2023 (2) TMI 1023

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.... referred to as the "Act") was carried out on 03.09.2014 at the business and residential premises of Jagdamba Group and the respondent is one of the members of the said group. During the course of search, no incriminating material was found in the case of the respondent. The Assessing Officer, subsequent to the said search, on 25/26.02.2015 had issued notice under Section 153A of the Act to the respondent to furnish return of income of the respondent. In response to the said notice, the respondent filed its return of income on 07.03.2016 showing loss at Rs. 2,40,73,444/-. In order to verify the genuineness of the aforesaid return of the respondent, the Assessing Officer on 10/11.08.2016 issued notice under Section 143(2) of the Act to the respondent. The Assessing Officer also issued a notice under Section 142(1) of the Act to the respondent on 15.11.2016 seeking information from the respondent in respect of the audited financial statements of the respondent up-loaded on the Income Tax website on 30.11.2014. The respondent, upon receipt of the said notice, filed a subsequent return of income manually before the Assessing Officer on 18.11.2016 showing now a loss of Rs. 92,68,340/- f....

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....the case, the learned I.T.A.T was right in upholding the order of the learned C.I.T (A) without considering the ground that the amount on which penalty under section 271(1) (c) was levied by the Assessing Officer represented the income in respect of which particulars had been concealed in the return rather than 'undisclosed income' found in course of search within the meaning of explanation (c) to section 271AAB? (ii). Whether in the facts and circumstances of the case, the impugned order passed by the learned I.T.A.T is perverse and deserves to be set aside by this Hon'ble Court? 5. Mr. R.N. Sahay, learned counsel for the revenue submits that the order passed by the CIT appeal as well as the impugned order passed by the Tribunal suffers from infirmity. It is true that section 271AAB of the Income Tax Act has been inserted w.e.f. 1.7.2012 for a specific purpose to cover all those cases where search has been initiated after the 1st day of July, 2012, but before 15th of December, 2016. It is also true that the search was initiated in premises of the respondent assessee on 3.09.2014 and as such the case of the assessee falls under the above provisions as the section has be....

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....n Laws (Second Amendment) Bill, 2016 receives the assent of the President, the assessee shall pay by way of penalty, in addition to tax, if any, payable by him,- (a) a sum computed at the rate of ten per cent of the undisclosed income of the specified previous year, if such assessee- (i) in the course of the search, in a statement under sub-section (4) of section 132,, admits the undisclosed income and specifies the manner in which such income has been derived; (ii) substantiates the manner in which the undisclosed income was derived; and (iii) on or before the specified date- (A) pays the tax, together with interest, if any, in respect of the undisclosed income; and (B) furnishes the return of income for the specified previous year declaring such undisclosed income therein; (b) a sum computed at the rate of twenty per cent, of the undisclosed income of the specified previous year, if such assessee- (i) in the course of the search, in a statement under sub-section (4) of section 132, does not admit the undisclosed income; and (ii) on or before the specified date- (A) declares such income in th....

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.... (i) which has ended before the date of search, but the date of furnishing the return of income under sub-section (1) of section 139 for such year has not expired before the date of search and the assessee has not furnished the return of income for the previous year before the date of search; or (ii) in which search was conducted; (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 transactions found in the course of a search under section 132, which has- (A) not been recorded on or before the date of search in the books of account or other documents maintained in the normal course relating to such previous year; or (B) otherwise not been disclosed to the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner before the date of search; or (ii) any income of the specified previous year represented, either wholly or partly, by any entry in respect of an expense recorded in the books of account or ....