TaxTMI 
TaxTMI 
2018 (1) TMI 230
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 47,29,928/- for the Assessment Year 2011-12. Subsequently, the assessee filed revised return declaring total income of Rs. 56,00,580/- for Assessment Year 2010-11 and Rs. 98,04,184/- for Assessment Year 2011-12 on 19/04/2012 by offering additional income of Rs. 32,44,204/- and Rs. 47,28,928/- for Assessment Years 2010-11 & 2011-12 respectively as agreed during survey. The Assessing Officer subsequently issued notice under section 148 for the Assessment Years 2010-11 & 2011-12 on 18/06/2012. The Assessing Officer has initiated the assessment proceedings for the Assessment Year 2010-11 and has accepted the total income returned in revised return subject to meagre addition of Rs. 12,101/- towards interest income. Thereafter, the Assessing Officer has initiated penalty proceedings under section 271(1)(c). 3. In response to the notice issued by the Assessing Officer, the assessee has filed a letter dated 12/08/2014 and submitted that the assessee himself offered additional income during the course of survey operation, he is in a state of mental agony and stress without proper guidance and accounting knowledge. It was also submitted that the additional income was offered before the Dep....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Parner on 29/03/2012 & 30/03/2012. The perusal of the sworn statements indicate that the assessee was questioned on the low profit declared for Assessment Years 2010-11 & 2011-12. The assessee has explained that the profit was declared as per bills & vouchers maintained. It was also explained that the hospital was showing profit due to the Arogyasri Receipts, and that but for the Arogyasri receipts the hospital was incurring loss. It was also explained that the Arogyasri receipts are given in respect of in-patinets, and that it does not cover the expenses incurred towards the out-patients. The assessee was questioned about self-made vouchers for the expenses, to which the assessee had explained that due to the nature of expenditure it was not possible to obtain receipts from each and every person and hence self-made vouchers were maintained, and to cover any discrepancies voluntarily offered income at the rate of 21.5% of Arogyasri receipts and later to 31.5% and offered to tax the said additional income. Subsequently, the assessee on his own filed revised returns for Assessment Years 2010-11 & 2011-12, returning the additional income for tax. 5.1 It is further noted that the a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ces towards productive work and to make amicable settlement with the income tax department. Statute does not recognize those types of defence under the explanation 1 to section 271(1)(c) of the Act . It is trite law that the voluntary disclosure does not release the appellant-assessee from the mischief of penal proceedings. The law does not provide that when an assessee makes a voluntary disclosure of his concealed income, he had to be absolved from penalty. 9. We are of the view that the surrender of income in this case is not voluntary in the sense that the offer of surrender was made in view of detection made by the Assessing Officer in the search the search conducted in the sister concern of the assesses. In that situation, it cannot be said that the surrender of income was voluntary. AG during the course of assessment proceedings has noticed that certain documents comprising of share application forms, bank statements, memorandum of association of companies, affidavits, copes of Income Tax Returns and assessment orders and blank share transfer deeds duty signed, have been impounded in the course of survey proceedings under Section 133P conducted on 16.12.2333, in the case o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ny incriminating material. The only discrepancy noted was that some of the vouchers for expenses were self-made. The assessee was questioned for showing low profit without reference to any incriminating material. The assessee has satisfactorily explained that the expenditure was claimed as per bills & vouchers manned, and that some of the vouchers were self-made due to the nature of expenses. The assessee has also explained the basis for the profit declared by it, however to cover any discrepancies towards self-made vouchers, additional income was offered. It is also noted that the assessee voluntarily filed returns of income offering the additional income on 194.2012, soon after the survey operations dated 283.2012 and before the issue of notice u/s. 148 dated 18.6.2012, During the assessment proceedings, the AD had called for the production of books of accounts & vouchers and did not point to any discrepancy, but accepted the revised income offered. Thus it could be seen that the assessee has offered satisfactory explanation and the explanation given by the assessee was not found to be false. There is no reference or finding in the assessment order or In the penalty orders, that ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed that the Assessing Officer has rightly imposed penalty under section 271(1)(c) of the Act. He strongly supported the order of the Assessing Officer. 9. Per Contra, learned Authorized Representative for the assessee has submitted that the department has not found any material to show that the assessee has concealed the income. Therefore, penalty under section 271(1)(c) cannot be levied. The assessee himself offered an income to buy a peace and whatever income offered by the assessee is accepted and assessment is completed, hence, no penalty can be levied. It was further submitted that Assessing Officer had not brought any evidence on record to show that what is the income concealed by the assessee. The Assessing Officer simply initiated the penalty proceedings by following the decision of the Hon'ble Supreme Court in the case of MAK Data Pvt. Ltd., (supra), therefore, he prayed that penalty levied by the Assessing Officer may be deleted and he strongly supported the order passed by the ld. CIT(A). 10. We have heard both the sides, perused the material available on record and orders of the authorities below. 11. There is a survey in the case of the assessee and the statemen....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ata Pvt. Ltd., (supra) is entirely different from the instant case. In the MAK Data Pvt. Ltd., (supra) a survey took place in the assessee sisters concern, wherein certain incriminating documents such as blank share transfer deeds duly signed and share application forms etc. pertaining to the assessee were found and the assessee was questioned on these incriminating information during the course of assessment proceedings, the assessee surrendered the additional income. The above judgment of the Hon'ble Supreme Court has considered by the Hon'ble Madras High Court in the case of CIT Vs. M/s.Gem Granites (262 ITR 426) and observed that the Hon'ble Supreme Court while considering the Explanation to section 271(1)(c) held that the question would be whether the assessee had offered an explanation for concealment of particulars of income or furnishing inaccurate particulars of income and the Explanation to Section 271(1) raises a presumption of concealment, when a difference is noticed by the Assessing Officer between the reported and assessed income. The burden is then on the assessee to show otherwise, by cogent and reliable evidence and when the initial onus placed by the ....