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2020 (12) TMI 850 - AT - Income TaxPenalty u/s. 271AAA - payment of taxes were not made on the amount surrendered within the due date - HELD THAT - CIT(A) has only incorporated the figures given at serial number 1 to 10 and has failed to consider the taxes deposited from serial number 11 to 17 which was not on account of income shown in the return of income. Further, this fact has also been corroborated from the computation of income filed along with return of income, the details of which as incorporated above also matches with Form 26AS. Thus, all the payment of taxes along with interest were duly paid much before due date of filing of return of income. Therefore, the allegation in the charge of the Ld. CIT(A) is completely divorced from the facts and material on record. Accordingly, ground which the Ld. CIT(A) has confirmed the penalty is dismissed. Apart from that, precisely on similar issue and on similar findings of the Ld. CIT(A) in the group cases of the assessee, the Tribunal has come to an independent conclusion that the Ld. CIT(A) has wrongly inferred/interpreted the Form 26AS and therefore, the finding of the Tribunal will also apply mutatis mutandis in this appeal also. Accordingly, the penalty of ₹ 50 Lakhs levied u/s. 271AAA of the Act is directed to be deleted.
Issues:
Challenge to levy of penalty under section 271AAA for Assessment Year 2010-11 based on non-payment of taxes on surrendered amount within due date. Detailed Analysis: 1. Challenge to Penalty Levy: The appellant contested the penalty of ?50 Lakhs imposed under section 271AAA for non-payment of taxes on the surrendered amount within the due date. The appellant had disclosed ?5 Crores during a search and seizure action, which was accepted by the Assessing Officer in the return of income filed under section 153A. The penalty was initiated as the appellant failed to specify the manner in which the undisclosed income was earned at the time of surrender. 2. Submission Before CIT(A): The appellant contended before the CIT(A) that they had substantiated the manner of earning the undisclosed income, which was accepted by the CIT(A) based on judicial pronouncements. However, the CIT(A) raised concerns regarding the payment of taxes and interest on the surrendered income, prompting the appellant to provide details of tax payments. 3. Payment of Taxes Issue: The CIT(A) confirmed the penalty on the ground that the appellant did not pay the taxes within the due date of filing the return. The CIT(A) relied on Form 26AS to infer that taxes were paid beyond the due date, contrary to the appellant's claims. The appellant presented evidence of tax payments made well before the due date, disputing the CIT(A)'s findings. 4. Appellant's Arguments: The appellant highlighted the details of pre-paid taxes amounting to ?4,45,18,650 on the return of income, emphasizing that all taxes were paid before the due date. They also referred to Form No. 26AS to support their claim that taxes were paid in advance. The appellant cited previous tribunal judgments where similar penalty impositions were overturned due to erroneous interpretations of tax payment timelines. 5. Tribunal Decision: The Tribunal noted that the CIT(A)'s charge regarding non-payment of taxes within the due date was incorrect. All taxes and interest were paid by the appellant before the due date, as evidenced by Form 26AS and computation of income. The Tribunal found the CIT(A)'s findings to be divorced from the facts and material on record, leading to the dismissal of the confirmed penalty. 6. Precedent and Final Decision: Referring to previous cases within the appellant's group, the Tribunal concluded that the CIT(A) misinterpreted Form 26AS, leading to the penalty imposition being overturned. The penalty of ?50 Lakhs under section 271AAA was directed to be deleted, and the appeal of the assessee was allowed. In conclusion, the Tribunal ruled in favor of the appellant, emphasizing that all taxes were paid before the due date, and the penalty was unjustified based on the evidence presented.
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