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TMI Blog2014 (8) TMI 165X X X X Extracts X X X X X X X X Extracts X X X X ..... ded that assessee has concealed her income or furnished inaccurate particulars of income - penalty cannot be imposed u/s 271(1)(c) of the Act against the assessee – Decided in favour of Assessee. - ITA. No. 1741/Hyd/2013 - - - Dated:- 1-8-2014 - Shri B. Ramakotaiah, A. M. And Saktijit Dey, J.M.,JJ. For the Appellant : Sri DV. Anjaneyulu For the Respondent : Sri Solgy Jose T. Kottaram ORDER Per Bench: This appeal of the assessee is directed against the order dated 25-11-2013 passed by the CIT (A)-I, Hyderabad confirming the penalty imposed u/s 271(1)(c) of the Act for the assessment year 2008-09. - 2. Briefly the facts are, the assessee is an individual and proprietrix of Bollineni Heart Centre Road No.13A, H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 1,04,48,870/-. While completing the assessment, the AO initiated proceeding for imposition of penalty u/s 271(1)(c) of the Act. In response to the show cause notice issued by the AO it was stated by her that she had admitted additional income of ₹ 35 lakh to buy peace with the department and not to prolong litigation. Further, since she has co-operated with the department in concluding the assessment and has not appealed against the assessment order, she requested for dropping the penalty proceedings. The AO however rejecting the explanation of the assessee passed an order on 27-6-2012 imposing penalty of ₹ 11,89,650/- u/s 271(1)(c) of the Act. Being aggrieved of the penalty order, the assessee preferred an appeal befor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ho has to be taxed in respect of the amounts appearing in the documents found and seized. Since she owned up the amounts as her income, she is liable for the consequences. As per the clause (ii) to Explanation 5A of section 271(1)(c), she is liable to penalty and the AO has rightly levied penalty on her. As may be noted, the appellant has been dodging payment of taxes by not disclosing full and true income till she (her husband) is confronted with the evidences. 7.1 Since there is no reasonable cause which is prevented the appellant from disclosing these transactions to the department voluntarily when the original return was filed, I am convinced that there is a deliberate attempt on the part of the appellant to conceal the particulars o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion is recorded in the assessment order by the AO, penalty is not leviable. In support of such contention, the learned AR relied on the following decisions:- i) Chennakesava Pharmaceuticals vs. CIT (349 ITR 196 (AP) ii) CIT vs. Rampoor Engg. Co. Ltd. (309 ITR 143) (Del). (FB) iii) N. Nageswara Rao vs. DCIT (ITA 367/Hyd/2000 dated 30-12-2005) 5. The learned DR, on the other hand, strongly supporting the imposition of penalty submitted that only as a result of search in course of which such incriminating material were found, the assessee was forced to declare additional income of ₹ 35 lakh. It was submitted that the assessee has also not offered any plausible explanation why such additional income was not offered by her volu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1, which are live promissory notes signed by various people (Rs. 7 lakhs each) to the tune of ₹ 35 lakhs. Please go through the same and explain the contents and also explain whether the transactions are reflected in the returns of income. Ans.: These represents the amounts given to my friends and is still lying with them. Since I can not disclose their names for social reasons, I intend to declare this amount of ₹ 35 lakhs as additional income in the hands of my wife Smt. B. Rajasree who is running a hospital under the name and style of M/s Bollineni Heart Centre for the last 5 years. This amount shall be declared as income earned by my wife from her hospital during the year year ending 31/03/2009. From the statement of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... examination of the same, we are of the view that it is not applicable to the facts of assessee s case for the following reasons. In case of Mak Data (supra), incriminating document indicating suppression of income by the assessee was found during survey operation u/s 133A of the Act. In spite of such incriminating material found as a result of survey, the assessee did not come forward and offer additional income in his return of income. Subsequently in course of assessment proceedings, when the AO again confronted those incriminating material to the assessee, being unable to explain the same, the assessee was forced to offer additional income as found in the incriminating material. Since there was no voluntary disclosure by the assessee an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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