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2019 (7) TMI 383
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....er appeal was liable to be cancelled. 3. That the Ld. CIT(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 5....
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....That the Ld. CIT(Appeals)-4, Kanpur has erred in law and on facts in not appreciating that the penalty could not have been levied for twin charges (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....
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....ven case when the principles of natural justice are stated to have been violated it is open to the appellate authority in appropriate cases to set aside the order and require the Assessing 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 canno....
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....ir Metal Work Vs. CIT (PAH) 92 ITR 513 5.9 In the latest judgement of Supreme Court in the case of Balrampur Chini Mills Ltd. Vs CIT (2017)(SC) 246 taxmann 373 (SC) it was held by the Apex court that additional income detected by the department and declared by the appellant, consequent to search action would 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 deter....
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....roceeding assessee were required to explain the document as page no. 68, 76, 78, 80, 87, 96, 116, 117 and 118 of LP- 2(A-2) SEIZED FROM PREMISE OF 195-Ram Vihar Delhi. Which is related to cash payment to cash received. The assessee has submitted that 'the following amount was received in cash from resident of society towards maintenance and summary of the cash movement and cash payment made by Sh. Sanjeev Jain between 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 ad....
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.... filing of material which is not in conformity with the facts or truths. They deal in with correct detail about income so that a part of the income could be covered up by the assessee. None of these two conditions are applicable to the instant case. The AO proceeded to treat the assessee's additional income so offered as concealment and furnishing of inaccurate particulars of income. The provisions of the explanation 5A to Section 271(1)(c) 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 lev....
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....of depreciation penalty is not leviable. The additions in assessment proceedings will not automatically lead to inference of levying penalty. The Calcutta High Court in the case of Commissioner of Income Tax v. Suresh Chand Bansal, (2010) 329 ITR 330 (Cal) held that where there was an offer of additional income in the revised return filed by the assessee and such offer is in consequence of a search action, then if the assessment order accepts the offer 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....
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....re "be deemed to have concealed the particulars of his income", which shows that there is a deeming fiction by virtue of which such additional income is considered as concealment. If such additions in the income in the return filed consequent to a search, were to automatically evidence concealment under Section 271(1)(c), there would be no need for Parliament to enact a deeming fiction in the form of Explanation-5; such a reading would render Explanation-5 otiose and without 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 previou....