AI Drafter 
TaxTMI 
TaxTMI 
2019 (1) TMI 1875
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....ncome Tax Act, 1961 by the Assistant Commissioner of Income Tax (Central)-I, Indore. 2. The appellate order being not based on facts, and in law, is illegal and wrong. 3. The appellant company craves leave to add/alter/amend the above Grounds of Appeal, if and when, necessity or occasion arises. 2. Briefly stated facts are that a search & seizure operation was carried out in the business as well as residential premises of the appellant group, Indore including the assessee along with other concerns/business associates on 21.9.2012. Subsequently, a notice u/s 153A of the Income Tax Act, 1961 (hereinafter called as 'the Act') was issued. In response thereto, the assessee filed return of income. The A.O. framed assessment u/s 153A r.w.s. 143(3) of the Act vide order dated 24.3.2015. While framing the assessment, the A.O. also initiated penalty proceedings u/s 271(1)(c) of the Act in the case of the assessee for the assessment years 2010-11 & 2011-12 and penalty u/s 271AAB of the Act for the assessment year 2012-13. Subsequently, the A.O. imposed a penalty u/s 271(1)(c) of the Act in respect of appeal under consideration vide order dated 23.9.2015 thereby the assess....
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....15 are held to be bad in law and contrary to the judgement of the Hon'ble M.P. High Court in the case of PCIT-I Vs. Kulwant Singh Bhatia (supra). Accordingly, the impugned penalty order is hereby quashed, being bad in law. 9. In the result, the appeal filed by the assessee in ITA No.78/Ind/2017 is allowed. ITA No.79/Ind/2017: 10. Now we take up ITA No.79/Ind/2017. In this appeal of the assessee, the facts and grounds are identical to ITA No.78/Ind/2017 wherein we have held as under:- 7. The Hon'ble jurisdictional High Court in the case of PCIT-I Vs. Kulwant Singh Bhatia (supra) in paras 9 to 11 has held as under: 8. The revenue has not brought any contrary material suggesting that a valid notice was served on the assessee for initiating proceedings u/s 271(1)(c) of the Act. This Tribunal is bound by the judgement of the Hon'ble jurisdictional High Court. Respectfully following the same penalty proceedings initiated by the A.O. vide notice dated 24.3.2015 are held to be bad in law and contrary to the judgement of the Hon'ble M.P. High Court in the case of PCIT-I Vs. Kulwant Singh Bhatia (supra). Accordingly, the impugned penalty order is he....
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....re the Ld. CIT(A). 14. Per contra, Ld. D.R. opposed the submissions and supported orders of the authorities below. He submitted that nowhere under the Act it is prescribed that the penalty u/s 271AAB of the Act can be imposed only for the additions made on the basis of incriminating material. He further submitted that the judgement of the Hon'ble Apex court rendered in the case of Mak Data Pvt. Ltd. Vs. CIT in Civil appeal No.9772/2013 has rightly been applied. 15. We have heard the rival submissions, perused the materials available on record and gone through the orders of the authorities below. There is no dispute with regard to the fact that during the course of search, it was noticed by the revenue authorities that the assessee had made transaction for purchase of material in cash, which was not recorded in the books of accounts. It was only when confronted, the same was offered for taxation as income from undisclosed sources. As per section 271AAB of the Act, the A.O. can direct the assessee to pay a sum computed @ 10% in the undisclosed income of the specified previous year, if such assessee in the course of the search in a statement under sub section 4 of section 13....
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....ts/entries were found during the course of the search. 3.3. It is seen that the appellant in its submissions before the Assessing Officer and the undersigned is placing undue importance on the voluntary disclosure made to buy the peace of mind. The Hon'ble Supreme Court in the case of Mak Data (P) Ltd., (2013) 38 Taxmann.com 448 has held that the AO shall not be carried away by the plea of the assessee like "voluntary disclosure", "buy peace", "avoid litigation", "amicable settlement", etc. to explain away its conduct. 3.4 The Financial Year under consideration was the specified previous year, hence provisions of section 271AAB would apply. It would be useful to reproduce the meaning of "undisclosed income" for levying the penalty u/s 271AAB of the Act. Same is provided as Explanation (c) to this Section 271AAB of the Act, and reproduced as under: "Explanation For the purposes of this section,-- (c) "undisclosed income" means (i) any income of the specified previous year represented, either wholly or partly by any money, bullion, jewellery or other valuable article or thing or any entry in the books of account or other documents or t....
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....r made by the appellant before the Investigation Wing only the details of the disclosure have been given and the manner of earning the undisclosed income has not been stated. As the manner of earning the undisclosed income has not been explained I hold that penalty is to be leived @ 30% of the undisclosed income u/s 271AAB(1)(c). 3.7 In view of the facts and circumstances of the case it is held that penalty is leviable u/s 271AAB (1)(c) @ 30% of the undisclosed income Grouind Nos.1 and 2 are dismissed." 16. It is recorded by the A.O. that during the course of search evidences related to payment in cash for material purchase was found and on examination of books of accounts, it was found that these amounts were not accounted for by the assessee. It is also stated by the assessing officer that through this letter Shri Deepak Kalra stated that these payments were made out of income from undisclosed sources and admitted these amounts as additional income from undisclosed sources. This fact is not rebutted by the assessee by placing any contrary material on record. Since there is no ambiguity under the law and the assessee has not placed any material which could suggest that....
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.... and grounds are identical to ITA No.85/Ind/2017 adjudicated above and the parties have adopted the same argument and based on the findings given, the A.O. is directed to delete the penalty and hence, these appeals of the assessee are also allowed. ITA Nos.88 & 89/Ind/2017: 24. Now we take up ITA Nos.88 & 89/Ind/2017. In these appeals of the assessee, the facts and grounds are identical to ITA No.80/Ind/2017 adjudicated above and the parties have adopted the same argument. Based on the findings given above, the grounds raised in these appeals are dismissed. ITA Nos.90 to 94/Ind/2017: 25. Now we take up ITA Nos.90 to 94/Ind/2017. In these appeals of the assessee, the facts and grounds are identical to ITA No.78/Ind/2017 adjudicated above and the parties have adopted the same argument. Based on the findings given above, the A.O. is directed to delete the penalty and hence, these appeals of the assessee are also allowed. ITA Nos.95 to 97/Ind/2017: 26. Now we take up ITA Nos.95 to 97/Ind/2017. In these appeals of the assessee, the facts and grounds are identical to ITA No.78/Ind/2017 adjudicated above and the parties have adopted the same argument. Based on the findin....
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....ated under section 132 on or after the 1st day of June, 2007, the assessee is found to be the owner of, - (i) Any money, bullion, jewellery or other valuable article or thing (hereinafter in this Explanation referred to as assets) and the assessee claims that such assets have been acquired by him by utilizing (wholly or in part) his income for any previous year; or (ii) Any income based on any entry in any books of account or other documents or transactions and he claims that such entry in the books of account or other documents or transactions represents his income (wholly or in part) for any previous year, which has ended before the date of the search and,- (a) where the return of income such previous year has been furnished before the said date but such income has not been declared therein; or (b) the due date for filing the return of income for such previous year has expired but the assessee has not filed the return, then, notwithstanding that such income is declared by him in any return of income furnished on or after the date of the search, he shall, for the purposes of imposition of a penalty under clause (c) of sub-secti....
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....ot included in the return filed u/s 139 and has been offered in the return filed u/s 153A and this amount is included in the assessment made u/s 153A r.w.s 143(3). Therefore, the contention of the appellant that penalty has been levied by the Assessing Officer without mentioning whether it is initiated for concealing the particulars of income or for furnishing inaccurate particulars of income and therefore not leviable is devoid of merit. Document 4 OFFICE OF THE DEPUTY COMMISSIONER OF INDORE TAX (CENTRAL)-I, INDORE Aayakar Bhawan Main Building, Room No.122, Opp. White Church, A.B. Road, Indore PAN: AAHCS5800L Date: 24/03/2015 To, M/s SM And SM Resorts -N- Hotels International Ltd. NRK Business Park, B1, PU-4, 3rd Floor, Scheme No. 54, Behind Mangal City, Indore-452001 Sir/Madam, NOTICE UNDER SECTION 274 READ WITH SECTION 271(1)(c) OF THE INCOME TAX ACT, 1961 Whereas in the course of proceedings before me for the A.Y. 2011-12 it appears to me that you:- * have without reasonable cause failed to furnish the return of income which you were required to furnish by a notice given under section 22(1)/22(2)/34 of the I....
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.... for the assessment years 2002-03 to 2007-08 is Rs.24,39,753 and the learned ITAT has decided all these appeals by composite order dated 11.8.2017. It is covered in para 5 of the Circular No.21 of 2015 dated 10.12.2015 and, therefore, the present appeals have been filed. 11. On due consideration of the arguments of the learned counsel for the appellant, so also considering the fact that the ground mentioned in show-cause notice would not satisfy the requirement of law, as notice was not specific, we are of the view that the learned Tribunal has rightly relying on the decision of CIT V/s. Manjunatha Cotton Ginning Factory (supra) and CIT V/s. SSA'S Emerald Meadows (supra) rightly allowed the appeal of the assessee and set aside the order of penalty imposed by the authorities. No substantial question of law is arising in these appeals. ITA.No(s).9/2018, 10/2018, 11/2018, 12/2018, 13/2018 and 14/2018, filed by the appellant have no merit and are hereby dismissed. Document 7 9. Considering the aforesaid, the Tribunal has held that the penalty levied under Section 271(1)(c) of the Act of 1961 is not sustainable in law, as no ....