ITAT Quashes Section 270 A Penalty

The Nagpur Bench of the Income Tax Appellate Tribunal (ITAT) deleted penalties imposed under Section 270A of the Income-tax Act, 1961, holding that a bona fide claim based on the Place of Effective Management (POEM) provisions and CBDT Circulars could not be equated with “misreporting of income.” 

The Tribunal observed that mere rejection of a legal claim during assessment proceedings does not automatically establish misrepresentation or suppression of facts warranting penalty at 200% of tax sought to be evaded.