2015 (9) TMI 1634

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....e as under. 4. The assessee was in possession of Rs. 28 lakhs, returning from Indore to Ahmedabad by a bus when he was checked and interrogated by Police, Chandan Nagar, Indore. He was arrested for alleged offence on 12.12.2008. The sum of Rs. 28 lakhs was seized by Police Department. This amount was handed over by police to the Income Tax Department, Indore. A notice u/s 142(1) was issued to the assessee in the light of proceedings u/s 102 of the IPC initiated by police department because of seizure of cash of Rs. 28 lakhs from the assessee on 15.12.2008 at Indore. Summons were issued to the assessee u/s 131 and his statement was recorded. Since the assessee could not explain the cash and took contrary stand before AO, the AO passed an ....

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....as working as an employee for a meager salary of Rs. 4000/- per month and hence cannot have earned such huge sum. Therefore, levy of penalty in this case, on the addition of cash found, under deeming provision of Sec. 69A of the LT. Act could not be sustained. For this purpose reliance is placed on the case laws referred by appellant which are narrated above namely (a) Gujrat High Court's decision in the case of CIT vs. Baroda Tin Works, 221 ITR 661 (b) Karnataka High Court's decision in the case of CIT vs. M.M. Gujamgadi, 290 ITR 168 (c) Delhi High Court's decision in the case of CIT vs. Vinod Kumar and (d) ITAT, Indore in the case of Dhannyakumar Jain, 5 ITR (Trib.) 497. The penalty u/s 271(1)(c) levied at Rs. 17,35,000/- stands deleted. ....

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.... Explanation 5 is applicable to a situation where, in the course of a search under section J 32, the assessee is found to be the owner of any money, bullion, jewellery or other valuable article or thing and the assessee claims that such assets had been acquired by him by utilizing, wholly or in part, his income for any previous year which had already ended before the date of the search or which is to end on or after the date of the search. Manifestly, the additions to which the provisions of Explanation 5 had been applied by the Commissioner (Appeals), did not represent money, bullion, jewellery or other valuable article or thing, of which the assessee was found to be the owner in the course of search. Therefore, the Commi....