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2014 (11) TMI 1031
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....ing to the assessment year 2010-11. 2. In this appeal, the solitary dispute relates to the action of the CIT(A) in deleting the penalty of Rs. 45,00,000/- imposed by the Assessing Officer u/s 271AAA of the Act. 3. In brief, the relevant facts are that assessee is an individual engaged in the business of real estate and is a part of the Tapadiya Group which was subject to a search and seizure action u/s 132 of the Act on 19.01.2010. In the course of search, assessee surrendered an income of Rs. 4,50,00,000/- in the course of a deposition made u/s 132(4) of the Act. The said declaration was on account of the investment made by the assessee as a capital contribution in M/s Neelvasu Holiday Resorts & Properties. Subsequently, assessee als....
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....re the date of search, but the date of filing of the return u/s 139(1) of the Act has not expired before the date of search and assessee has not furnished the return of income for the said year before the said date or the previous year in which the search was conducted. In the present case, search u/s 132(1) has been conducted in the case of assessee on 19.01.2010 and therefore the previous year relevant to the assessment year under consideration i.e. 2010-11 is the 'specified previous year' for the purposes of section 271AAA of the Act. On this aspect of the matter, there is no dispute. The dispute pertains to the immunity from the penalty envisaged by way of sub-section (2) of section 271AAA of the Act, which reads as under :- ....
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....f section 271AAA of the Act has been complied with. 7. In order to appreciate the charge made by the Assessing Officer it would be appropriate to notice that the undisclosed income of Rs. 4,50,00,000/- declared in the statement made u/s 132(4) of the Act was offered in the return of income filed on 09.02.2011. In the return of income so filed the tax and the interest payable was Rs. 1,31,09,218/-. The assessee had paid an amount of Rs. 1,26,64,814/- and in respect of the balance, assessee contended that the cash of Rs. 11,00,000/- seized in the course of search be treated as advance tax. The aforesaid claim was made in the return of income and the computation of income filed. It also transpires from the orders of the authorities below th....
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....osed income surrendered in the statement recorded u/s 132(4) of the Act. 9. Per contra, the Ld. Representative for the respondent-assessee pointed out that the CIT(A) made no mistake in deleting the penalty by relying upon the ratio of the judgement of the Hon'ble Supreme Court in the case of ACIT vs. Gebilal Kanhaialal HUF, 348 ITR 561 (SC). According to the Ld. Representative, the Hon'ble Supreme Court was considering a similar condition contained in Explanation 5 to section 271(1)(c) of the Act and it was held that there was no time limit prescribed for payment of such tax and even if it is accepted that the seized cash is to be adjusted in respect of the liability after completion of assessment, then also the condition laid d....
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....ther with interest". Factually, it was clear that the said condition stood fulfilled as assessee had paid tax with interest upto the date of payment. Therefore, the Hon'ble Supreme Court held the assessee was entitled to the immunity from payment of penalty in terms of clause (2) of Explanation 5 to section 271(1)(c) of the Act. In the present case too wherein the issue relates to levy of penalty u/s 271AAA of the Act, the condition prescribed in clause (iii) of sub-section (2) of section 271AAA of the Act is pari- materia to the third condition prescribed in clause (2) of Explanation 5 to section 271(1)(c) of the Act. Therefore, in our considered opinion the ratio of the judgement of the Hon'ble Supreme Court in the case of Gebilal....