TaxTMI 
TaxTMI 
2020 (9) TMI 864
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.... in law the ld. CIT(A) was right in deleting the penalty of Rs. 62,70,000/- imposed by the AO u/s 271AAB(1)(c) of the I.T. Act, 1961 ignoring the fact that had the search not been conducted, the assessee would not have shown this income of Rs. 3.30 crore. 2. Whether on the facts and I the circumstances of the case and in law the ld. CIT(A) was right in deleting the penalty on undisclosed income of Rs. 3.30 crores on account of advances. 3. Whether on the facts and I the circumstances of the case and in law the ld. CIT(A) is justified in holding that the income was found recorded is other documents maintained by the assessee in normal course as per clause (c) of sub section (1) to explanation of Section 271AAB of the I.T. A....
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....vance given as his undisclosed income u/s 132(4) of the Act and paid taxed there in the returned filed on 31-01-2015. The AO imposed penalty on Rs. 3.3 Crores and also the on the sum of Rs. 92,770/- confirmed by CIT(A) on certain other disallowances. 5.3 I have carefully perused the order relied upon. The relevant para 21 reads as under:- 21. During the course of search, a note book (diary) has been found wherein there are notings relating to advance given to various persons towards purchase of land. The notings describe the name of the persons, the amount advanced which ranges from Rs. 2 Lacs to Rs. 24 lacs to 10 persons and the date of such advance during the period November, 2013 to February, 2014. Therefore, what has b....
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....ocuments, and which has not been recorded before the date of search in the books of accounts or other documents maintained by the assessee in the normal course. We are also conscious of the fact that there are deeming provisions in terms of section 69 and 69B wherein such investments are deemed to be treated as income in absence of satisfactory explanation. In our view, the deeming fiction so envisaged under Section 69 and Section 69B where investments which are found either not recorded or found recorded at a lesser value in the books of accounts, and such investments are deemed to be income of the assessee of the year in which such investments have been made, cannot be extended and applied automatically in context of section 271AAB. It is....
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....disclosed income by the appellant. 5.4 Further during the course of appellate proceedings the Ld. A/R was specifically asked about applicability of the decision in the case of Sandeep Chandak Vs. CIT 93 Taxmann.com 405, in which case the SLP filed by the appellant in that case was dismissed by Hon'ble Supreme Court. The Ld. A/R submitted as under: 1. That the case Shri Sandeep Chandak in ITA No. 122 of 2017 decided by Hon'ble Allahabad High Court is totally different from the facts of the facts of the assessee's case. In the case of Shri Sandeep Chandak the issue of initiation of penalty and satisfaction of the AO was primary issue which has been challenged by the assessee. The Hon'ble ITAT Lucknow Bench ha....
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....le High Court of Allahabad. Even otherwise this aspect is discussed elaborately in the order of Niraj Mathur delivered by Hon'ble ITAT Jaipur. Thus, following the decision of the Hon'ble ITAT Jaipur Bench discussed supra, the penalty levied by the AO is unjustified. The various other cases of ITAT Jaipur bench referred by the Ld. AR also support his case. 6.3 Accordingly the penalty on 3.3 Crores is directed to be deleted. To make matter clear, the penalty is confirmed on the addition of Rs. 92,770/-. The AO thus will recompute the penalty u/s 271AAB on a sum of Rs. 92,770/- at the same rate adopted in the initial penalty order.'' 2.2 During the course of hearing, the ld. DR supported the order....