2013 (1) TMI 717

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..... 06. A statement of Shri Sunil Chug, the director of the assessee-company, was recorded under section 132(4) of the Act. In this statement, surrendered a total undisclosed income of Rs. 151.01 lakhs was made. This surrender was on account of unrecorded receipts and on account of wrong claims to deduction. The assessee has honoured this surrender by disclosing it in its return of income (ROI) filed in response to notice issued under section 153A of the Act. The assessee has paid tax on this surrendered amount. In penalty proceedings initiated under section 271(1)(c) of the Act, the assessee- company has sought benefit of Explanation 5 appended to section 271(1)(c) of the Act. The Assessing Officer and the learned Commissioner of Income-tax (A .....

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..... before the said date or, where such return has been furnished before the said date, such income has not been declared therein; or (b) for any previous year which is to end on or after the date of the search, then, notwithstanding that such income is declared by him in any return of income furnished on or after the date of the search, he shall, for the purposes of imposition of penalty under clause (c) of sub- section (1) of this section, be deemed to have concealed the particulars of such income or furnished inaccurate particulars of such income, unless,- (1) such income is, or the transactions resulting in such income are recorded,- (i) in a case falling under clause (a), before the date of the search ; and (ii) in a case falling und .....

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..... challenge. Hence, the assessee was entitled to the immunity under Explanation 5 to section 271(1)(c). Penalty could not be imposed." 6. Another similar decision of the hon'ble Rajasthan high Court was rendered in the case of Gebilal Kanhaiyalal (HUF) v. Asst. CIT [2004] 270 ITR 523 (Raj). This decision has been approved by the hon'ble apex court and is reported as Asst. CIT v. Gebilal Kanhaiyalal [2012] 348 ITR 561 (SC). The held portion of the Rajasthan High Court decision is as under : "that, in the instant case, there was no dispute about the fact that the search continued till August 1, 1987, and on August, 1, 1987, in the statement, the assessee had disclosed a particular concealed income and surrendered it for tax and tax .....

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