TaxTMI 
TaxTMI 
2011 (1) TMI 171
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....llenged the order of the learned CIT (Appeals) where by the learned CIT (Appeals) confirmed the order of the AO imposing penalty on assessee u/s. 271 (1) (c) of the Act. The facts and circumstances under which penalty was imposed on the assessee by the AO are as follows :- 3. The assessee is a company engaged in the business of coal rolling manufacturing. There was a search and seizure operation u/s. 132 of the Income Tax Act, 1961 (the Act) carried out by the department in the business premises of the assessee on 17.11.2005. In the course of search, statements of directors were recorded. Based on the incriminating documents found in the course of search, the assessee had through its director, offered an additional income on account....
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.... Less: Set off of b/f losses Rs.4,21,55,790/- Rs.6,47,43,644/- Rs.6,47,43,644/- Total Income Rs. NIL Rs.58,12,150/- Rs.58,12,150/- Book Profit u/s.115JB Rs.2,93,91,564/- Rs.2,93,91,564/- Rs.2,93,91,564/- 4. In respect to the income disclosed by the assessee in return of income filed after the search towards loose papers found in the course of search, the AO initiated penalty proceedings u/s. 271 (1) (c) of the act and also imposed penalty by holding that the assessee concealed particulars of income. On appeal by the assessee, the learned CIT (Appeals) confirmed the order of the AO. Against the order of the learned CIT (Appeals) assessee has filed the present appeals before the Tribunal. The grounds of appeal raised by the asses....
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....rbitrary, unjustified, improper, bad in law and deserves to be quashed. 2. The appellant further craves leave to add, alter and/or to amend the aforesaid grounds of appeal as and when required." 5. Though submissions were made on the applicability of explanation-5 to Sec.271(1)(c) of the Act, and also general submissions with regard to imposing of penalty, we deem it appropriate for taking up for consideration Ground (c). 6. As already stated the income of the assessee was ultimately determined as per the provision of section 115 JB of the Act and not as per the normal provisions of the act. It is also not in dispute that the penalty was ultimately imposed on the assessee in respect of the computation of income under....
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....tax is payable with reference to such income. If the tax payable under the normal provisions is higher, such amount is the total income of the assessee, otherwise 'book profits' are deemed as the total income of the assessee in terms of section 115JB. In the instant case, the income computed as per the normal procedure was less than the income determined by legal fiction, namely, 'book profits' under section 115 JB[Para 22] The income of the assessee was, thus assessed under section 115 JB and not under the normal provisions. It was in that context that the application of Explanation 4 to section 271(1)(c) had to be examined. The judgment in the case of Gold Coin Health Food (P) Ltd.(supra) obviously, does not deal with such a situa....