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2015 (4) TMI 102 - AT - Income Tax


Issues Involved:
1. Quantification of undisclosed income.
2. Penalty under section 158BFA(2) of the Income-tax Act, 1961.

Detailed Analysis:

Issue 1: Quantification of Undisclosed Income

Case of Mr. Vasant Thakoor:
- The primary issue was the quantification of the exact amount of undisclosed income chargeable to tax.
- A search and seizure operation was conducted on September 4, 1997, leading to a block assessment determining undisclosed income at Rs. 53,52,237.
- The Commissioner of Income-tax (Appeals) (CIT(A)) directed further inquiries, and the Assessing Officer (AO) recalculated the income at Rs. 43,83,737.
- The Tribunal directed the CIT(A) to determine the correct quantum of addition for unexplained cash/assets/interests.
- The CIT(A) accepted the quantification of interest at Rs. 7,50,000 but disputed the quantification of cash sales of scrap/machinery, which the AO estimated at Rs. 30 lakhs.
- The CIT(A) found the correct amount to be Rs. 24.92 lakhs based on seized documents, leading to a total undisclosed income of Rs. 46,04,348.
- The Tribunal upheld the CIT(A)'s order, dismissing the appeal of the assessee.

Case of Mr. Madhukar B. Thakoor:
- The issue was similar to Mr. Vasant Thakoor's case, focusing on the quantification of undisclosed income from the sale of scrap/machinery.
- The AO initially computed the undisclosed income at Rs. 21,76,560, including Rs. 12.50 lakhs from cash sales.
- The CIT(A) re-evaluated and estimated the undisclosed income from scrap/machinery at Rs. 4,94,300.
- The Tribunal upheld the CIT(A)'s order, dismissing the appeal.

Issue 2: Penalty under Section 158BFA(2)

Case of Late Shri Balchandra B. Thakoor:
- Penalty was imposed under section 158BFA(2) for additions of Rs. 4,20,000 (unexplained fixed deposits) and Rs. 7,38,000 (interest received in cash).
- The CIT(A) sustained the penalty for these additions, noting that the assessee had sufficient time to disclose the correct income but failed to do so.
- The Tribunal upheld the CIT(A)'s order, dismissing the appeal.

Case of Mr. Mohan B. Thakoor:
- Penalty was imposed for additions of Rs. 7,71,000 (interest received in cash) and Rs. 41,305 (unexplained jewellery).
- The Tribunal upheld the penalty for the interest received in cash but found the addition for unexplained jewellery to be marginal and not warranting penalty.
- The appeal was partly allowed, sustaining the penalty for the interest received in cash.

Case of Mr. Madhukar B. Thakoor:
- Penalty was imposed for additions of Rs. 7,52,000 (interest received in cash) and Rs. 4,94,300 (cash sale of scrap/machinery).
- The Tribunal upheld the CIT(A)'s order, sustaining the penalty for both additions.

Conclusion:
The Tribunal dismissed the appeals concerning the quantification of undisclosed income, upholding the CIT(A)'s determinations. In cases involving penalties under section 158BFA(2), the Tribunal upheld the penalties for interest received in cash and other significant additions, while providing partial relief in one instance concerning unexplained jewellery. The decisions emphasize the importance of accurate disclosure and the consequences of failing to do so.

 

 

 

 

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