Appeal allowed as income voluntarily declared without notice. Penalty under section 271(1)(C) deleted.

The ITAT allowed the appeal, ruling that the appellant cannot be penalized for non-disclosure as the income was voluntarily declared in the revised return without prior notice under section 148. The ITAT emphasized that taxes were paid with interest, and the revised return was not in response to a notice. Consequently, the ITAT directed the AO to delete the penalty imposed under section 271(1)(C) of the Act.

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Issues:
Challenge against penalty imposed under section 271(1)(C) of the Act for non-disclosure of income from the sale of a shop in the original return of income.

Analysis:
The appellant contested the penalty of Rs. 2,36,914 imposed by the AO under section 271(1)(C) of the Act for not disclosing income from the sale of a shop in the original return. The appellant revised the return, declaring the income subsequently. The AO initiated penalty proceedings, citing failure to fully disclose income. The CIT(A) upheld the penalty, stating inaccurate particulars were furnished. However, the ITAT found that the appellant voluntarily revised the return without prior notice under section 148. The ITAT noted that the taxes were paid along with interest, and the revised return was not in response to a notice. The ITAT concluded that the appellant cannot be penalized for non-disclosure since the income was offered in the revised return without a prior notice. Therefore, the ITAT set aside the CIT(A) order and directed the AO to delete the penalty.

In summary, the ITAT allowed the appeal, emphasizing that the appellant cannot be penalized for non-disclosure when the income was voluntarily declared in the revised return without prior notice under section 148. The ITAT highlighted that the taxes were paid along with interest, and the revised return was not filed in response to a notice. Consequently, the ITAT directed the AO to delete the penalty imposed under section 271(1)(C) of the Act.

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