Search-linked penalty under section 271AAB fails where no section 132 search was initiated against the assessee.

Penalty under section 271AAB of the Income-tax Act could not be imposed unless a search had been initiated against the assessee under section 132. The court read the provision as applying only to the person on whom the search was conducted, and held that proceedings arising through section 153C after a search in another concern did not substitute for the statutory requirement of a search against the assessee. The Tribunal's view was found consistent with the plain language of the provision, and the challenge to its order was rejected.

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Issues: Whether penalty under section 271AAB of the Income-tax Act, 1961 can be imposed when no search under section 132 of the Income-tax Act, 1961 was initiated against the assessee and the assessment arose from proceedings under section 153C of the Income-tax Act, 1961.

Analysis: Section 271AAB applies to cases where search has been initiated under section 132. The statutory language was read as requiring a search against the assessee on whom penalty is sought to be levied. In the present matter, the search was conducted in the case of a different concern, and the assessee was brought into the assessment process through survey and notice under section 153C. Such consequential proceedings could not be treated as a substitute for a search on the assessee for the purpose of penalty under section 271AAB. The consistent view taken by the Tribunal was found to accord with the plain meaning of the provision.

Conclusion: Penalty under section 271AAB could not be sustained against the assessee in the absence of a search under section 132 initiated against it, and the challenge to the Tribunal's order was rejected.

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