2017 (9) TMI 1653

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....ty of Rs. 13,00,990/- levied under section 271(1)(c) of the Income Tax Act. 1961 in respect of alleged undisclosed income added u/s 69 on voluntary surrender made by the appellant. The Id. CIT(Appeals) failed to appreciate that the appellant's main source of income was from Salary and that the surrender of amounts borrowed and deposited in hank account was made for the valid reasons. The Id. CIT(Appeals) ought to have accepted the plea raised and deleted penalty. 2. The Id. CIT(Appeals) erred in law and on facts in confirming the order levying penalty u/s. 271(1)(c) when the explanation furnished by the appellant was not found to he false and since penalty proceedings are quite independent of assessment proceedings, the penalty....

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.... as income of the assessee. The matter did not stop there. Assessing Officer also imposed penalty of Rs. 13,00,990/- being equivalent to 100% tax sought to be evaded in respect of such income. Aggrieved, assessee carried the matter in appeal before the learned CIT(A). It was inter alia pointed out by the assessee that the deposits in one of the bank account in the immediately preceding year have been considered on peak credit basis and accordingly brought to tax. He also submitted that he agreed to addition of Rs. 43,72,650/- on agreed addition basis just to buy peace and to avoid litigation. The explanation of the assessee that he was in business on small scale and did not maintain books of account and that these deposits represented sale ....