TaxTMI 
TaxTMI 
2024 (10) TMI 173
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....t declaring total income at Rs. 7,21,32,800/- for the year under consideration. A search in the present case was carried out under section 132 of the Act on 06.01.2021 at the premises of Hans Group including assessee. Assessment was accordingly carried out as per provision of section 153A of the Act. The total income was assessed at Rs. 7,21,32,800/- without any adjustment. While framing the assessment, the Assessing Officer invoked penalty proceeding under Section 271AAB of the Act. The Assessing Officer consequently passed order under Section 271AAB of the Act treating an amount of Rs. 2,77,49,596/- included in the ROI 'as undisclosed income' susceptible to penalty under Section 271AAB of the Act. Consequently, the Assessing Officer impos....
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....porting documents is enclosed Further I had already paid taxes on the same at highest rate and the same is duly recorded in my original return." The AO accepted the above submission of the appellant and did not treat the amount shown by the appellant. No addition has been made by the AO u/s 68 or 69A r.w.s. 115BBE. The undisclosed income as per provisions of section 271AAB is defined as under: (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....
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....have not been admitted to be bogus transactions. The AO did not bring any other evidence on record to establish how the amount in question was covered in the definition of 'undisclosed income' in terms of section 271AAB. As the transactions pertain to F.Y. 2020-21 and appellant had declared them in ITR as income from share trading and same was accepted by the AO, it cannot be held to undisclosed income in terms of section 271AAB. Therefore, penalty u/s 271AAB(1A) held to be not sustainable and is deleted. 8. In the result, the appeal is allowed." 5. Aggrieved by the relief granted by the CIT(A), the Revenue is in appeal before the Tribunal. 6. As per the grounds of appeal, the Revenue has challenged the action of the CIT(A) dele....
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....orded under Section 132(4) of the Act. In this case, the assessee had neither made any surrender of so called undisclosed income during the search nor was the penalty initiated is based on undisclosed income discovered during the search. It was contended that for the purposes of sub Section (1A)(a) to Section 271AAB of the Act, two conditions for levy of penalty needs to be satisfied. Firstly; there should be existence of undisclosed income and secondly; such income must be offered in the statement recorded under Section 132(4) of the Act. None of these conditions are fulfilled in the instant case. The transactions of LTCG are backed by Contract Note and the transaction has been carried out through banking channel. Thus, such transactions f....
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....e assessee, neither the income disclosed in the return by way of LTCG fall under the definition of 'undisclosed income' contemplated under Section 271AAB of the Act nor any admission of so called undisclosed income has been made in the course of search in statement under Section 132(4) of the Act. The prerequisites of Section 271AAB (1A) of the Act are thus not satisfied. The action of the AO thus do not align with the penalty provisions codified under Section 271AAB of the Act. 12. Significantly, the LTCG in question was taxable in law in so far as the A.Y. 2021-22 is concerned and not exempt under Section 10 of the Act in any manner. The transactions are routed through Banking Channel and advance tax has also been paid prior to search. U....