revenue in the income of the assessee during assessment proceedings. It is the assessee who has changed the capital gain loss on the basis of a report of the registered valuer, therefore, the assessee cannot be charged to under reporting or misreporting of income. The revenue could not rebut this argument of the asessee’s counsel. In our considered view for imposing penalty u/s.270A there should be a clear case of misreporting or under reporting of income by the assessee which is detected by the revenue. Here in this case the revenue has not detected any misrepresenting or under reporting of any income declared by the assessee. It is the assessee itself who suo moto on the basis of report by registered valuer has changed the amount of loss of capital gains. In our considered view since the revenue has not brought on record anything to prove the misrepresentation or under reporting of the income declared by the assessee, therefore, on differences in estimation cannot be levied as per the decision in the case of Reliance Petro Chemicals Pvt. Ltd. (supra) of Hon’ble Supreme Court. Accordingly, assessee’s appeal on this ground is allowed.
In the result, the appeal filed by the assessee is allowed.