Farah Khurshed Titina v. ITO: Assessee satisfying statutory conditions is entitled to penalty waiver under Section 270AA following Finance Act amendment.

38. Farah Khurshed Titina v. ITO:

TS-1602-HC-2026 (Bom.):

A. Y. 2024-25: Date of order 05/10/2026:

Ss. 270A, 270AA, 276C and 276CC of the ITA 1961

Penalty u/s. 270A for under reporting which is in consequence of misreporting of income — Immunity u/s. 270AA from imposition of penalty and initiation of prosecution proceedings u/s. 276C and 276CC — Amendment made vide Finance Act 2026 — Waiver of penalty for misreporting of income — After penalty order has been passed — Conditions to be satisfied — Once all the conditions for immunity are satisfied the fresh application for waiver cannot be rejected on the ground that the assessee’s earlier application u/s. 270AA for immunity (prior to the amendment) had been rejected — The amendment gave rise to fresh cause of action as application can be filed within one month from the end of the month in which penalty order is passed — Assessee was entitled to waiver of penalty.

In the scrutiny assessment proceedings for A. Y. 2024-25, the assessee realised that she had made inadvertent claims under Chapter VI-A and on realising the error, she filed a revised computation of total income and voluntarily paid tax and interest.