TaxTMI 
TaxTMI 
2026 (8) TMI 1852
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....ppellate discussion. 3. That being the case, Mr. Agarwal refers to the assessee's paperbook at pages 4 to 6 compiling the Assessing Officer's impugned penalty notices issued on 18.07.2024, 02.09.2024 & 04.11.2024 on as many occasions nowhere specifying the corresponding limb(s) u/s 271AAB of the Act. He next quotes DCIT Vs Sanjay Singh in ITA No. 6942/Del/2019 decided on 28.11.2019 that such a failure is very much fatal to the impugned penalty; as follows: 7. The assessee has surrendered the income of Rs. 9.00 Crores during the course of search proceedings as evident from the above. The AO levied penalty @ 30% on such income under section 271AAB(1)(a) of the Act on the reasoning that the assessee did not fulfill the terms and conditions laid down under section 271AAB(1)(a) of the Act and the assessee has also not divulged the source and manner of earning such income. On the other hand, the Ld. CIT(A) has held otherwise and has given a categorical finding that the assessee has fulfilled the terms and conditions laid down under section 271AAB(1)(a) of the Act and thus, the penalty was leviable @ 10% instead of 30%. Aggrieved, the Revenue filed appeal challenging t....
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....sclosure of additional income in the statement recorded under section 132(4) Itself is not sufficient to levy the penalty under section 271AAB of the Act until and unless the income so disclosed by the assessee falls in the definition of undisclosed income defined in the explanation to section 27.1AAB(1) of the Act. Therefore, the question whether the income disclosed by the assessee is undisclosed income In terms of the definition under section 271AAB of the Act has to be considered and decided in the penalty Since the assessee has offered the said income in the return of income filed under section 139(1) of the Act, therefore, the question of taking any decision by the AO in the assessment proceedings about the true nature of surrender made by the assessee does not arise and only when the AO has proposed to levy the penalty then it is a pre-condition for invoking the provisions of section 271AAB that the said income disclosed by the assessee in the statement under section 132(4) is an undisclosed income as per the definition provided under section 271AAB. Therefore, the AO in the proceedings uno section 271AAB has to examine all the facts of the case as well as the basis of the s....
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....see about the charge which is to be leveled against him/her/it for levying the penalty for the contravention of the related provisions of the Act which in the instant case relates to not surrendering of undisclosed amount during the course of search which is subsequently admitted during the course of assessment and not challenged before the Ld. CIT(A). So it was incumbent for Ld. A.O that in the notice issued u/s 274 of the Act he should have mentioned that penalty u/s 271AAB of the Act may be levied on 10/20/30% since the assessee falls in Clauses (a)/(b)/(c) of section 271AAB of the Act. He should have further mentioned that as the assessee's case falls under clause-c of section 271AAB of the Act, why she should not be visited by penalty (30% of the undisclosed income. Against this charge the assessee should have been given a reasonable opportunity of being heard. From going through the above three notices issued to the assessee on 22.03.2016, 03.06.2016 and 16.09.2016, we find that there is no mention about various conditions provided u/s 271 AAB of the Act. The Ld. A.O has very casually used the proforma used for issuing notice before levying penalty u/s 271(1)(c) of the Ac....
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....lid notice u/s 274 of the Act provides a procedure that "No order imposing a penalty under this Chapter shall be made unless the assessee has been heard. or has been given a reasonable opportunity of being heard.' To comply with this requirement the notice u/s 274 should be clear enough to convey the assessee about charge which is to be leveled against him/her it for levying penalty for contravention of the related provisions of the Act. So it was incumbent for Id. AO that in the notice issued u/s 274 of the Act should have mentioned that penalty u/s 271AAB of the Act may be-levied @ 10/20/30% since the assessee falls in Clauses (a)/(b)/(c) of section 271AAB of the Act. He should have further mentioned that as the assessee's case falls under Clause-c of section 271AAB of the Act, why he should not be visited by the penalty (i.e. 30% of the undisclosed income. Against this charge. the assessee should have been given reasonable opportunity of being heard. 10. From going through the above notice issued to the assessee on 28.12.2017. we find that there is no mention about various conditions provided u/s 27IAAB of the Act. The Id. AO has very casually used the proforma ....