TaxTMI 
TaxTMI 
2026 (5) TMI 449
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....sh, survey action was converted into search and seizure action u/s 132 of the Act on 19.10.2019. During the course of search action, cash of Rs. 34,50,000/- was found out of which an amount of Rs. 31 lakhs was seized. Although gold stock amounting to 35782.820 gms was found but nothing was seized. In the course of search action u/s 132 of the Act statement of Shri Ajitkumar Soni, director of the assessee company was recorded. In respect of cash found of Rs. 34,50,000/- the assessee in reply to question No.17 had admitted that he had no explanation for cash of Rs. 31,58,232/- out of the said cash found. In the post search proceedings vide letter filed on 13.12.2019 the assessee company offered Rs. 31,58,323/- as sales for April 2019 to September 2019 which was not recorded in the books of account. Similarly, in the course of search proceedings gold of 35782.820 gms were found. On verification of the books of account it was seen that as per books the gold was 34554.82 gms. Thus, there was excess gold found in the possession of the assessee. Shri Ajitkumar in his reply to question No.14 confirmed that there was excess gold of 1228 gms found in the possession of the assessee company an....
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....ssed by the Assessing Officer. He referred to the provisions of section 271AAB of the Act and held that the provisions of said section are squarely applicable as the conditions stipulated are clearly attracted. He noted that search action has been initiated u/s 132 of the Act and during the course of search the statement of the assessee was recorded under sub-section (4) of section 132 of the Act wherein the assessee had admitted the undisclosed income in the specified manner in which the said income has been derived. Relying on various decisions, he upheld the penalty levied by the Assessing Officer u/s 271AAB of the Act. 7. Aggrieved with such order of the Ld. CIT(A) the assessee is in appeal before the Tribunal. 8. The Ld. Counsel for the assessee strongly challenged the order of the Ld. CIT(A) in confirming the penalty levied by the Assessing Officer. He submitted that on the date of search the books were in-complete for few days for which all these problems happened. He submitted that the assessee was in regular business and the cash so found was explained to be out of sale proceeds and therefore the same cannot be considered as undisclosed income. Referring to the asses....
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....xcess stock of jewellery found during the course of search. So far as the unexplained cash of Rs. 31,58,323/- is concerned, he noted that although the assessee has offered an amount of Rs. 31 lakhs in the return of income filed and paid due taxes, however, the assessee failed to specify the manner in which the said undisclosed income was derived. Similarly, the assessee had not declared an amount of Rs. 58,323/- in the return of income filed. Further, the excess stock of jewellery valued at Rs. 42,73,440/- which was found during the course of search was not declared in the return of income filed. We find the Ld. CIT(A) sustained the penalty levied by the Assessing Officer on the ground that the provisions of section 271AAB of the Act are clearly applicable to the facts of the present case. Further, search had been initiated u/s 132 of the Act and during the course of search the statement of the director of the assessee company was recorded u/s 132(4) of the Act wherein he had admitted the undisclosed income in the specified manner in which such income has been derived. It is the submission of the Ld. Counsel for the assessee that levy of penalty u/s 271AAB of the Act is untenable s....
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....erely because the assessee has accepted the assessment order and has not challenged the same cannot be the basis for levy of penalty u/s 271AAB. Therefore, penalty u/s 271AAB cannot be levied due to addition on account of excess stock found during the course of search. In view of the above discussion, we are of the considered opinion that the penalty levied u/s 271AAB of the Act can be levied only on the amount of Rs. 58,323/- being the excess cash found which was not declared by the assessee in the return of income. We, therefore, modify the order of the Ld. CIT(A) and direct the Assessing Officer to restrict the penalty on the amount of Rs. 58,323/- not declared by the assessee. The grounds raised by the assessee are accordingly partly allowed. 15. In the result, the appeal filed by the assessee is partly allowed. Order pronounced in the open Court on 15th April, 2026. ============= Document 1 Q.13 Now your statement is being recorded U/s 132(4) of the Income Tax Act 1961, in the case of M/s Shivendra Jewellers Pvt. Ltd. at 440 Ravivar Peth, Near Sanya Maruti Chowk, Pune 411002. During the course of survey action U/s 133A of I.T. Act 1961, initiated on 18.10.2019 in th....
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....A OFFICE OF THE ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-2(1), PUNE Aaykar Sadan, 6th Floor, Room No.630, Bodhi Tower, 548/2B, Salisbury Park, Gultekdi, Pune-411037. Phone No. 020-24263630 Email Id:[email protected] -- No.PN/ACIT-CC-2(1)/Requisition data/SJ/2025-26/ Date: 12.03.2026 #12 To. M/s Shivendra Jewellers Pvt. Ltd Pune Sub: Furnishing of documents relied upon during Search/Survey in the case of M/s Shivendra Jewellers-reg. Ref: Your Letter dated 12.03.2026. Kindly refer to the above. 2. Vide above referred letter dated 12.03.2026 the Authorised representative of M/s Shivendra Jewellers has requested to share documents relied upon during the Search/ Survey carried out on 18.10.2019 in this case to verify the stocks of jewellery. 3. In this regard, please find attached the copy of Annexure-'5' wherein book stock working is carried out in the case of M/s Shivendra Jewellers. Yours faithfully, Enel: As above. (Jayanti S Kundhadiya) Deputy Commissioner of Income Tax, Central Circle-2(1), Pune Document 4 Annexuze - 5 PARTICULERS ..... AMviOUisi OPENING STOCK 82131910 LESS- BULLION 1.148 3626953.32 LESS-....