Section 270a
This query is : Resolved
29 September 2020
Dear Experts, I have a small query regarding section 270a, if someone has not filed his return does in that case will it be considered as Under reporting only or can it also be considered as Misreporting?
Thanks in advance
Thanks in advance
29 September 2020
If return is not furnished, and Income is assessed at an amount which is more than the maximum amount not chargeable to tax, it comes under UNDER REPORTING for the purpose of 270A.
29 September 2020
Thank you sir for your reply, in that case penalty will be 50% or A.O. can also levy penalty of 200%
23 July 2025
Great follow-up question! Here's a clear breakdown of Section 270A of the Income Tax Act, 1961:
🔍 Case: Return Not Filed at All
If an assessee fails to file the return and the assessed income exceeds the basic exemption limit, then:
✅ It is treated as:
"Under-reporting of income" under Section 270A(1) r/w 270A(2)(a)
💸 Penalty Consequence (as per 270A(7)):
Type Penalty Rate When it applies
Under-reporting 50% of tax on under-reported income Default situation
Misreporting 200% of tax on under-reported income Only when misreporting is proved (like bogus entries, false expense claims, etc.)
🚫 Is Non-filing = Misreporting?
Not automatically.
Non-filing is generally treated as under-reporting, not misreporting, unless:
There is intentional concealment, or
Evidence of false entry, bogus claim, suppression, etc.
In such cases, the AO may invoke Section 270A(9) (misreporting), but burden of proof lies with the AO.
🧾 Example:
Mr. A doesn’t file return.
His income is later assessed at ₹7,50,000 (exceeds ₹2.5L exemption limit).
Tax on ₹7.5L = say ₹52,500.
Penalty @ 50% = ₹26,250 (under-reporting).
Only if AO proves misreporting, penalty = ₹1,05,000 (200%).
✅ Summary:
Condition Penalty u/s 270A
Return not filed, no fraud 50% of tax (under-reporting)
Return not filed + proven misreporting 200% of tax
🔍 Case: Return Not Filed at All
If an assessee fails to file the return and the assessed income exceeds the basic exemption limit, then:
✅ It is treated as:
"Under-reporting of income" under Section 270A(1) r/w 270A(2)(a)
💸 Penalty Consequence (as per 270A(7)):
Type Penalty Rate When it applies
Under-reporting 50% of tax on under-reported income Default situation
Misreporting 200% of tax on under-reported income Only when misreporting is proved (like bogus entries, false expense claims, etc.)
🚫 Is Non-filing = Misreporting?
Not automatically.
Non-filing is generally treated as under-reporting, not misreporting, unless:
There is intentional concealment, or
Evidence of false entry, bogus claim, suppression, etc.
In such cases, the AO may invoke Section 270A(9) (misreporting), but burden of proof lies with the AO.
🧾 Example:
Mr. A doesn’t file return.
His income is later assessed at ₹7,50,000 (exceeds ₹2.5L exemption limit).
Tax on ₹7.5L = say ₹52,500.
Penalty @ 50% = ₹26,250 (under-reporting).
Only if AO proves misreporting, penalty = ₹1,05,000 (200%).
✅ Summary:
Condition Penalty u/s 270A
Return not filed, no fraud 50% of tax (under-reporting)
Return not filed + proven misreporting 200% of tax
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Unanswered Queries
- ITC Re-claimable Ledger
- F & O Loss Audit Requirement
- Make-up ITC- Eligibility
- Overtime income in salaried person case
- New tax regime and old tax regime.
- RCM invoice related QRMP
- Regarding GST applicability on RWA
- Rectification of error U/s 154
- BUSINESS +STOCKS
- Upload Verification Error ITR 3 AY205-26
- GST registration /aadion a new place of business in the same state and city
- CSR Applicability FY 2425
- Late fee CMP-08 FY 2021-22
- Mismatch in gstr-1 and eway bill invoice no
- Clarification Regarding Tax Deduction at Source on Receipt Against Issuance of Privilege Voucher
- GST TDS on metal scrap
- ITC Inter head difference
- 80CCD(2) of IT ACT
- Guidance for proper GST accounting (eway bill with correct valuation) for cut-to-pack job work given
- GST Treatment multiple delivery services
Trending Online Classes
-
Input Tax Credit, GST refunds and Recovery of refunds- Roadblocks and way outs
CA Nipun Arora03 September 2025 -
GST LIVE Certification Course - 43rd Weekdays Batch(With Govt Certificate)
Industry Expert15 September 2025
CAclubindia
