TaxTMI 
TaxTMI 
2022 (5) TMI 159
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....1492/PUN/2015, A.Y. 2006-07 : 4. The appellant raised the following grounds of appeal :- "[A] Grounds of Appeal Before the Honourable ITAT Pune. 1) In the facts and circumstances of the case and in law, the learned Assessing Officer erred in passing the assessment order without having jurisdiction because, no opportunity of being heard was granted to the Appellant u/s 127 and also disregarding the objections raised u/s 292BB in this regard. Without prejudice to the above and alternatively under protest: 2) On facts and circumstance of the case and in law, the learned Assessing Officer erred in making routine additions / disallowances in assessment u/s 153A in the absence of any incriminating material and without appreciating the fact that original assessment made u/s 143(1)(a) which is completed on the date of initiation of search get abated. 3) In the facts and circumstances of the case and in law. the learned Assessing Officer erred in adding Rs. 10,00,000/- under the head Income from Other Sources in respect of page no. 98 of Annexure A1 impounded from the office of M/S Mahavir Civil Engineering Pvt. Ltd. during the course of their....
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....led on 31.10.2006 disclosing income of Rs.9,57,815/-. Subsequently, the search and seizure operations were conducted in the residential premises of the appellant on 09.08.2011 by the DDIT (Inv.), Jalgaon. The jurisdiction of the appellant's case had been transferred from Jalgaon to Nashik by the Commissioner of Income Tax-II, Nashik vide order dated 02.12.2011 u/s 127 of the Act. During the course of search and seizure operations, certain incriminating material was stated to have been impounded. Subsequently, notice u/s 153A of the Income Tax Act, 1961 ('the Act') was issued to the appellant on 18.05.2012 calling upon the appellant to file the return of income. The appellant filed a letter stating that the return of income filed u/s 139 be treated as return of income in response to notice u/s 153A of the Act. Thereafter, the assessment was taken up for scrutiny assessment. During the course of assessment proceedings, the assessee had objected the transfer of jurisdiction of the Assessing Officer by stating that while passing the order u/s 127, no opportunity was given to the assessee. The Assessing Officer had rejected the above objection placing reliance on the provisions of secti....
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..... 8. It is trite law that an assessee is barred from raising contention that no opportunity was given to the assessee while transferring the jurisdiction of the case u/s 127 from Jalgaon to Nashik as the order of the transfer of case u/s 127 was within the knowledge of the assessee during the course of assessment proceedings and still the assessee had not chosen to participate in the matter of jurisdiction of the Assessing Officer to whom the case has been transferred. The assessee cannot be allowed latter to challenge the jurisdiction of the Assessing Officer as held by the Hon'ble Supreme Court in the case of Pannalal Binjraj vs. Union of India, 31 ITR 565 (SC) and the Hon'ble Gujarat High Court in the case of Shivabhai Khodabhai Patel vs. CIT, 244 ITR 457 (Guj.-HC). The Hon'ble Patna High Court in the case of Steel Engg. & Processing Works vs. Union of India, 243 ITR 721 (Pat.-HC) after referring to the judgement of the Hon'ble Supreme Court in the case of Pannalal Binjraj (supra) held to the same effect by holding as under :- "19. But this is not all. The facts as are emerging from the records of this case cannot be lost sight of, which have been elaborately pleaded....
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....ng & Services Pvt. Ltd. It is contended that the impounded document from the premises of the third party cannot be used as incriminating material for the purpose of making addition in the assessment made pursuant to notice u/s 153A of the Act. In the absence of any evidence suggesting the payment of money to the appellant, no addition can be made. 11. On the other hand, ld. CIT-DR relying on the orders of the lower authorities submitted that the impounded papers was found in the business premises of the appellant and it cannot be said that the impounded document was found in the third party's premises. As regards to the evidentiary value of the impounded document, he submitted that the document was found in the possession of the appellant and, therefore, the lower authorities are justified in making the addition based on the impounded documents. 12. We heard the rival submissions and perused the material on record. The present issue relates to whether or not in the facts and circumstances of the case, the addition of Rs.10,00,000/- made by the Assessing Officer based on the impounded documents is sustainable? No doubt the impounded document no.98 of Annexure A-1 was impounded....
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....eedings, the statement was recorded u/s 132(4), wherein, the appellant had offered a sum of Rs.1 crore as additional income and the assessment was completed by the Assistant Commissioner of Income Tax, Central Circle-1, Nashik ('the Assessing Officer') vide order dated 29.03.2014 passed u/s 143(3) r.w.s. 153B at a total income of Rs.1,46,94,826/-. Subsequently, the Assessing Officer issued a penalty notice for levy of penalty u/s 271(1)(c) r.w.s. 271AAA of the Act, wherein, the assessee submitted that no penalty should be levied for the reason that disclosure of amount of Rs.1 crore was made only with the intention to buy mental peace and the appellant had made voluntarily disclosure u/s 132(4) and the tax due on the returned income had been paid. The appellant also relied on the decision of the Hon'ble Allahabad High Court in the case of CIT vs. Radha Kishan Goel, 278 ITR 454 (All.). However, the Assessing Officer considering the explanation of the appellant noted that the appellant had failed to satisfy and substantiate the manner in which the undisclosed income has been derived, had proceeded wtih levy penalty of Rs.10,00,000/- vide order dated 19.09.2014. 17. Being aggrieved....
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....ation Officer as to the manner in which the undisclosed income offered by the assessee. Reference can be made on the decision of the Hon'ble Gujarat High Court in the case of CIT vs. Mahendra C. Shah, 299 ITR 305 (Guj.) and the decision of the Hon'ble Allahabad High Court in the case of CIT v. Radha Kishan Goel, 278 ITR 454 (All.). 22. In such circumstances, the Hon'ble Gujarat High Court and the Hon'ble Allahabad High Court took a view that conditions stipulated u/s 271AAA stands satisfied and question of levy of penalty u/s 271AAA does not arise. When there is no specific query was raised to the assessee during the course of statement recorded u/s 132(4), as to the manner in which the undisclosed income was derived, the Assessing Officer is not justified in imposing the penalty u/s 271AAA of the Act. However, the Hon'ble Delhi High Court in the case of Smt. Ritu Singal (supra) considering the above two decisions of the Hon'ble Gujarat High Court in the case of CIT vs. Mahendra C. Shah, 299 ITR 305 (Guj.) and the decision of the Hon'ble Allahabad High Court in the case of CIT v. Radha Kishan Goel, 278 ITR 454 (All.) and the decision of the Hon'ble Supreme Court in the case of (....
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....able evidence. When the initial onus placed by the explanation, has been discharged by him, the onus shifts on the Revenue to show that the amount in question constituted the income and not otherwise. 8. Assessee has only stated that he had surrendered the additional sum of Rs.40,74,000/- with a view to avoid litigation, buy peace and to channelize the energy and resources towards productive work and to make amicable settlement with the income tax department. Statute does not recognize those types of defences under the explanation 1 to 271 (1) (c) of the Act. It is trite law that the voluntary disclosure does not release the Appellant-assessee from the mischief of penal proceedings. The law does not provide that when an assessee makes a voluntary disclosure of his concealed income, he had to be absolved from penalty. 9. We are of the view that the surrender of income in this case is not voluntary in the sense that the offer of surrender was made in view of detection made by the AO in the search conducted in the sister concern of the assessee. In that situation, it cannot be said that the surrender of income was voluntary. AO during the course of assessment proceed....
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....f the assessee and the Calcutta High Court has also taken a view in its favour we should adopt a view beneficial to the assessee following the decisions of the Supreme Court in CIT v. Vegetable Products Ltd. [1973] 88 ITR 192 and CIT v. Naga Hills Tea Co. Ltd. [1973] 89 ITR 236 . We have considered the submission. We have also carefully considered the decisions of the Supreme Court. We, however, find it difficult to accept this submission, as in our opinion, the observations of the Supreme Court in those decisions have been stretched too far. The Supreme Court in CIT v. Vegetable Products Ltd, [1973] 88 ITR 192 (at page 195), merely observed : "If we find that language to be ambiguous or capable of more meanings than one, then we have to adopt that interpretation which favours the assessee, more particularly so because the provision relates to imposition of penalty." Similarly, in CIT v. Naga Hills Tea Co. Ltd. [1973] 89 ITR 236 , at page 240, the Supreme Court had observed as follows : "If a provision of a taxing statute can be reasonably interpreted in two ways, that interpretation which is favourable to the assessee, has got to be accepted. This is a w....