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2015 (9) TMI 1445
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....the returned income of Rs. 67,68,610/- vide an order dated 30.12.2010 under section 153A(l)(b) read with section 143(3) of the Act. The notice dated 30.12.2010 for the initiation of penalty proceedings was served on the assessee wherein the assessee was asked to explain why penalty as per explanation 5-A to section 271(l)(c) of the Act should not be levied as the return has not been filed by the assessee within the due date. Consequently, the penalty under section 271(l)(c) of the Act of Rs. 22,42,867/- was imposed by the Assessing Officer vide his impugned order dated 28.06.2011. 3. Before the learned CIT (Appeals), the assessee was aggrieved that the penalty of Rs. 22,42,867/- was imposed by not considering the fact that being a partner in an audit firm and also in a non-audit Firm, the assessee can file its return of income only after finalization of the Income Tax Return of the Firms. Moreover, the case of the assessee has been assessed at returned income and under such circumstances, there cannot be any levy of penalty under section 271(l)(c) of the Act. The relevant portion of the written submission filed during the appellate proceedings, is reproduced below: 5. The Ass....
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....this Act or under any other law for the time being in force, the [30th day of September] of the assessment year; Thus, it is very much clear from the explanation 2 to section 139 of the Act that the due date for the partners of a firm whose accounts are required to be audited under this Act is 30th September. 8. The very basis for the levy of penalty u/sec 271(l)(c) is not correct as the only point on the basis of which the Assessing Officer has levied the penalty is that the due date of filing of return of income for the AY 2008-09 had expired at the time of search and the assessee had not filed his return of income. But the fact as stated above is that the due date of filing of return of income had not expired in the case of the assessee and thus provisions of explanation 5A to Section 271(l)(c) are not at all applicable in the case of the assessee. 9. Without prejudice to our above arguments that no penalty is leviable as the provisions of explanation 5A to section 271(l)(c) are not applicable, it is further submitted that even otherwise the income was assessed at the income returned in response to notice u/sec 153A of the Act and as such there cannot be any levy of penalt....
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....a concealment or non-disclosure of the particulars of income, penalty cannot be imposed. There is no such concealment or non-disclosure as the assessee had made a complete disclosure in the income tax return and offered the surrendered amount for the purpose of tax." b) Reliance in this regard is also placed on the latest Judgment of the Hon'ble Tribunal, Delhi Bench in the case of Prem Arora vs. DCIT in ITA no. 4702 of 2010 vide order dated 09.03.2012 wherein the Judgment of the Hon'ble High Court has been relied upon and relief has been allowed to the assessee. c) Reliance in this regard is also placed on the latest Judgment of the Hon'ble Tribunal , Delhi Bench in the case of Suman Raheja vs DCIT in ITA no. 4411 & 4412 of 2011 vide order dated 25.05.2012 wherein the Judgment of the Hon'ble High Court (supra) as well the Judgment in the case of Prem Arora (Del Bench) has been relied upon and relief has been allowed to the assessee. 11. If the facts of the case are examined in the light of decision of Hon'ble Delhi high Court in SAS Pharmaceuticals (supra), penalty u/s 271(l)(c) is not imposable where there is neither concealment of income ....
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....ection 271 (1)( c) r/w Explanation 5A, which is reproduced below: 271. Failure to furnish returns, comply with notices, concealment of income, etc. (1) If the Assessing Officer or the Commissioner of (Appeals) or the Commissioner in the course of any proceedings under this act, is satisfied that any person - (a) ............ (b) ......... (c) has concealed the particulars of his income or furnished inaccurate particulars of such income, or (d) .......... Explanation 5A. - Where, in the course of a search initiated under section 132 on or after the 1st day of June, 2007, the assessee is found to be the owner of - (i) Any money, bullion, jewellery or other valuable article or thing (hereafter in this Explanation referred to as assets) and the assessee claims that such assets have been acquired by him by utilising (wholly or in part) his income for any previous year;or (ii) Any income based on any entry in any books of account or other documents or transactions and he claims that such entry represents his income (wholly in part) for any previous year, which has ended before the date of search and,- ....
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....sed the findings of the authorities below. The learned counsel for the assessee reiterated the submissions made before the authorities below and submitted that the Explanation 5-A to section 271(1)(c) of the Act is not applicable in the case of the assessee as there was no entry found in the books of account, for which penalty was initiated. Further Explanation 5-A to section 271(1)(c) of the Act is not applicable in the case of the assessee as the due date of return in the case of the assessee was 30.9.2008, which has not expired on the date of search on 15.7.2008. The assessee has filed the return of income on 31.3.2009. The assessee is a partner in two firms and accounts are audited. Therefore, the due date in the case of the assessee for filing of the return was 30.9.2008, which is also admitted by the learned CIT (Appeals). He has, therefore, submitted that the issue is covered in favour of the assessee by the order of the I.T.A.T., Mumbai Bench in the case of Kshiti R. Maniar Vs. ACIT in ITA No.1020/Mum/2011 for assessment year 2007-08 dated 28.8.2013. He has further submitted that the penalty was levied on the sole reason that the assessee has not disclosed the surrendered a....
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....ve concealed the particulars of his income or furnished inaccurate particulars of income, if he is found to be the owner of any money bullion jewellery or other valuable article or thing acquired by him utilizing his income in any previous year or any income based on entry in any books of account or other documents for any previous year. The relevant provisions of Explanation 5A to section 271(l)(c) is reproduced below:- [Explanation 5A.- Where, in the course of a search initiated under section 132 on or after the 1st day of June, 2007, the assessee is found to be the owner of- (i) any money, bullion, jewellery or other valuable article or thing (hereafter in this Explanation referred to as assets) and the assessee claims that such assets have been acquired by him by utilising (wholly or in part) his income for any previous year; or (ii) 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 ....
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....f income in response to notice under section 153A and which has been assessed also. There is no variation between the return of income and the assessed income, qua this addition. For levying the penalty in cases of search after 1st June 2007, the deeming provisions of Explanation 5A can only be invoked, which clearly carves out the exception in the cases where due date of filing of the return of income had not expired at the time of search. Thus, for levy of penalty under Explanation 5A, it has to be seen whether any assets or income found on the date of search has been acquired out of the previous year and not afterwards for which penalty can be levied or initiated under other provisions of section 271(l)(c). Thus, in our opinion, once the due date had not expired for filing the return of income for the assessment year 2007-08, at the time of search, penalty cannot be levied under the deeming provisions of Explanation 5A. Consequently, we set aside the impugned order passed by the learned Commissioner (Appeals) and hold that on this preliminary ground, penalty levied by the Assessing Officer and as confirmed by the Commissioner (Appeals) cannot be sustained and same is de....