TaxTMI 
TaxTMI 
TaxTMI 
2019 (7) TMI 383
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....IT(Appeals)-4, Kanpur has erred in law and on facts in not considering that specific charge/default for which penalty was initiated was never crystallized and clearly stated neither the assessment order nor in any of the notice(s) therefore, the penalty imposed was also not valid in law and on facts and was liable to be cancelled. 4. That the Ld. CIT(Appeals)-4, Kanpur has erred in law and on facts in not considering that that A.O. did not specifically invoke Explanation 5A to Section 271 (1 )(c) of the Income Tax Act, 1961, neither in the Assessment Order nor in any of the notice(s) issued therefore, the imposition of penalty by the unilateral presuming that explanation 5 A to Sec. 271 (1 )(c) of the Income Tax Act, 1961 is applicable, was not sustainable in law and on facts. 5. That the Ld. CIT(Appeals)-4, Kanpur has erred in law and on facts in not considering and appreciating the conditions necessary for invocation of Explanation 5A to Section 271(1 )(c) of the Income Tax Act, 1961 were neither present in the facts of the present case nor the onus cast upon the A.O. for invocation of Explanation 5A to Section 271 (1 )(c) of the Income Tax Act, 1961 was discharged by him, th....
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....for concealment of particulars of income and filing of inaccurate particulars) because both the charges given in the jurisdictional notice issued under section 271AAB of the Income Tax Act, 1961 are mutually exclusive situation and cannot co-exist therefore, the penalty imposed based on such understanding of law is liable to be cancelled. 8. That the Ld. CIT(Appeals)-4, Kanpur has erred in law and on facts in not appreciating that it is essential on the part of the AO to inform the assessee that the penalty proceedings are being initiated against him under Section 271AAB of the Income Tax Act, 1961, hence, in the absence of the same the penalty imposed is insupportable in law and on facts." 2. Since, the issue being dealt in both the appellants is similar except the quantum involved, they are being adjudicated together for the sake of convenience. 3. In the case of Rishabh Buildwell Pvt. Ltd., the quantum of the penalty for the assessment year 2011-12 was of Rs. 6180000/- and for the assessment year 2013-14 was Rs. 148200/-. In these cases, the assessment was completed u/s. 153A on 30.12.2016 and simultaneously, penalty proceedings u/s. 271(1)(c) were initiated by the AO and th....
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....essing Officer to decide the case In the present facts of the case no prejudice is caused to the appellant by the clerical mistakes committed by the Assessing Officer in the penalty notice u/s. 271(1)(c) of the Act. Therefore, the legal ground of appeal of the appellant is hereby dismissed. iii) The contention of the appellant is that there is no variation in the income filed by the appellant u/s. 153A of the Act and the assessment of income u/s. 153A of the Act, hence, there is no concealment of income. 5.5 The undersigned has carefully considered the contention of the appellant and the factual matrix of the case, it is undisputed fact that the appellant has not disclosed the income in the original return of income filed u/s. 139(1) of the Act. The disclosure of additional income is on account of conduct of search u/s. 132(1) of the Act and issue of notice u/s. 153A of the Act. Disclosure of additional income u/s. 153A of the Act consequent to the search action cannot be treated as voluntary on the part of the appellant. Had there been no search, appellant would not have disclosed the additional income because there would not be any occasion to issue notice u/s. 153A of th....
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....uld attract penalty provisions u/S. 271(1)(c) of the Act. 5.10 Therefore, in view of the detailed discussion and case laws cited here-in-above, undersigned finds no reason to interfere with the levy of penalty by the Assessing Officer. The same is therefore, confirmed and grounds of appeal of the appellant is dismissed." 5. Before us during the argument, the ld. AR argued that the AO did not specifically invoke Explanation 5A to section 271(1)(c) of the Act either in the assessment order or in any of the notices issued prior to passing of the penalty order. He argued that no specific charge / default for which the penalty was initiated, was never clearly stated in either the notice or in the assessment order. His main argument revolved around two points, (a) since the returned income filed in response to notice u/s. 153A of the Act and the assessed income determined in such proceedings is exactly the same, hence, no penalty u/s. 271(1)(c) is attracted. (b) the absence of specific charge in the penalty notice for which he relied on the judgments of the Hon'ble Supreme Court in the case of SSA Emrald Meadows, 73 Taxman 248 (SC). 6. Against these arguments, the ld. DR extensively ....
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....tween different companies are on behalf of the companies by Sh. Sanjeev Jain, to summaries it is submitted that the net result of the above documents off Rs. 1,05,83,000/- already declared in the return of income in A.Y. 2014-15'. The reply of the assessee is considered and Rs. 1,05,83,000/- will be added in the hands of Sh. Sanjeev Jain in A.Y. 2014-15. Penalty proceeding u/s 271AAB of the I.T. Act also initiated separately. Addition: Rs. 1,05,83,000/- (A.Y.2014-15) 4.2 During the assessment proceeding assessee were required to explain the document as page no. 33-51 of LP-3(A-3) seized from premise of 195- Ram Vihar Delhi. The assessee is required to explain the above documents and a show cause given to assessee that why may not be treated as unexplained and added in your income? The assessee has submitted that 'These documents are related to Angel Mall and not recorded in the books of accounts; as per memory of the Sanjeev Jain, it is cash received and cash paid on the behalf of companies, but due to avoid litigation, we have surrendered Rs. 80,00,000/- in A.Y. 2009-10, Rs. 72,95,000/- in A.Y. 2010-11 and Rs. 4,03,05,000/- in A.Y. 2011-12'. The reply of the assessee is consi....
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.... of the Act and 271AAB of the Act have to be interpreted strictly. Unless, there is an actual concealment or non-discloser of the particular of the income the penalty cannot be imposed. Further, when the revised income is accepted and the income is assessed as per the revised income there is no scope of penalty. In the case of Kirit Dahyabhai Patel Vs ACIT (2017) 80 Taxmann.com 162 (Guj.), the Hon'ble High Court held that in view of specific provision of Section 153A, the return of income filed in response to notice u/s 153A is to be considered as return filed u/s 139, as the AO has made assessment on the said return and, therefore, the return has to be considered for the purpose of penalty u/s 271(1)(c) of the Act and the penalty is to be levied on the income assessed over and above the income returned u/s 153A, if any, admittedly, in this matter both the returned income and the assessed income are same. Whereas the Revenue was of the opinion that in as much that the income disclosed by the assessee under Section 153A was higher than the income in the original return filed under Section 139(1) and since in his view, such disclosure of income was a consequence of the search conduc....
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....ffer of the assessee, levy of penalty on such offer is not justified without detailed discussion of the documents and their explanation which compelled the offer of additional income. The Madras High Court in the case of S.M.J. Housing v. Commissioner of Income Tax, (2013) 357 ITR 698 held that where after a search was conducted, the assessee filed the return of his income and the Department had accepted such return, then levy of penalty under Section 271(1)(c) was not justified. From the above cases it would be clear that when an assessee has filed revised returns after search has been conducted, and such revised return has been accepted by the A.O., then merely by virtue of the fact that such return showed a higher income, penalty under Section 271(1)(c) cannot be automatically imposed. 14. Considering that the non-obstante clause under Section 153A excludes the application of, inter alia, Section 139, it is clear that the revised return filed under Section 153A takes the place of the original return under Section 139, for the purposes of all other provisions of the Act. This is further buttressed by Section 153A (1)(a) which reads: "Notwithstanding anything contained in secti....
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....thout any purpose. This is also consonant with the view arrived at in the earlier part of this decision, i.e. mere increase of income in the return filed pursuant to Section 153A would not be sufficient to show concealment under Section 271(1)(c). 17. For the Revenue to invoke Explanation-5, it would have to prove that its requirements are clearly fulfilled in the present case. In order for Explanation-5 to apply, it is necessary that there must be certain assets (such as money, bullion etc.) found in the possession of the assessee during the search, and that the assessee must claim that such assets have been acquired by him by utilizing his income. Moreover, such income must be in relation to a particular previous year that has either ended before the date of the search or is to end on or after the date of the search and such income is declared subsequently in the return of income filed after the search. Therefore, it is only when assets are found during the search which the assessee claims have been acquired by him by utilizing his income for any particular previous year, and then declares such income in a subsequent return filed after the date of search, would it be deemed that....