New Delhi, Nov. 8 -- The Ahmedabad tribunal ruled that disallowing employees' PF and ESI contributions for delayed deposits does not, by itself, establish misreporting of income under Section 270A of the Income-tax Act.

The Income Tax Appellate Tribunal (ITAT), Ahmedabad, has deleted a penalty of Rs.4.42 lakh imposed on an Ahmedabad-based company for allegedly misreporting its income after it claimed employees' contributions towards Provident Fund (PF) and Employees' State Insurance (ESI) as expenses.

In the case of Nascent Info Technologies Pvt. Ltd. v. Income Tax Officer, ITA No. 2906/AHD/2026, the tribunal held on 23 October 2026 that a disallowance of a tax claim does not automatically amount to misreporting of income. The tax depar...