Immunity is available to genuine tax payers under Section 270AA of Income
Tax Act against penalty under section 270A. Those who want to deposit large
amount of cash can go through the provisions.
To get immunity the assessee can make an application, in the prescribed form
with verification the same in prescribed manner, from the end of the month in
which assessment order under section 143(3) of the Act or reassessment order
under section 147 of the Act is received;
Payment of the tax and interest, as demanded, as per the assessment or
reassessment should made within the time specified in Notice of demand issued
under section 156 of the Act
No appeal should be filed against the order of Assessing Officer for
assessment or reassessment;
The Assessing Officer shall pass the order, within one month from the end of
the month in which the assessee makes the application, accepting or rejecting
the application for immunity;
Only Assessing Officer has the power to grant immunity. Commissioner and/or
the Commissioner (Appeals) does not have some such power under the section. Thus
where the penalty is initiated by the Commissioner (Appeals) an application for
immunity under the section cannot be made.
The order rejecting the application shall not be passed without giving an
opportunity of being heard to the assessee;
The order passed under the section would be final; Hence, it cannot be
re-opened or revised or reviewed.
Where the application for immunity is accepted and an order is passed under
the section, no appeal or revision would lie against the assessment or
Where the application is rejected , it should be possible to file an appeal.
Section 249 is amended by the Finance Act 2016 , to exclude the period from the
date of application till the date of service of the order rejecting the
application on the assessee, to determine the period of limitation for filing an
Provisions under Section 270AA of the Income Tax Act
Section 270AA Immunity from imposition of penalty, etc.
270AA. (1) An assessee may make an application to the Assessing Officer to
grant immunity from imposition of penalty under section 270A and initiation of
proceedings under section 276C or section 276CC, if he fulfils the following
(a) the tax and interest payable as per the order of assessment or
reassessment under sub-section (3) of section 143 or section 147, as the case
may be, has been paid within the period specified in such notice of demand; and
(b) no appeal against the order referred to in clause (a) has been filed.
(2) An application referred to in sub-section (1) shall be made within one
month from the end of the month in which the order referred to in clause (a) of
sub-section (1) has been received and shall be made in such form and verified in
such manner as may be prescribed.
(3) The Assessing Officer shall, subject to fulfillment of the conditions
specified in sub-section (1) and after the expiry of the period of filing the
appeal as specified in clause (b) of sub-section (2) of section 249, grant
immunity from imposition of penalty under section 270A and initiation of
proceedings under 276C, where the proceedings for penalty under section 270A has
not been initiated under the circumstances referred to in sub-section (9) of the
said section 270A.
(4) The Assessing Officer shall, within a period of one month from the end of
the month in which the application under sub-section (1) is received, pass an
order accepting or rejecting such application:
Provided that no order rejecting the application shall be passed unless the
assessee has been given an opportunity of being heard.
(5) The order made under sub-section (4) shall be final.
(6) No appeal under section 246A or an application for revision under section
264 shall be admissible against the order of assessment or reassessment,
referred to in clause (a) of sub-section (1), in a case where an order under
sub-section (4) has been made accepting the application.