Section 270A

What a section 270A notice is

Penalty — Under-reporting / Mis-reporting. Penalty proposed for under-reporting or mis-reporting income. It is a critical-severity notice in the penalty family under the Income Tax Act 1961.

If you ignore it: Penalty levied. Immunity window may lapse.

Time to reply: this notice type carries no standard period. The date is printed on the notice itself and you must read it off the document. ALWAYS check immunity u/s 270AA — see IMMUNITY below. It is time-barred and routinely missed.

Under the Income Tax Act 2025: section 439. But read that as reference, not as the provision to cite. Under s.536(2) of the 2025 Act, a proceeding for any tax year beginning before 1 April 2026 stays under the Income Tax Act 1961 from the notice through to the appeal — so a notice arriving today for an earlier year is a 1961 Act matter, whatever today's date is.

Section 270A — the law in short

What the courts have decided on section 270A, in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.

• High Vista Buildcon P Ltd v NFAC High CourtHelps taxpayerValidity unconfirmed
  I asked NFAC for a video hearing in my appeal and never got a link. Can that order stand?
  No. A virtual hearing is mandatory once it is specifically requested in faceless appellate proceedings, and passing the appellate order without ever providing the video-conference link violated natural justice. The order was set aside, the appeal restored for a proper virtual hearing, and the consequential penalty orders under ss.271AAC(1) and 270A were quashed with it.
• Vijaya Agro Traders v ITO High CourtHelps taxpayerValidity unconfirmed
  The faceless unit has disallowed my purchases for not deducting under s.194Q and has said nothing at all about the Board's circular I quoted in my reply. Is that enough to get the order set aside?
  Yes. The Karnataka High Court set aside an order under s.143(3) read with s.144B, made in a s.194Q scrutiny, on the single ground that CBDT Circular No. 13/2021 had not been considered or appreciated by the assessing unit, and remitted the matter for fresh consideration in the light of that circular. Guidelines issued under s.194Q(3) are issued with the approval of the Central Government and the officer is not free to pass over them in silence.
• GE Capital US Holdings Inc v DCIT High CourtHelps taxpayerValidity unconfirmed
  The officer refused immunity under s.270AA saying the penalty was for misreporting. Must he show which clause of s.270A(9) applies?
  Yes. The Delhi High Court held that once the assessee complies with clauses (a) and (b) of s.270AA(1) - paying the tax and interest and not appealing - the officer must reach a firm conclusion that the case falls in the category of misreporting, because that alone warrants rejection of the immunity application. Here neither the assessment orders nor the show cause notices contained any finding answering any of the six clauses of s.270A(9); the notices alleged 'under-reporting/misreporting' in the alternative and invoked both s.270A(2) and s.270A(9), which made them vague. The Court quashed both the rejection orders and the show cause notices. It also held that a legal position taken on the strength of a binding High Court decision, later vindicated by the Supreme Court, is not misreporting.
• Chambal Fertilizers and Chemicals Ltd v PCIT, Udaipur High CourtHelps taxpayerValidity unconfirmed
  Can the officer reject a s.270AA immunity application without a hearing and without saying which clause of s.270A(9) applies?
  No. The Rajasthan High Court held that the Deputy Commissioner had violated the proviso to s.270AA(4) by giving no opportunity of hearing, that his order was wholly laconic and did not indicate under which part of s.270A(9) the case was said to fall, and that the revisional authority had, without cogent reasons, cursorily placed the case within clauses (a) and (c). On the facts the amount had not been detected by the department at all - it was disclosed voluntarily during scrutiny after ten other issues had been raised without any addition - so clauses (a) and (c) were not attracted. The Court quashed both orders and directed that immunity under s.270AA be granted.
• Virdichand Bawandas HUF v National e-Assessment Centre High CourtHelps taxpayer
  You asked for time to reply to the draft order and were refused. Is the final order safe?
  No. The scheme requires an opportunity to respond to the modifications proposed in the draft order. Refusing time and then finalising was held wrong, and the assessment and the penalty notice were set aside.
• Prem Brothers Infrastructure LLP v National Faceless Assessment Centre High CourtHelps taxpayerValidity unconfirmed
  The Assessing Officer raised my own section 14A disallowance and then called it misreporting, so he refused me immunity under section 270AA and levied penalty under section 270A. Can he do that?
  No. The Delhi High Court quashed the penalty order and directed the Assessing Officer to grant immunity under section 270AA. The only addition was a recomputation of a section 14A disallowance the assessee had itself estimated and disclosed. Both sides worked from the same details and reached different figures; the Court said that by no stretch of imagination can that be called misreporting. It also found that the penalty order did not say which limb of section 270A was attracted or how sub-section (9) was satisfied, and that the bare use of the word misreporting made the order manifestly arbitrary.
• Schneider Electric South East Asia (HQ) Pte Ltd v ACIT High CourtHelps taxpayerValidity unconfirmed
  Immunity under s.270AA was refused because the officer called it 'misreporting'. Can they do that with one word?
  No. Denying immunity on a bare label of misreporting, without identifying which limb of s.270A or which sub-clause of s.270A(9) is attracted, was held manifestly arbitrary. The Court directed that immunity be granted.
• Mantra Industries Ltd v NFAC High CourtHelps taxpayerSuperseded by amendment
  The faceless order says I filed no reply when I did, and my hearing request was ignored. Is it valid?
  It was set aside. The final order reproduced the draft order word for word apart from one sentence, recorded that no response had been filed when two replies were on the record, and ignored the requests for adjournment and personal hearing — so it was held non est under s.144B(9) as it then stood. The Court warned that costs would be recovered from the Assessing Officer personally and entered in the service record if it recurred.
• Mayur Bhararbhai Popat v ITO ITATHelps departmentValidity unconfirmed
  I applied for immunity under s.270AA after paying the tax on the s.80GGC disallowance. The Assessing Officer refused it because he had charged misreporting. Was he entitled to?
  Yes, on this decision. Section 270AA(3) grants immunity only where penalty proceedings under s.270A have NOT been initiated in the circumstances in s.270A(9). Once the Assessing Officer invokes s.270A(9), the statute itself excludes immunity, and the 200 per cent penalty under s.270A(8) follows. The qualification is important: where the invocation of s.270A(9) is a bare label with no clause identified and no reasoning on its ingredients, the Delhi High Court in Prem Brothers Infrastructure LLP v NFAC (W.P.(C) 7092/2022, 31 May 2022) quashed the penalty and directed immunity to be granted — so the battleground is the quality of the initiation, not the availability of s.270AA in the abstract.
• Mithibai College Employees Co-operative Credit Society Ltd v ITO ITATHelps taxpayerValidity unconfirmed
  The notice said under-reporting; the order said misreporting. Can the charge change between them?
  No. The enhanced penalty for misreporting is available only if the case falls within a named sub-clause of s.270A(9), and the officer must say which. Shifting to a heavier charge in the order, having alleged only under-reporting in the notice, sank the penalty.
• Uday Garudachar v ITO ITATHelps taxpayerValidity unconfirmed
  My client set off the whole house property loss against salary for AY 2018-19, not knowing about the new Rs 2,00,000 cap. The officer restricted it and has levied a s.270A penalty for under-reporting. Can the penalty be resisted?
  Yes, on this authority. The Bangalore Tribunal deleted a s.270A penalty where the assessee had disclosed the whole computation of house property income but had set off the loss in full because he was unaware of s.71(3A), which had been inserted with effect from assessment year 2018-19 — the very year in issue. The explanation was held bona fide within s.270A(6), so the addition did not amount to under-reported income.
• Niket Maheshbhai Shah v ITO ITATHelps taxpayerValidity unconfirmed
  I gave up the fight on the s.80GGC disallowance and paid the tax. Now there is a 200 per cent penalty under s.270A for misreporting. Can I still resist the penalty?
  Yes. The Tribunal quashed the penalty outright. Claiming a deduction the assessee genuinely believed was available is not under-reporting or misreporting, and where the penalty order does not say which limb of s.270A(9) is attracted or how its ingredients are satisfied, the order is arbitrary and cannot stand.
• Capgemini Technology Services India Ltd v ACIT ITATHelps taxpayerValidity unconfirmed
  I claimed cess before the 2022 amendment and filed Form 69. Can they still levy s.270A penalty?
  No. A cess claim made in good faith on High Court authority that was binding when the return was filed is not under-reported income, and the proviso to s.155(18) gives statutory immunity where Form 69 was filed and the recomputed tax paid.
• Alrameez Construction P Ltd v CIT/NFAC ITATHelps taxpayer
  The only addition is the gap between the stamp duty value and my price. Can that carry a s.270A penalty?
  No, on this Tribunal's reasoning, and note the facts it rests on. The Tribunal read s.270A as dealing with deemed income only where the addition is made under s.115JB or s.115JC, so an addition under s.43CA read with s.56(2)(x) falls outside the under-reporting scheme; where a deeming provision applies the assessee has no option but to accept the difference, so neither concealment nor under-reporting can be established. Two further grounds carried the result: the notice never said which limb of s.270A was charged, and the assessment order itself recorded that the assessee had accepted the addition to buy peace. The penalty of Rs. 20,843 was deleted; the addition of Rs. 1,34,100 stands.

Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.