SRI GANESSH CHIT FUND,GANJAM V. ITO, WARD-2, BERHAMPUR

ITA 58/CTK/2025

AI Insights

The case involves Sri Ganesh Chit Fund appealing against the penalty imposed under section 270A of the Income Tax Act, 1961, which was confirmed by the CIT (A), National Faceless Appeal Centre, Delhi. The penalty was related to the disallowance of remuneration and interest on capital paid to partners, which was part of the assessment for the assessment year 2017-18. The assessee argued that they had paid the tax demand along with interest within the stipulated time and requested the penalty proceedings to be dropped. However, the Tribunal found that the assessee did not file the application for immunity in the prescribed format as required under section 270AA, leading to the dismissal of their appeal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 708906 (ITAT-CUTTACK)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-07-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Assessment Year: 2017-2018
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: NISHANTH RAO B
• Assessee Lawyers: BIBHUTI BHUSAN PANDA
• Section: 143(3); 270AA

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “CUTTACK” BENCH, CUTTACK BEFORE SHRI GEORGE MATHAN, JM AND SHRI RAJESH KUMAR, AM ITA No. 58/CTK/2025 (Assessment Year: 2017-18) Sri Ganesh Chit Fund Hanuman Bazar, Gundalavari Street Brahmapur Ganjam- 760002, Orissa Vs. ITO, Ward-2, Berhampur Odisha (Appellant) (Respondent) PAN No. AAWFS5606G Assessee by : Shri Bibhuti Bhusan Panda, AR Revenue by : Shri Nishanth Rao B, DR Date of hearing: 17.07.2025 Date of pronouncement: 17.07.2025 O R D E R PER PENCH: This is an appeal filed by the assessee against the order of the ld. CIT (A), National Faceless Appeal Centre, Delhi in appeal no. ITBA/NFAC/S/250/2024-25/1065854310(1) dated 20.06.2024 for A.Y. 2017-18. 02. Shri Bibhuti Bhusan Panda represented on behalf of the assessee and Shri Nishanth Rao B represented on behalf of the Revenue. 03. It was submitted by the ld. AR that the assessment in the case of the assessee has been completed u/s 143(3) of the Income-tax Act, 1961 (the Act) and the remuneration and the salary/ remuneration and interest on capital paid to the partners had been disallowed. It was the submission that the assessee had paid the tax demand raised along with the interest of ₹3,06,290/- on 03.01.2020. It was the submission that the assessment order was passed on 16.12.2019. It was the Page | 2 ITA No. 58/CTK/2025 Sri Ganesh Chit Fund; A.Y. 2017-18 submission that the tax of the interest had been paid within 30 days. It was the submission that the assessee has written a letter to the ld. AO on 14.01.2020, wherein he has mentioned that and the interest have been paid and the penalty proceedings were requested to be dropped. It was the submission that the ld. AO proceeded to levy the penalty u/s 270A of the Act and the ld. CIT (A), NFAC has confirmed the said levy of penalty u/s 270A of the Act. It was the submission that the assessee had claimed immunity u/s 270AA of the Act and the letter had been filed which reads as follows: - “From Sri Ganesh Chit Fund Gundalavari Street, Hanuman Bazar, Berhampur(Gm), Odisha PAN-AAWFS5606G Asst. Yr.-2017-2018 To. The Income-Tax officer, Ward-2, Berhampur (Gm) Sub: Requesting for dropping of penalty U/S 270A of I.T. Act, 1961. Payment of Tax Vide Challan No-00001, Dated-03/01/2020. Ref: Notice No-ITBA/AST/S/156/2019-20/1022482847(1), Dated -16/12/2019 vide order No-ITBA/AST/S/143(3)/2019-20/1022482740(1), Dated-16/12/2019. Sir, With reference to above, the assessment was completed U/S 143(3) raised demand of Tax of Rs. 3,06,290/-. I have paid the demanded tax on 03/01/2020 vide challan No-00001, BSR Code-0320125. Herewith I upload the challan for your kind verification. I request your good self please kindly drop the penalty proceedings U/S 270A of I.T. Act, 1961 for which I shall be ever grateful. Place: Berhampur yours faithfully, Dt-14/01/2020 (P.Anant Kumar)” Page | 3 ITA No. 58/CTK/2025 Sri Ganesh Chit Fund; A.Y. 2017-18 04. It was the submission that the ld. AO ought to have granted the assessee the immunity from the levy of penalty u/s 270A of the Act. 05. In reply, the ld. Sr. DR vehemently supported the order of the ld. AO and ld. CIT (A). It was the submission that there was no application for the claim of immunity u/s 270AA of the Act filed by the assessee. 06. We have considered the rival submissions. A perusal of the Provision of Section 270AA(i) shows that ssessee is to make an application to the Assessing Officer to grant immunity from imposition of penalty under section 270A, if he fulfils the following conditions, namely (a) no appeal against the order referred to in clause (a) has been filed. In section 271AA(2) also refers to application referred to in sub-section (1) shall be made within one month from the end of the month in which the order referred to in clause (a) of sub-section (1) has been received and shall be made in such form and verified in such manner as may be prescribed. In the present case, admittedly no application for immunity has been filed in the prescribed format as required under sub-clause (2) of Section 270AA has been filed. The letter filed by the assessee, which has been extracted above is not in prescribed format. This is only the intimation, saying that the tax and the interest have been paid. There is no mentioned of the second condition being filing of the appeal. Admittedly, the assessee has paid the tax within the specified period. It is also an admitted fact that the assessee has not filed an appeal against the assessment order. However, as the assessee has not filed necessary application as per the provision of Section 270AA of the Act, cannot be brought into the play as the assessee has given any explanation in regard to penalty levied u/s 270A of the Act. We find no reason to Page | 4 ITA No. 58/CTK/2025 Sri Ganesh Chit Fund; A.Y. 2017-18 interfere in the order of the ld. CIT (A), NFAC, confirming the levy of penalty u/s 270A of the Act. 07. In the result, the appeal of the assessee is dismissed. Order pronounced in the open court on 17.07.2025. Sd/- Sd/- (RAJESH KUMAR) (GEORGE MATHAN) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) Kolkata, Dated: 17.07.2025 Sudip Sarkar, Sr.PS Copy of the Order forwarded to: 1. The Appellant 2. The Respondent 3. CIT 4. DR, ITAT, 5. Guard file. BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Cuttack "