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TMI Blog2015 (6) TMI 285X X X X Extracts X X X X X X X X Extracts X X X X ..... , 5236, 5237, 5238/Mum/2012 - - - Dated:- 29-5-2015 - Shri B R Baskaran Shri Amit Shukla, JJ. For the Appellant : Dr. Prayag Jha For the Respondent : Shri Akhilendra Yadav ORDER Per Amit Shukla, Judicial Member The aforesaid appeals have been filed by the assessee against the common order dated 21.06.2012 passed by the CIT(A) 41, Mumbai, in relation with the penalty proceedings u/s. 271(1)(c) of the I.T Act, for the assessment years 2003- 04, 2004-05, 2005-06, 2006-07 and 2007-08. Since the issues involved in all the appeals are common and are arising out of similar set of facts, therefore, they were heard together and are being disposed off by this consolidated order. 2. The assessee is mainly aggrieved by levy of penalty u/s. 271(1)(c) on account of additional income offered in the return filed u/s. 153A in pursuance of search and seizure action u/s. 132 of the I.T. Act. The particulars of total income returned, total income assessed, additional income offered and penalty levied u/s. 271(1)(c) for various assessment years are as under: Assessment years Total Income Returned Total Income Assessed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s case is covered by Explanation 5A to section 271(1)(c), as the assessee had declared additional income after the search was conducted and penalty is leviable, the return u/s. 153A was not filed within twenty days of notice. Thus, after invoking the provisions of Explanation 5A, the Assessing Officer levied penalty for all the assessment years, as per the details mentioned above. 3. Before the CIT(A), the assessee submitted that the Assessing Officer accepted the return u/s. 153A and income has been assessed on the same income therefore, no penalty should be levied. The relevant submission of the assessee before the CIT(A) are as under: i. Certain expenses were incurred by appellant towards payments of salaries to domestic servants and drivers ii. Some loose papers were found/Seized in respect of salaries paid to Domestic servants and drivers iii. The loose papers were found for part of the period of Bloc Assessment Years. However, the appellant has made voluntary disclosure in respect of Domestic Servants and Drivers for all the assessment years covered under block assessment. iv. Revised returns were filed in response to notice u/s. 153A v. Revised returns are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal, Mumbai Bench in the case of Ajit B Zota Vs. ACIT (40 SOT 543). 4. Before us, the learned counsel Dr. Prayag Jha, submitted that Explanation 5A cannot be invoked without, satisfying the conditions laid down in the main section itself. The conditions like recording of satisfaction with regard to concealment of income or furnishing of inaccurate particulars which are mandatory. If such conditions are not fulfilled, then under the main provisions itself, penalty cannot be invoked. He submitted that Explanation 5A cannot substitute the main section 271(1)(c). The Explanation cannot override the necessity of fulfilling the conditions set out in the substantive part of the section. In support of his contentions, he strongly relied upon the decision of the Hon ble Bombay High Court in the case of CIT vs. Jet Airways India Ltd. (2010) 331 ITR 236, which was rendered in context of re-opening u/s. 147, wherein the Hon ble High Court held that the condition precedent to the exercise of jurisdiction u/s. 147 is formation of a reason to believe by the Assessing Officer that any income chargeable to tax has escaped assessment. If there is no such reason to believe then entire re-opening ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the notice u/s. 153A, the assessee has declared additional income in various years as per the details mentioned in the foregoing paragraph. The Assessing Officer has invoked Explanation 5A to section 271(1)(c) for levying the penalty. Before us the assesee s case is that the conditions laid down in main provision of section 271(1)(c) should be fulfilled before invoking Explanation 5A. Now whether in this case the said conditions like recording of satisfaction with regard to concealment of income or furnishing of inaccurate parties have not been fulfilled or not. From the perusal of the assessment order it is seen that the Assessing Officer has categorically noted that the declaration of additional income in respect of payment of salary etc., has been made in view of certain loose papers and incriminating material found during the course of search. Thereafter, he has mentioned that penalty proceedings u/s. 271(1)(c) is being initiated. This remark of the Assessing Officer in the assessment order itself construes his satisfaction for initiating the penalty proceeding under section 271(1)(c). Sub section (1B) has been brought in statute by Finance Act 2008 with retrospective effect fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deemed to have concealed the particulars of his income or furnished inaccurate particulars of such income. From the plain reading of the above Explanation it is amply clear that the Explanation is applicable in the cases where search u/s. 132 has been initiated after 01.06.2007 and in the course of such search, the assessee is found to be the owner of , firstly, any assets like money, bullion, jewellery or other valuable article or thing; secondly, any income based on any entry in books of account or other documents or other transactions; and if the assessee claims that such asset or income have been acquired by him by utilizing the income or represents his income for any previous year or which has ended before the date of search and return of income for such previous year has been furnished before the said date, but not declared in the return of income or the due date for filing the return of income has expired. In such a situation, even if such income has been declared in the return of income furnished after the date of search is deemed to have concealed particulars of income or furnished inaccurate particulars of such income. Thus, there is no exception provided in the sai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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