2016 (5) TMI 1247

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....eedings under section 271(1)(c) of the Income Tax Act, 1961; in short "the Act". Both parties are in unison during the course of hearing that these two appeals raise identical issue of validity of the impugned penalty on facts and law. We treat ITA 579/Ahd/2012 as the lead case in these facts and circumstances. 2. This assessee-individual worked with M/s Meghmani Group as its manager (import/export) on salary basis. The department carried out a search in this group's case on 22-09-2005. It would recover alleged incriminating material in the shape of a diary/pen drive reveals assesee's name and personal memorandum. The department would also record statement of Mr. Lalit K. Patel from whose resident some notings regarding has been recov....

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....t Commission to avoid litigation. All this failed to convince the assessing authority. It rejected the same after holding that section 153C reasons stood supplied, M/s. Meghmani Group have habitually of earning unaccounted income by way of overpricing its purchases and understatement of sales. An inference was drawn that its employees' integral part of all this plot. The Assessing Officer was of the view that there was no evidence of incurring of the expenditure qua the corresponding limits as stated hereinabove. And that assessee was a salaried employee not entitled to claim any corresponding income thereto. The assessment order dated 30-09- 2009 accordingly treated the alleged expenditure sum limit salary and bonus thereby adding the impu....

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....ther the facts of the instant case amount to concealment of income or furnishing of inaccurate particulars. He accordingly prays for acceptance of the instant appeal. The Revenue strongly supports the lower authorities' action in imposing the impugned penalty. 6. We have heard rival contentions. Relevant facts set out hereinabove are not repeated for the sake of brevity. There is no dispute that assessee as well as his employer have been stating that this undisclosed income is in fact an expenditure limit allowed to be incurred to the respective employees. There is no evidence quoted in the shape of incriminating material or otherwise which could prove that assessee's employer has not booked the corresponding sum as expenditure in its ac....