2023 (5) TMI 1451

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....evance of the assessee is that the ld. CIT(Appeals) has erred in confirming the penalty of Rs.10,01,500/- imposed by the ld. Assessing Officer under section 271AAB of the Income Tax Act. 3. Brief facts of the case are that a notice under section 153C of the Income Tax Act was issued to the assessee on 07.09.2015 calling for return of income for A.Y. 2008-09 to 2013-14. The assessee has filed the return of income for A.Y. 2013-14 on 15.09.2015 declaring total income at Rs.1,53,30,300/-. The ld. Assessing Officer had issued a notice under section 143(2) for scrutinising this return. He passed an assessment order under section 143(3) read with section 153C of the Income Tax Act on 31.03.2016. The ld. Assessing Officer has accepted the retur....

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.... that, in a case where search has been initiated under section 132 on or after the 1s t day of July, 2012, 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 percent of the undisclosed income of the specified previous year, if such assessee- (i) in the course of the search, in a statement under subsection (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 ....

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....ent of disclosure. Statement under section 132(4) is to be recorded during the course of search to find out, whether any declaration is to be made by an assessee or not. The next fatuous attempt at the end of ld. Assessing Officer is that taxable income determined by him in the assessment order is of Rs.1,25,82,290/-, which is almost equivalent to the returned income disclosed by the assessee. The penalty is to be computed by taking cognizance of the assessed income. Here the ld. Assessing Officer has imposed a penalty of Rs.1.98 crores without making any reference to the income determined in the hands of assessee, rather taking cognizance of the statement of searched person, who might have disclosed Rs.6.6 crores. It is totally against the....