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2020 (5) TMI 180 - AT - Income TaxPenalty u/s.271AAA - statement recorded in the proceedings u/s.132(4) - whether any specific loose paper or investment made by the assessee? - Return filed response to the office notice issued u/s.153A - HELD THAT - Seized Loose Paper pertains to the assessment year 2012-13 and therefore, it cannot be linked to the income disclosed for the assessment year 2011-12. That further, no query or question were put forth by the Revenue Authorities to the assessee in the entire proceedings u/s.132(4) of the Act with regard to seized Loose Paper No.7 and as the Co-ordinate Bench of the Tribunal, Delhi in the case of Neeraj Singhal 2015 (3) TMI 680 - ITAT DELHI has taken a view that in such scenario, penalty u/s.271AAA cannot be levied and the same is being upheld in SHRI BANARASIDAS R. JINDAL AND OTHERS 2015 (7) TMI 159 - ITAT PUNE we are of considered view therefore that the findings arrived at by the Ld. CIT(Appeals) is not correct in law as well as in facts. We set aside the order of the Ld. CIT(Appeals) and direct the Assessing Officer to delete the penalty u/s.271AAA of the Act from the hands of the assessee.- Decided in favour of assessee.
Issues:
Imposition of penalty under section 271AAA of the Income Tax Act, 1961. Analysis: Issue 1: Imposition of Penalty under Section 271AAA The appeal pertains to the imposition of a penalty under section 271AAA of the Income Tax Act, 1961, amounting to ?5,00,000 by the Assessing Officer, which was confirmed by the Ld. CIT(Appeals). The assessee filed a condonation of delay petition as the appeal was time-barred by 31 days, citing reasons beyond their control. The Tribunal, after reviewing the petition and affidavit, condoned the delay and proceeded to hear the appeal on merits. Issue 2: Background and Assessment A search and seizure action was conducted, and the assessee filed their first return for the year under consideration on 18.09.2012, offering undisclosed income of ?50,00,000. The penalty was imposed based on the contention that the additional income declaration was made to cover up discrepancies and not linked to any specific asset or entry in the books of account. The Ld. CIT(Appeals) upheld the penalty, linking the undisclosed income to a specific loose paper seized in a subsequent assessment year. Issue 3: Assessee's Arguments The assessee argued that no specific question was asked about the seized loose paper during the proceedings, and the undisclosed income was voluntarily disclosed and accepted by the Department. They also referred to a Tribunal decision where the levy of penalty under section 271AAA was deemed unjustified in the absence of specific queries during the statement recording. Issue 4: Tribunal's Decision The Tribunal observed that the undisclosed income was disclosed and accepted for the relevant assessment year, and the penalty was linked to a loose paper seized in a subsequent year. As no queries were raised regarding the loose paper during the proceedings, the Tribunal set aside the Ld. CIT(Appeals) order and directed the Assessing Officer to delete the penalty under section 271AAA. In conclusion, the Tribunal allowed the appeal of the assessee, emphasizing the importance of specific queries during proceedings and the relevance of disclosed income for the assessment year in question. This detailed analysis covers the issues involved in the legal judgment, providing a comprehensive overview of the case and the Tribunal's decision regarding the imposition of penalty under section 271AAA of the Income Tax Act, 1961.
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