Home Archives - Tax Heal https://www.taxheal.com/category/home Complete Guide for Income Tax and GST in India Wed, 17 Jun 2026 06:44:35 +0000 en-US hourly 1 https://wordpress.org/?v=7.0.3 Canara Bank FORM OF NOMINATION UNDER THE PUBLIC PROVIDENT FUND SCHEME, 1968 from Download https://www.taxheal.com/canara-bank-form-of-nomination-under-the-public-provident-fund-scheme-1968-from-download.html Wed, 17 Jun 2026 06:44:35 +0000 https://www.taxheal.com/?p=133819 Canara Bank FORM OF NOMINATION UNDER THE PUBLIC PROVIDENT FUND SCHEME, 1968 Canara Bank FORM OF NOMINATION UNDER THE PUBLIC PROVIDENT FUND SCHEME, 1968 from Download Based on the provided document, here are the key points of Canara Bank PPF Form E (NF 356), which is used for registering a nomination under the Public Provident… Read More »

]]> Canara Bank FORM OF NOMINATION UNDER THE PUBLIC PROVIDENT FUND SCHEME, 1968

Canara Bank FORM OF NOMINATION UNDER THE PUBLIC PROVIDENT FUND SCHEME, 1968 from Download

Based on the provided document, here are the key points of Canara Bank PPF Form E (NF 356), which is used for registering a nomination under the Public Provident Fund (PPF) Scheme (NF_356_ASS… pp. 1-2):

Core Form Purpose

  • Nomination Registration: Allows a PPF subscriber to formally designate one or more individuals to receive their account balance in the event of their death (NF_356_ASS… p. 1).
  • Bilingual Format: Features standard informational fields structured side-by-side in Assamese and English (NF_356_ASS… p. 1).

Nominee Registration Details

  • Account Linkage: Captures the subscriber’s name and exact PPF Account Number (NF_356_ASS… p. 1).
  • Detailed Mapping Table: Collects the full name, complete residential address, date of birth (mandatory if the nominee is a minor), and the specific proportionate share percentage allocated to each beneficiary (NF_356_ASS… p. 1).

Minor Guard Rules

  • Guardian Appointment: If any named nominee is a minor, the subscriber must explicitly designate a legal guardian (including their full name and address) (NF_356_ASS… p. 1).
  • Payout Authority: This appointed guardian is authorized to collect the account funds if the subscriber passes away while the nominee is still a minor (NF_356_ASS… p. 1).

Dispute Resolution & Legal Priority

  • Nominee Preference: The subscriber explicitly agrees that if a simultaneous claim occurs between the nominee and legal heirs, the bank is legally discharged by settling the claim solely in favour of the nominee (NF_356_ASS… p. 2).
  • Court Order Precedence: The bank reserves the right to override standard nomination terms and act strictly in accordance with any specific court orders issued regarding the PPF account (NF_356_ASS… p. 2).

Verification & Processing

  • Subscriber Validation: Requires the physical signature or thumb impression of the primary subscriber (NF_356_ASS… p. 2).
  • Witness Verification: Demands the signature, name, address, and date from an independent witness to authenticate the subscriber’s execution (NF_356_ASS… pp. 1-2).
  • Official Account Ledger: Final registration requires the bank’s Accounts Officer to sign and date the document, certifying that the nomination has been recorded in the bank’s system and entered into the subscriber’s physical passbook (NF_356_ASS… p. 2).
]]> Bank following binding interim High Court orders cannot be treated as an assessee in default. https://www.taxheal.com/siddhartha-nautiyal-judicial-member.html Tue, 02 Jun 2026 05:08:41 +0000 https://www.taxheal.com/?p=132463 Bank following binding interim High Court orders cannot be treated as an assessee in default. Issue Whether an employer-bank can be treated as an “assessee in default” under section 201(1) and charged interest under section 201(1A) for failing to deduct tax at source on foreign-leg Leave Fare Concession (LFC/LTC) reimbursements, if the bank was operating… Read More »

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Bank following binding interim High Court orders cannot be treated as an assessee in default.

Issue

Whether an employer-bank can be treated as an “assessee in default” under section 201(1) and charged interest under section 201(1A) for failing to deduct tax at source on foreign-leg Leave Fare Concession (LFC/LTC) reimbursements, if the bank was operating under specific interim directions from a High Court stating that such payments would not constitute income for TDS purposes.

Facts

  • The assessee-bank granted Leave Fare Concession / Leave Travel Concession (LFC/LTC) to certain employees for journeys that included a foreign destination leg.

  • The bank did not deduct tax at source (TDS) under section 192 on these travel reimbursements.

  • It contended that the tax exemption under section 10(5) read with Rule 2B applied to the eligible Indian leg of the travel fare.

  • Crucially, the bank was operating under binding interim directions issued by the Madras High Court, which explicitly clarified that these LFC reimbursements would not constitute income for TDS purposes.

  • The High Court’s interim order also specified that if the underlying writ petition ultimately failed, the consequential tax liability would fall directly on the individual employees, not the bank.

  • The Assessing Officer (AO) rejected this approach, holding that any travel reimbursement involving a foreign leg became fully taxable as salary.

  • The AO determined that the bank was legally obligated to deduct TDS under section 192 and subsequently treated the bank as an “assessee in default” under section 201(1), while also levying interest under section 201(1A).

Decision

  • Held, yes; since the assessee-bank was strictly operating under the binding interim directions of the Madras High Court which protected them from deducting TDS on these payments, it could not be legally treated as an assessee in default under section 201(1) for the period in question.

  • Held, yes; because the primary declaration of being an “assessee in default” was struck down, the consequential interest levied by the AO under section 201(1A) also could not survive and was entirely deleted.

  • The appeal was decided fully in favor of the assessee-bank.

Key Takeaways

  • Sanctity of Judicial Orders: An assessee cannot be penalized or held in default by the revenue department for actions that strictly conform to active, binding interim directions issued by a Constitutional Court.

  • TDS Liability Shift: When a High Court’s interim order explicitly shifts the potential financial risk to the ultimate beneficiaries (the employees) in the event that a petition fails, the revenue cannot retrospectively demand that the withholding agent (the employer) bear the burden.

  • Interest is Consequential: Interest under section 201(1A) is directly tied to the primary status of being an assessee in default under section 201(1). If the underlying default status is invalidated, the interest liability automatically evaporates.

IN THE ITAT AHMEDABAD BENCH ‘C’
State Bank of India Currency Administration Cell
v.
Income-tax Officer*
Siddhartha Nautiyal, Judicial Member
and Narendra Prasad Sinha, Accountant Member
I.T. Appeal No.1011 and 1044 (Ahd) OF 2026
[Assessment years 2016-17 and 2017-18]
MAY  8, 2026
Lokesh Karia, AR for the Appellant. Amit Pratap Singh, Sr. DR for the Respondent.
ORDER
Siddhartha Nautiyal, Judicial Member. – Both appeals have been filed by the Assessee against the order passed by the Ld. Commissioner of Income Tax (Appeals), (in short “Ld. CIT(A)”), ADDL/JCIT(A)-2, Siliguri vide orders dated 22.01.2026 & 12.01.2026 passed for A.Y. 2016-17 & 2017-18. Since common facts and issues for consideration are involved for both the appeals before us, both the appeals are being disposed by way of a common order.
2. The assessee has taken the following grounds of appeal:
ITA No. 1011/Ahd/2026 (A. Y. 2016-17)
“In our cases assessing officer has disallowed exemption u/s.10(5) of Income Tax Act, on the base of differences in interpretation of law and treated us as assessee in default and passed order against us u/s. 201(1) and 201(1A) of the Income Tax Act and we filed appeal against said order before CIT (Appeals), which is dismissed and order was issued u/s.250 of the Income Tax Act.
The Kerala High Court has held in a recent judgment that State Bank of India (SBI) cannot be treated as an “Assessee in Default” under section 201 of the Income Tax act for not deducting Tax at Source (TDS) on Leave Travel Concession (LTC) payments, as it was bound by an interim order which prohibited such deduction. The copy of said order is attached herewith.
Therefore against said order u/s. 250 and u/s. 201(1) and 201(1A), we prefer to file appeal before ITAT and furnished facts of the case along with said appeal along with relevant documentary evidences and we demand the withdrawal of the same from your honour by allowing our appeal on the basis of grounds and evidences furnished by us. “
ITA No. 1044/Ahd/2026 (A. Y. 2017-18)
“In our cases assessing officer has disallowed exemption u/s.10(5) of Income Tax Act, on the base of differences in interpretation of law and treated us as assessee in default and passed order against us u/s. 201(1) and 201(1A) of the Income Tax Act and we filed appeal against said order before CIT (Appeals), which is dismissed and order was issued u/s.250 of the Income Tax Act.
The Kerala High Court has held in a recent judgment that State Bank of India (SBI) cannot be treated as an “Assessee in Default” under section 201 of the Income Tax act for not deducting Tax at Source (TDS) on Leave Travel Concession (LTC) payments, as it was bound by an interim order which prohibited such deduction. The copy of said order is attached herewith.
Therefore against said order u/s. 250 and u/s. 201(1) and 201(1A), we prefer to file appeal before ITAT and furnished facts of the case along with said appeal along with relevant documentary evidences and we demand the withdrawal of the same from your honour by allowing our appeal on the basis of grounds and evidences furnished by us. “
ITA No. 1011/Ahd/2026 (A.Y. 2016-17)
3. The brief facts of the case are that the assessee, State Bank of India Currency Administration Cell, Gandhinagar, was subjected to proceedings under section 201(1) and 201(1A) of the Income-tax Act, 1961 (“the Act”) the assessee on the ground that it had failed to deduct tax at source under section 192 of the Act on Leave Fare Concession/Leave Travel Concession (LFC/LTC) granted to certain employees who had undertaken journeys involving a foreign leg during the financial year relevant to Assessment Year 2016-17. During the course of assessment proceedings, the Assessing Officer observed that exemption under section 10(5) of the Act read with Rule 2B of the Income Tax Rules is available only in respect of travel within India and once the employee undertakes travel involving a foreign destination, the exemption ceases to apply. The Assessing Officer relied upon the judgment of the Hon’ble Supreme Court in Civil Appeal No. 8181 of 2022 dated 04.11.2022 in the case of State Bank of India v. Asstt. (SC)/[2022] 449 ITR 192 (SC), wherein the Hon’ble Apex Court held that LTC exemption is restricted only to travel from one place in India to another place in India and the moment the journey involves a foreign leg, the exemption under section 10(5) is not available.
4. The assessee before the Assessing Officer contended that the designated place of travel of employees was within India and reimbursement was restricted only to the eligible fare relatable to Indian travel in accordance with Rule 2B of the Rules. It was further contended that there was no express statutory prohibition against an incidental foreign leg in the course of travel and the bank had acted under a bona fide belief based on prevailing industry practice, IBA guidelines and judicial precedents. The assessee also relied upon interim orders passed by the Hon’ble Madras High Court in the case of All India State Bank Officers Federation v. State Bank of India, wherein the Hon’ble High Court had specifically directed that LFC reimbursement would not amount to income for the purpose of deduction of tax at source and further clarified that in case the writ petition failed, the liability to pay tax would be on the employees. The assessee submitted that during the subsistence of such interim judicial directions, it was legally restrained from deducting tax at source and any contrary action would have amounted to disobedience of binding judicial orders.
5. The Assessing Officer, however, rejected the submissions of the assessee and held that in view of the final judgment of the Hon’ble Supreme Court dated 04.11.2022, the issue had attained finality against the assessee. The Assessing Officer held that once the employees undertook travel involving a foreign leg, the reimbursement became taxable salary and consequently the assessee was under a statutory obligation under section 192 to deduct tax at source. Accordingly, the assessee was treated as an assessee in default under section 201(1) and demand along with interest under section 201(1A) was raised.
6. Aggrieved by the order of the Assessing Officer, the assessee preferred appeal before the learned CIT(Appeals). The learned CIT(Appeals) passed an order examining the provisions of section 10(5), Rule 2B and the judgment of the Hon’ble Supreme Court in the case of State Bank of India v. ACIT (supra). The learned CIT(Appeals) observed that a conjoint reading of section 10(5) and Rule 2B clearly establishes that exemption is admissible only where travel is undertaken from one place in India to another place in India by the shortest route. The learned CIT(Appeals) held that the moment a foreign leg is involved, the travel ceases to qualify as travel within India and therefore falls outside the scope of exemption under section 10(5) of the Act. The learned CIT(Appeals) reproduced in detail the findings of the Hon’ble Supreme Court, particularly the observations that LTC is intended to promote domestic travel within India and that foreign travel frustrates the very object of the scheme.
7. The learned CIT(Appeals) further analysed the sequence of judicial proceedings before the Hon’ble Madras High Court and the Hon’ble Supreme Court. The learned CIT(Appeals) observed that although interim protection had been granted by the Hon’ble Madras High Court at various stages, there existed certain periods during which no stay operated and during such periods the assessee ought to have deducted tax at source or recovered the amount from employees. The learned CIT(Appeals) held that the obligation to deduct tax is distinct from recovery of tax and once the legal position stood clarified by the Hon’ble Supreme Court, the assessee could not avoid the consequences under section 201(1) and 201(1A). Reliance was also placed by the learned CIT(Appeals) on the decision of the Chennai Bench of the Tribunal in State Bank of India, Chennai v. ACIT [IT Appeal No.1465 (Chny) of 2024, dated 27-6-2025], wherein the Tribunal had upheld the action of the Department for periods during which no active stay operated. Accordingly, the learned CIT(Appeals) confirmed the action of the Assessing Officer in treating the assessee as an assessee in default under section 201(1) and in levying consequential interest under section 201(1A), though directions were issued for staying recovery till disposal of proceedings before higher judicial forums and for rectification of computational errors, if any.
8. The assessee is in appeal before us against the order passed by CIT(Appeals) dismissing the appeal of the assessee.
9. We have heard the rival submissions and perused the material available on record. The short controversy before us is not with regard to the merits of exemption under section 10(5) of the Act, which now admittedly stands concluded against the assessee by the judgment of the Hon’ble Supreme Court in State Bank of India (supra).
10. The limited issue before us is whether, in the peculiar facts of the present case, the assessee can be treated as an assessee in default under section 201(1) of the Act and consequently saddled with interest liability under section 201(1A) for non-deduction of tax at source during the period when binding interim judicial directions of the Hon’ble Madras High Court were operating.
11. We find that this issue is now squarely covered in favour of the assessee by the decision of the Coordinate Bench of Ahmedabad Tribunal in the case of State Bank of India Bhavnagar Para Branch v. ITO  (Ahmedabad – Trib.). The Coordinate Bench, after considering the judgment of the Hon’ble Supreme Court, the interim orders of the Hon’ble Madras High Court, the decision of the Kerala High Court and the Agra Bench of the Tribunal, held that the assessee-bank could not be treated as an assessee in default under section 201(1) for the relevant period.
12. The relevant observations of the Coordinate Bench are reproduced below:
“The contention of the assessee has consistently been that during the year under consideration, it was bound by the interim orders passed by the Hon ‘ble Madras High Court in All India State Bank Officers Federation v. State Bank of India 447ITR 559 (Madras), wherein vide order dated 16.02.2015 it was specifically clarified that the LFC payments would not amount to income so as to enable deduction of tax at source and further that if the writ petition was ultimately dismissed, the employees would be liable to pay tax. The assessee has submitted that in view of such binding judicial directions, it could not have deducted tax at source and any such deduction would have amounted to disobedience of the order of the Hon ‘ble High Court. “
“We find considerable merit in the aforesaid contention of the assessee. The interim directions of the Hon’ble Madras High Court were in force during the relevant previous year and the assessee, being a party to the proceedings, was duty bound to comply with the same. The obligation under section 192 of the Act to deduct tax at source cannot be read in isolation and must yield to binding judicial orders. Therefore, the failure to deduct tax in such circumstances cannot be equated with a default contemplated under section 201(1) of the Act. “
13. The Coordinate Bench further relied upon the decision of the Agra Bench of the Tribunal in State Bank of India v. CIT(Appeals) and the judgment of the Hon’ble Kerala High Court in State Bank of India v. CIT. The findings of the Hon’ble Kerala High Court, as reproduced by the Coordinate Bench, are relevant and are reproduced below:
“It is only when the appellant-assessee, after having a liability to deduct tax, fails to do so, the question of invoking Section 201 of the Act and treating it as an ‘assessee in default’ arises. Here, the Madras High Court found, prima facie, that the amount paid would not be the income of a payee so as to deduct tax. Therefore, we are of the opinion that the provisions of Section 201(1) of the Act are not attracted to the case at hand. “
“The appellant-assessee was under an obligation not to deduct tax at source and therefore, the assessee could not be held to be assessee in-default for non-deduction of tax at source on impugned LFC payments. “
14. The Ahmedabad Bench thereafter held as under:
“In the present case also, the facts are materially identical. The assessee was operating under the binding interim directions of the Hon ‘ble Madras High Court during the relevant period and therefore could not have deducted tax at source. The subsequent decision of the Hon’ble Supreme Court, though settling the issue on merits, cannot retrospectively fasten liability under section 201(1) of the Act for a period during which the assessee was acting in compliance with judicial orders. “
“We also find force in the argument of the assessee that the scheme of section 201 of the Act itself contemplates that a person can be treated as an assessee in default only when there is a failure to deduct tax in spite of a legal obligation to do so. In the present case, such legal obligation stood eclipsed by the interim directions of the Hon ‘ble High Court. “
“In view of the above discussion, respectfully following the decision of the Hon’ble Kerala High Court in State Bank of India (supra) and the decision of the Co-ordinate Bench in ITA No.514/Agr/2024, we hold that the assessee cannot be treated as an assessee in default under section 201(1) of the Act for the impugned period. Consequently, the interest charged under section 201(1A) also does not survive. “
15. We find that the facts of the present case are materially identical to the facts before the Ahmedabad Bench. During the relevant assessment year, the assessee-bank was operating under binding interim directions of the Hon’ble Madras High Court specifically clarifying that LFC payments would not constitute income for TDS purposes. Therefore, the assessee was legally bound to comply with such judicial directions and any deduction of tax contrary thereto would have exposed the assessee to proceedings for contempt of court. In such circumstances, the failure to deduct tax at source cannot be treated as a default contemplated under section 201(1) of the Act.
16. Respectfully following the decision of the Coordinate Bench of Ahmedabad Tribunal in State Bank of India Bhavnagar Para Branch (supra), the decision of the Hon’ble Kerala High Court in State Bank of India v. CIT  (Kerala) and the decision of the Agra Bench of the Tribunal in State Bank of India v. CIT (Appeals) [2025]  (Agra – Trib.), we hold that the assessee cannot be treated as an assessee in default under section 201(1) of the Act for the impugned period. Consequently, the interest levied under section 201(1A) also does not survive.
17. Accordingly, the Assessing Officer is directed to delete the demand raised under section 201(1) and interest levied under section 201(1A) of the Act.
18. In the result, the appeal of the assessee is allowed.
19. Since the facts in ITA No. 1011/Ahd/2026 are materially similar to facts in ITA No. 1044/Ahd/2026, appeal of the assessee is allowed in ITA No. 1044/Ahd/2026 as well.
20. In the combined result, both the appeals of the assessee are allowed.
]]> No Under-Reporting Penalty Attracted When Reassessed Income Matches Return Filed Under Section 148 https://www.taxheal.com/deputy-commissioner-of-income-tax.html Sat, 30 May 2026 05:06:16 +0000 https://www.taxheal.com/?p=132213 No Under-Reporting Penalty Attracted When Reassessed Income Matches Return Filed Under Section 148 Issue Whether a penalty for under-reporting or misreporting of income under Section 270A can be sustained when the final reassessed income under Section 147 perfectly matches the income declared by the assessee in response to a Section 148 notice, and where the… Read More »

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No Under-Reporting Penalty Attracted When Reassessed Income Matches Return Filed Under Section 148

Issue

Whether a penalty for under-reporting or misreporting of income under Section 270A can be sustained when the final reassessed income under Section 147 perfectly matches the income declared by the assessee in response to a Section 148 notice, and where the omission in the original return was due to a bona fide belief regarding tax-exempt agricultural land transactions.

Facts

  • Original Filing: The assessee, an individual, initially filed a regular return of income for the Assessment Year 2020-21 declaring a total income of ₹22.42 lakhs.

  • The Omission: Following a department search, it was discovered that the assessee had sold a parcel of agricultural land for ₹85 lakhs without offering the resulting capital gains to tax.

  • Reopening of Assessment: The income tax department reopened the case under Section 147 and served a notice under Section 148 upon the assessee.

  • Response to Notice: In direct response to the Section 148 notice, the assessee filed a new return declaring an enhanced total income of approximately ₹30.11 lakhs, which fully included a short-term capital gain of about ₹7.90 lakhs from the land sale, with all due taxes paid.

  • Assessment Conclusion: The Assessing Officer (AO) completed the reassessment under Section 147, entirely accepting the revised income figure submitted by the assessee in the Section 148 return.

  • Penalty Imposed: Despite accepting the return, the AO treated the difference between the original income (under Section 143(1)) and the final reassessed income as under-reported income due to misreporting. Accordingly, the AO levied a 200% penalty on the tax amount under Section 270A(9).

  • Assessee’s Explanation: The assessee explained that the initial non-disclosure was based on a bona fide belief that selling dry agricultural land to reinvest in another agricultural plot did not attract income tax.

Decision

  • No Differential, No Under-Reporting: The appellate authority held that the concept of under-reporting must be evaluated by comparing the income assessed by the AO against the return filed specifically in response to the Section 148 notice. Since there was zero difference between the reassessed income and the Section 148 returned income, the statutory baseline for under-reporting did not exist.

  • Bona Fide Exception Apparent: Under Section 270A, under-reported income explicitly excludes amounts where the taxpayer offers a bona fide explanation and discloses all material facts. The panel found the assessee’s explanation regarding agricultural land status to be completely bona fide.

  • Penalty Deleted: Because the AO accepted the returned figures and the explanation was legitimate, the court ruled that the AO should not have levied the penalty. The Section 270A penalty was officially deleted.

Key Takeaways

  • The Section 148 Baseline Rule: For reassessment proceedings, the benchmark for measuring “under-reporting” shifts to the return filed in response to the Section 148 notice. If the AO accepts that specific return without further additions, a penalty under Section 270A cannot be mechanically triggered.

  • Protection via Bona Fide Explanations: A subjective error or misconception of law (such as confusing the taxability rules of rural vs. dry agricultural land transitions) will not be penalized as deliberate misreporting if the taxpayer acts in good faith, cooperates with the reopening notice, pays the tax, and fully discloses the material facts.

  • No Automated Penalty Application: Tax authorities cannot use reassessment entry points to automatically enforce the maximum 200% penalty rate under the guise of misreporting without establishing a deliberate intent to deceive or a secondary discrepancy in the reassessment filing itself.

IN THE ITAT HYDERABAD BENCH ‘SMC’
Ratna Show Reddy Singareddy
v.
Deputy Commissioner of Income-tax
VIJAY PAL RAO, Vice President
and MANJUNATHA G, Accountant Member
I.T.A.No. 42 (Hyd) OF 2026
[Assessment year 2020-21]
MAY  6, 2026
Vamseedhar, C.A. for the Appellant. Mookambikeyan S., Sr. AR for the Respondent.
ORDER
Manjunatha G., Accountant Member. – This appeal filed by the assessee is directed against the order of the learned Commissioner of Income Tax (Appeals) – Hyderabad -11, (for short “Ld. CIT(A)), dated 14.11.2025, pertaining to the assessment year 2020-21.
2. The brief facts of the case are that, the assessee is an individual and filed his original return of income for A.Y. 2020-21 on 09.01.2021, admitting the total income of Rs.22,42,400/-. A search and seizure operation under section 132 of the Income-tax Act, 1961 was conducted in the group cases of M/s. Bala Vikasa Social Service Society on 15.03.2023 and as a part of search, the case of the assessee was also covered. During the course of search, it was found that, the assessee had sold immovable property for a consideration of Rs.85,00,000/-, however, has not offered capital gains to tax. Consequent to search, the assessment has been reopened under section 147 of the Act, and during the course of assessment proceedings, the A.O. called upon the assessee to file relevant details of computation of capital gain, if any, for sale of property. The assessee filed the return of income in response to notice under section 148 of the Act, on 26.07.2024, declaring total income of Rs.30,11,280/-, which includes short-term capital gain of Rs.7,90,475/- from sale of property. The A.O., after considering relevant submissions of the assessee and also taking note of the return of income filed by the assessee, completed assessment under section 147 of the Act, on 07.02.2025 and accepted the income declared by the assessee. The A.O. had also initiated penalty proceedings under section 270A of the Act, for under-reporting of income, is in consequence of misreporting thereof.
3. During the penalty proceedings, the A.O. called upon the assessee to explain as to why the penalty shall not be levied for under-reporting of income, is in consequence of misreporting of income of Rs.7,90,475/- in respect of short-term capital gain offered in the return of income filed in response to notice issued under section 148 of the Act. In response, the assessee submitted his explanation on 17.02.2025 and on 21.07.2025 and claimed that, he had sold dry agricultural land for a consideration of Rs.85,00,000/-and also purchased another agricultural land from the sale consideration, and on the bonafide belief that sale of agricultural land and purchase of another agricultural land does not attract tax. The assessee further submitted that, he has also admitted capital gain for sale of property in response to notice under section 148 of the Act, and therefore, it cannot be said that the assessee has under-reported income, is in consequence of misreporting of income.
4. The A.O., after considering relevant submissions of the assessee and also taking note of the provisions of section 270A(9) of the Act, observed that, there is a difference between income computed in the assessment order passed under section 147 r.w.s. 143(3) of the Act, and the income determined in the order passed under section 143(1) of the Act, and the difference in amount of income admitted by the assessee falls under the category of under-reporting of income, and further, the same is liable for penalty under section 270A(9) of the Act, for under-reporting of income, is in consequence of misreporting of income, and therefore, rejected the explanation of the assessee and levied penalty of Rs.4,79,780/-, which is 200% of the amount of tax payable on under-reporting of income.
5. Aggrieved by the penalty order, the assessee preferred appeal before the learned CIT(A) and challenged levy of penalty under section 270A(9) of the Act. Before the learned CIT(A), the assessee submitted that, he was under the bona fide belief that sale of agricultural land and purchase of another agricultural land, no tax is leviable and accordingly not has disclosed the transactions in the return of income filed under section 139(1) of the Act. The assessee further submitted that, he has voluntarily admitted short-term capital gains and paid taxes in the return of income filed in response to notice under section 148 of the Act, and therefore, the case of the assessee cannot be considered under section 270A(9) of the Act. The learned CIT(A), after considering the submissions of the assessee and also taking note of provisions of section 270A(9) of the Act, observed that, the assessee has under-reported income, is in consequence of misreporting of income by misrepresentation or suppression of facts which is evident from the relevant return of income filed by the assessee under section 139 of the Act, and return of income filed in response to notice under section 148 of the Act. Further, it is also pertinent to note that the assessee has not offered the short-term capital gain voluntarily, but due to the very fact that the sale of agricultural land was unearthed during the course of search operation and the search had not taken place, the assessee would not have disclosed capital gains. Therefore, it is a clear case of under-reporting of income, is in consequence of misreporting thereof, and therefore, the A.O. has rightly levied penalty under section 270A(9) of the Act, and thus, rejected the explanation of the assessee and upheld the penalty levied by the A.O.
6. Aggrieved by the order of the learned CIT(A), the assessee is in appeal before the Tribunal.
7. The learned counsel for the assessee, Shri Vamseedhar, C.A. submitted that, the learned CIT(A) erred in sustaining the penalty levied under section 270A(9) of the Act, even though there is no difference between the returned income and assessed income, and unless there is a difference in the returned income and assessed income, the concept of under-reporting of income cannot be applied. The learned counsel for the assessee further submitted that, the assessee had sold agricultural land and had also purchased another agricultural land, and the assessee was under the bona fide belief that the sale of agricultural land does not attract capital gains. However, upon noticing the fact that the assessee is liable to pay tax on sale of land, he had disclosed capital gains in response to notice under section 148 of the Act, and also paid taxes. Therefore, the A.O. was not right in invoking the provisions of section 270A and levying penalty for misreporting of income. The learned CIT(A), without appreciating the relevant facts, simply upheld the penalty levied by the A.O. Therefore, he submitted that the order of the learned CIT(A) should be set aside and the penalty levied by the A.O. should be deleted.
8. The learned Senior A.R. for the Revenue, Shri S. Mookambikeyan, on the other hand, supporting the order of the learned CIT(A), submitted that, it is a clear case of under-reporting of income, is in consequence of misreporting of income, which is evident from the return of income filed under section 139 of the Act, and the revised return filed in response to notice under section 148 of the Act. The assessee has not reported capital gains in the original return of income. Although the assessee has reported capital gains in the revised return filed in response to notice under section 148 of the Act, but fact remains that there is a difference between determined under section 143(1) of the Act, and income assessed, which falls under sub-section (3) of section 270A of the Act. Since the assessee has misrepresented or suppressed the facts with regard to the capital gains, the A.O. has rightly invoked section 270A(9) of the Act. Thus, there is no merit in the arguments of the assessee and thus, the appeal filed by the assessee should be dismissed.
9. We have heard both parties, perused the material available on record, and had gone through the orders of the authorities below. There is no dispute with regard to the fact that the assessee has not disclosed the capital gains derived on sale of agricultural land in the return of income filed under section 139 of the Act. It is also not in dispute that the assessee has disclosed the capital gains derived from sale of agricultural land in the return of income filed in response to notice issued under section 148 of the Act, and paid relevant taxes. The A.O. completed the assessment and accepted the return filed in response to notice under section 148 of the Act. Therefore, it is necessary for us to decide the issue of levy of penalty under section 270A(9) of the Act, in light of the above facts and also the arguments of the learned counsel for the assessee.
10. The A.O. invoked provisions of Section 270A(9) of the Act, and levied 200% penalty on tax sought to be evaded in respect of underreporting of income. The amount of under reported income has been explained under sub-section (3) of Section 270A of the Act, and according to sub-section (3), in a case where the income has been assessed for the first time, if return has been furnished, the difference, if any, between the amount of income assessed and the amount of income determined under Section 143(1) of the Act, shall be treated as under-reported income. In the present case, there is no difference between the income assessed for the first time and the income determined as per section 143(3) of the Act, because there was no regular assessment under section 143(3) of the Act. However, there is a difference between the income assessed by the A.O. in the order passed under Section 143(3) r.w.s. 147 of the Act, and the income determined under Section 143(1) of the Act. However, there is no difference between the income returned by the assessee in response to notice under Section 148 of the Act and the income assessed by the A.O. Therefore, the concept of under-reporting of income has to be understood in the context of return of income filed in response to notice under section 148 of the Act, and the income assessed by the A.O., and if we consider the income assessed by the A.O. and the income returned by the assessee, then there is no difference, and therefore, in our considered view, the concept of under-reporting of income for the purpose of section 270A of the Act, does not arise. Further, insofar as the merits of the case are concerned, the assessee was under the bona fide belief that the sale of dry agricultural land and purchase of another agricultural land does not attract tax, and this fact has been explained to the A.O. Therefore, once the amount of income in respect of which the assessee offers explanation and the A.O. is satisfied that the explanation is bona fide and the assessee has disclosed all the material facts, then for the purpose of section 270A of the Act, the under-reporting of income shall not include the income on which the explanation is offered by the assessee. Since the explanation of the assessee with regard to the sale of agricultural land is bona fide, in our considered view, the A.O. ought to have accepted the explanation of the assessee and not levied penalty under section 270A of the Act. The learned CIT(A), without appreciating the relevant facts, simply upheld the penalty levied by the A.O. Thus, we set aside the order of the learned CIT(A) and direct the A.O. to delete the penalty levied under section 270A of the Act.
11. In the result, the appeal of the assessee is allowed.
]]> LLP LAST DATE FOR ANNUAL FILING https://www.taxheal.com/llp-last-date-for-annual-filing.html Sat, 30 May 2026 04:20:24 +0000 https://www.taxheal.com/?p=132180 LLP LAST DATE FOR ANNUAL FILING The last date for an LLP (Limited Liability Partnership) to file its Annual Return (Form 11) with the Ministry of Corporate Affairs (MCA) is 30th May every year. However, “annual filing” for an LLP consists of multiple mandatory statutory compliance forms. The exact deadlines for the standard financial year… Read More »

]]> LLP LAST DATE FOR ANNUAL FILING
The last date for an LLP (Limited Liability Partnership) to file its Annual Return (Form 11) with the Ministry of Corporate Affairs (MCA) is 30th May every year.
However, “annual filing” for an LLP consists of multiple mandatory statutory compliance forms. The exact deadlines for the standard financial year (ending 31st March) are structured as follows:

📅 MCA Annual Filing Deadlines

  • Form 11 (Annual Return)
    • Due Date: 30th May
    • Timeline: Within 60 days from the closure of the financial year.
    • Requirement: Mandatory for all registered LLPs, even those with zero business activity.
  • Form 8 (Statement of Account & Solvency)
    • Due Date: 30th October
    • Timeline: Within 30 days from the end of six months of the financial year.
    • Requirement: Summary of profits, financial data, and declaration of solvency.

💸 Income Tax Return (ITR-5) Deadlines

  • Non-Audit Cases
    • Due Date: 31st July
    • Applicability: LLPs with an annual turnover up to ₹40 Lakhs and partner contributions up to ₹25 Lakhs.
  • Tax Audit Cases
    • Due Date: 31st October (Tax Audit Report must be submitted by 30th September).
    • Applicability: LLPs exceeding the turnover or contribution thresholds mentioned above.

⚠ Consequences of Late Filing

  • MCA Forms (Form 8 & Form 11): A statutory penalty of ₹100 per day, per form is levied automatically from the due date until the actual date of filing, with no maximum limit or cap.
  • Income Tax Return: Late filing attracts interest under Section 234A and an additional late fee of up to ₹5,000 under Section 234F.
You can check your LLP status or upload your forms directly via the official Ministry of Corporate Affairs Portal.
]]> Perplexity vs ChatGPT: The Definitive Core Architecture Comparison https://www.taxheal.com/perplexity-vs-chatgpt-the-definitive-core-architecture-comparison.html Fri, 29 May 2026 14:24:21 +0000 https://www.taxheal.com/?p=132161 Perplexity vs ChatGPT: The Definitive Core Architecture Comparison While both Perplexity and ChatGPT are leading conversational AI interfaces, using them interchangeably is a fundamental mistake. They are built on completely opposite operational frameworks. The easiest way to distinguish them comes down to a simple workflow rule: Perplexity is built to search and cite, while ChatGPT… Read More »

]]> Perplexity vs ChatGPT: The Definitive Core Architecture Comparison

While both Perplexity and ChatGPT are leading conversational AI interfaces, using them interchangeably is a fundamental mistake. They are built on completely opposite operational frameworks.

The easiest way to distinguish them comes down to a simple workflow rule: Perplexity is built to search and cite, while ChatGPT is built to think and create.

🏗 Core Architectural Differences

The primary dividing line between these two platforms isn’t the underlying AI model itself—in fact, both platforms give you access to frontier systems like OpenAI’s GPT architectures—but rather where they pull their knowledge from and how they process your prompt.

 [ Perplexity Loop ] ──► Parses Prompt ──► Scours Live Web ──► Synthesizes with Citations
 [ ChatGPT Loop ]    ──► Parses Prompt ──► Queries Local LLM ──► Generates Original Content

1. Perplexity: The Answer Engine

Perplexity is fundamentally a next-generation search engine with an AI overlay. When you ask Perplexity a question, it acts as a web agent:

  • It translates your prompt into search queries.

  • It searches the live web, indexing real-time news, academic databases, and financial portals.

  • It reads through the top results and synthesizes a concise response where every factual claim is accompanied by an inline, clickable citation link.

2. ChatGPT: The Creative & Analytical Sandbox

ChatGPT is a conversational AI assistant and generalist collaborator. While it can browse the web when explicitly prompted, its default behavior relies on its internal model weights:

  • It focuses on generating highly original text, debugging lines of code, and stepping through logical math constraints.

  • It maintains a massive, continuous conversational memory window, making it excellent for back-and-forth iteration.

  • It uses localized sandbox environments to execute data scripts and manipulate files directly.

📊 Side-by-Side Comparison Matrix

Operational Feature Perplexity AI OpenAI ChatGPT
Primary Category Type AI-Powered Search Engine Conversational AI Assistant / Chatbot
Information Source Real-time web index + premium databases Pre-trained model weights + selective browsing
Factual Verifiability Excellent. Inline citations for every claim. Baseline. Broad text summaries without default links.
Model Architecture Orchestrated Selector: Switch between Sonar, GPT, Claude Sonnet, and Gemini Pro. Proprietary Focus: Powered exclusively by OpenAI’s flagship GPT and reasoning models.
Advanced Data Analytics Basic file reading and data compilation. Advanced. Executes Python code in a sandbox to build graphs or audit files.
Best Used For… Fact-checking, tracking breaking news, and market research. Brainstorming, drafting text, programming, and complex multi-turn problem solving.

🛠 Feature Deep Dive: Where Each Platform Shines

When to Open Perplexity

Perplexity is your optimal tool when you need verifiable, time-sensitive factual precision.

  • Tracking Live News: Asking questions about recent global events, market dips, or political movements that changed hours ago.

  • Aggregated Market Research: Gathering data points like “What are the fastest-growing SaaS verticals by venture funding?” Perplexity will crawl financial journals and deliver a cleanly structured summary with direct source links.

  • Filtering SEO Noise: Bypassing traditional search pages cluttered with ads and affiliate links to pull a straightforward answer.

When to Open ChatGPT

ChatGPT is your optimal tool when you need to transform, generate, or deeply analyze data.

  • Writing and Content Creation: Drafting highly tailored client proposals, long-form articles, specialized scripts, or professional emails using specific tonal instructions.

  • Complex Software Engineering: Generating functional application code blocks, translating code from legacy languages, or troubleshooting errors interactively.

  • Deep Document Auditing: Uploading a 150-page PDF financial audit or a massive Excel sheet and commanding the system to look for mathematical data anomalies or write a summary.

🔮 Summary Checklist: How to Pair Both for Maximum Efficiency

You don’t necessarily have to choose one over the other. The most efficient workflows combine the strengths of both tools:

  1. Phase 1 (Perplexity): Use Perplexity to harvest verified data points, gather historical compliance background, and check recent market numbers along with their source links.

  2. Phase 2 (ChatGPT): Take that gathered data over to ChatGPT and use its deep-reasoning and text-generation engines to draft your final report, presentation outline, or application code.

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