2016 (6) TMI 87

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.... 2004-05 & 2006-07 respectively. Since common issues (except quantum) and facts are involved in these appeals, these are being disposed of by way of this consolidated order for the sake of convenience. 2. First, we take up the appeal, i.e. Assessee's appeal in IT(ss)A No.574/Ahd/2012 as a lead case. 2.1. Briefly stated facts as culled out from the material on record as under: A search operation u/s.132(1) of the Act was conducted in the cases of Sanjay RShah & Meghmani Group on 22/09/2005 and various documents/books of account/other valuable articles/other things were found and seized from the various premises covered u/s.132(1) and 133(1A) of the Act. The documents seized during the course of search, also related to payments of Sa....

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....her material or basis for the income declared and it was an adhoc declaration then the same cannot be a basis for levy of penalty. In the case of the appellant, from a perusal of the appellate order and the assessment order u/s.143(3) read with s.153C it is seen that the addition were made based on data found on the Pen Drive when was recovered during the course of search. On the basis data on the Pen Drive if addition ware made then it is clear that the additional income declared by the appellant before the Settlement Commission would even otherwise have come to the knowledge of the Department/ In view of the above the ratio of the decision of the Hon'ble ITAT, Mumbai would not be applicable for this year. The addition income offered for t....

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....the outset, the ld.AR submitted that on identical facts and arising out of same search, addition were made in case of Alkesh Patel and on those additions similar penalty u/s.271(1)(c) of the Act was levied by AO. When the matter was carried before Tribunal, the Coordinate Bench of Tribunal in appeal bearing IT(SS)A Nos./579 & 580/Ahd/2012 for AYs 2002-03 & 2003-04 by order dated 29/01/2016 deleted the penalty. She also placed on record a copy of the aforesaid order. She therefore submitted that since the facts of the present case are identical to the facts of the case of Alkesh M.Patel(supra), therefore following the decision of the Coordinate Bench of Tribunal in the case of Alkesh Patel (supra) the penalty levied u/s.271(1)(c) of the Act ....

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.... the same. This has led to assessment of the-impugned sum in his hands as undisclosed income. We reiterate that he already admitted the same as income before the Settlement Commission. The Revenue strongly draws support from this action. There can hardly be any dispute about the settled legal position that quantum and penalty proceedings stand on different footing and each and every addition of undisclosed income does not lead to imposition of penalty. We observe in these facts and circumstance that we are dealing with a tax statute wherein levy of penalty by invoking a penal provision after finalization of quantum is not automatic. We view the case from this angle and hold that the present one is an instance where assessee has not been abl....