TaxTMI 
TaxTMI 
2015 (6) TMI 351
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.... are as under: Sr. No. Asst. Year Penalty Levied 1 2002-03 1,25,00,000 2 2004-05 68,12,973 3 2005-06 55,00,000 4 2006-07 25,00,000 2. Since the facts in all the above appeals are identical, we propose to dispose off the appeals vide this common and consolidated order for the sake of convenience and brevity. 3. The facts are, that the primary facts, that the assessee company acquired IPR by the process of amalgamation of another company, consequent to swap ratio for the merger, as approved by the Hon'ble Madras High Court and Hon'ble Bombay High Court. 4. IPRs as acquired by the assessee was capitalized by the assessee company in its books, on which the assessee claimed depreciation. 5....
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....e AR submitted the facts, as to how the impugned appeals have reached the ITAT. The AR submitted that the AO has primarily relied on Explanation 5A to section 5A to section 271(1)(c) and submitted that Explanation 5A to section 271(1)(c) cannot be applied because the Explanation states, "where, in the course of search initiated under section 132 on or after 1st day of June, 2007, the assessee is found to be the owner of- "i) any money, bullion, jewellery or other valuable article or they (hereafter in the Explanation referred to as assets) and the assessee's claim that such assets have been acquired by him by utility/wholly or in part) his income for any previous year, or (ii) any income based on any entry in any books of account or o....
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....ment could not be construed as material found during the course of search operations for the purpose of Chapter XIVB. 14. The AR also placed reliance on the decision of Hon'ble Madras High Court in the case of SMJ Housing vs CIT, reported in 357 ITR 698 (Mad) , wherein it was held that when in a case where the department accepted the return, as filed by the assessee prior to search, and there is nothing in evidence to show that any incriminating material has been found in the search, then Explanation 5 to section 271(1)(c) cannot be attracted. The AR pointed out that Explanation 5 is pari materia to Explanation 5A, which has been imported by the CIT(A) to sustain the penalty order. The AR pointed out that the Hon'ble Madras High Court se....
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....y the CIT(A). The Director Mr. Jignesh Shah withdrew the claim of depreciation in the statement under section 132(4) during the course of search and seizure operations undertaken on the assessee. In 153A proceedings, the AO once again added the same but in these proceedings, the CIT(A) sustained the order of the AO. The AO as a consequence of the orders in 153A proceedings initiated and levied the penalty under section 271(1)(c). 18. On the above facts, we have to ascertain, as to whether at all penalty is leviable on the assessee, on the undisputed and undisturbed facts and figures, already within the knowledge of the revenue authorities. 19. We find that on the date of search, when Mr. Jingnesh Shah director of the assessee....
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....any income based on any entry in any books of account or other documents or transactions and he claims that such entry in the books of account or other documents or transactions represents his income (wholly or in part) for any previous year, which has ended before the date of search and,- (a) where the return of income for such previous year has been furnished before the said date but such income has not been declared therein; or (b) the due date for filing the return of income for such previous year has expired but the assessee has not filed the return, then, notwithstanding that such income is declared by him in any return of income furnished on or after the date of search, he shall, for the purposes of imposition of a penalty unde....
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....a legal charge on the intangible assets, as acquired by the assessee. 25. In so far as depreciation is concerned, it is an allowable legal charge, which had been accepted and allowed by the CIT(A) in regular round of proceedings. Since it has been disallowed now, it falls within the precinct of (i) change of opinion, and (ii) in case of a legal claim of a legal charge. 26. A legal claim and change of opinion by the revenue authorities on a given subject, cannot partake the character of concealment and/or furnishing of inaccurate particulars of income, hence penalty is not exigible. 27. Even when we try to examine the correctness of levy of penalty through the window of quantum, the instant case of levy of penalty is a result ....