The Kerala High Court directed to approach the appropriate authority in the matter concerning the passing of order under Section 271AAC (1) of the Income Tax Act, 1961.
The writ petition has been filed impugning order dated 23.03.2023 in respect of the assessment year 2020-21 issued under Section 271AAC(1) of the Income Tax Act, 1961.
Section 271AAC of the Income-tax Act empowers AO or Commissioner (Appeals) to levy penalty at the rate of 10% of the tax payable under section 115BBE if any addition is made under section 68, section 69, section 69A, section 69B, section 69C, section 69D.
It is important to note that the penalty under Section 271AAC is mandatory and cannot be waived by the assessing officer. However, the taxpayer has the right to appeal against the penalty before the Commissioner of Income Tax (Appeals) and then before the Income Tax Appellate Tribunal (ITAT).
A Single Bench of Justice Dinesh Kumar Singh observed that “Admittedly, there is statutory appeal provided under the provisions of the Income Tax Act against the impugned order passed by the assessing authority. This Court has already dismissed W.P.(C) No. 2136 of 2023 impugning the assessment order for the same assessment year and, therefore, there is no ground to entertain this writ petition. In view thereof, this writ petition is disposed of with liberty to the petitioner to approach the appropriate authority against the impugned order, if he so advised.”
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