The census is an invaluable source of information for family researchers.
The note in the above 1940 census reinforces that the source of information was not necessarily the enumerated people themselves.
"This line vacant due to misleading information given by neighbor"
I do not know what the misleading information was, or who it concerned.
The note is in between the household of Bernard Burn (usually seen as Burns) and his wife, Ellen. The next household is their daughter, Marjorie, seen here with husband John Lysaght and daughter Anita. They were residing at 127 West 6th Street, Bayonne, Hudson County, New Jersey.
Use census information, but cautiously.