Find
Penalty under Sec 270A is linked to the under-reported income. If the addition is deleted in appeal, the base for penalty goes, and the penalty should be cancelled or reduced.
ITR
Addition deleted in appeal: what happens to penalty
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Provisions
Sec 270A (now Sec 439); Sec 154 (now Sec 287)
Analysis
Send the appellate order to the officer and ask that the penalty order be cancelled or the proceedings dropped. If only part of the addition was deleted, for example ₹3,00,000 out of ₹5,00,000, ask for penalty to be recomputed on ₹2,00,000. If the department appeals further, the penalty may be revisited later. Keep the demand record updated on the portal.
Close
- Download the appellate order
- Write to the Jurisdictional AO asking to cancel or recompute penalty
- Update Response to Outstanding Demand with the order
- Track if the department files a further appeal
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