आदेश /O R D E R

PER S. R. RAGHUNATHA, AM :

The present appeal is filed by the assessee against the order dated 28.07.2025 passed by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred to as “ld.CIT(A)”), dismissing the appeal filed by the assessee against the penalty order dated 19.08.2024 passed u/s.270A of the Income Tax Act, 1961 (hereinafter referred to as the “Act”), pertaining to Assessment Year (A.Y.) 2019-20.

2. Brief facts of the case are that the assessee is an individual and for the impugned Assessment Year 2019-20, the assessee filed his return of income on 31.10.2019 declaring a total income of Rs.22,66,940/-. Thereafter, notice u/s.148 of the Act was issued and the assessee filed a return in response to the same, wherein a sum of Rs.37,95,350/- was admitted as income. Subsequently, an assessment order came to be passed u/s.147 read with section 144B of the Act on 26.02.2024 accepting the return filed by the assessee in response to notice u/s.148 of the Act. Thereafter, penalty proceedings were initiated u/s.270A of the Act. The allegation of the Assessing Officer was that there was an ‘under reporting of income’ in consequence of misreporting to the tune of Rs.15,28,406/-.

3. During the course of the penalty proceedings, the Assessing Officer issued various notices on the assessee who responded to the same. The assessee furnished case laws in support of his case and also submitted that he is in process of getting immunity for the penalty. He further requested the Assessing Officer to clarify the “part of Section 270A for which the penalty initiated is sought for”. The Assessing Officer, after perusing the submission of the assessee, stated that the penalty is initiated for under reporting of income in consequence of misreporting and the same is specified in the assessment order as well as in show-cause notice. Thereafter, the Assessing Officer passed the penalty order u/s.270A on 19.08.2024, imposing a penalty of Rs.9,53,722/- while holding that the assessee failed to substantiate and explain the ‘under reporting of income’ in consequence to misreporting. The Assessing Officer held that the assessee under reported the income to the tune of Rs.15,28,406/- and the tax payable on the same is Rs.4,76,861/- and the penalty levied at 200% on the tax payable which is Rs.9,53,722/- and passed a penalty order dated 19.08.2024 u/s.270A of the Act.

4. Aggrieved by the penalty order of the Assessing Officer, the assessee filed an appeal before the ld.CIT(A) on 24.08.2024. In the appellate proceedings, the assessee has filed detailed responses wherein the assessee submitted that the return filed in response to notice u/s.148 of the Act was accepted in the assessment order dated 26.02.2019 and hence, there is no under-reporting in consequence of misreporting of income. It was further submitted that the assessee was under bona-fide belief that sale of inherited lands is not required to be admitted, although, the sale was disclosed in the return on 31.10.2019, under the schedules. Further, the assessee also pointed that penalty was levied by the Assessment Unit but as per Section 272(2A) of the Act and CBDT Notification S.O.118(E) [No.3/2021 F.No.3714] dated 12.01.2021, the penalty should only be levied by the National Faceless Penalty Unit as they are empowered to do so under the Faceless Scheme. It was also contended that there is no record for prior approval from JCIT as mandated u/s.274(2) of the Act. In support of his submission, the assessee relied on the following case:

1. CIT V. Shahabad Co-operative Sugar Mills Ltd. (2010) 322 ITR 230 (P&H).

2. National Faceless Assessment Centre, Delhi V. M/s. JMC Projects India Ltd. [ITA No.2029/Ahd/2023].

5. The ld.CIT(A), in the order has stated that the assessee’s case applies to Section 270A(2)(c) of the Act and since the assessee is unable to explain the reason behind the non-disclosure of sale proceeds of the land