Saturday, April 23, 2016

Mistake by return filing portal, doesn't call for concealment penalty on taxpayer

Where assessee's salary was understated in her return due to mistake of online tax return filing portal ( and she could not verify contents of return due to her pregnancy and immense pressure in office, concealment penalty was not justified
a)     Assessee was a salaried employee who provided her Form No. 16 to an online tax return filing website ( for filing of her return of income. Due to a mistake committed by website, her income was understated in return of income.
b)    Assessee received ITR-V from website and as she was having pregnancy of five months and due to immense work pressure in the office, she could not devote time to see the content of ITR filed, signed it straightaway and sent it to Income-tax Department.
c)     The Assessing Officer (AO) levied concealment penalty on her for understating the income.

d)    CIT(A) confirmed the order of the AO. Aggrieved by the order of the CIT(A), assessee filed the instant appeal before the tribunal.

The tribunal held in favour of assessee as under-
1)    The assessee's salary income was subjected to deduction of tax at source by her employer and the employer intimated the revenue about the gross salary paid and tax so deducted at source on such salary by filing quarterly return of TDS. Thus, the revenue was fully aware of her salary income.
2)    It is not possible under normal circumstances for a salaried employee to evade taxes by filing inaccurate salary particulars or concealing salary income in the return of income as the mismatch in the information furnished by the taxpayer vide return of income vis-à-vis information furnished by the employer will be captured by the revenue.
3)    In the instant case, salary income was understated due to error committed by the online tax return filing portal and, accordingly, refund of TDS was granted to assessee. However, as soon as she came to know about the error/mistake, she immediately took steps to deposit back the refund into the Government Treasury and intimated to the Assessing Officer.
4)    Thus, the conduct of the assessee was bona-fide and there was no mala-fide intention on her part although error/mistake took place in filing return of income. Hence, she was not liable for concealment penalty- [2016] 68 268 (Mumbai - Trib.)

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