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TMI Blog2015 (8) TMI 874X X X X Extracts X X X X X X X X Extracts X X X X ..... the undisclosed income was current year's business income. Ld. CIT(A) has also noted that clause (iii) of subsection 2 of section 271AAA was also satisfied by the assessee as the assessee had paid the tax along with interest. Ld. CIT(A) has thus given a finding that that the 3 conditions specified under section 271AAA were satisfied by the assessee in the light of decisions of Hon’ble Gujarat High Court and Allahabad High Court CIT v. Radha Krishna Goel [2005 (4) TMI 47 - ALLAHABAD High Court] and therefore no penalty was leviable. Before us, Revenue has not brought any material on record to controvert the findings of ld. CIT(A) nor has placed on record any contrary binding decision. In view of the aforesaid facts, we find no reason to interfere with the order of ld. CIT(A) and thus the ground of Revenue is dismissed. - Decided in favour of assessee. - I.T. A. No. 1145/AHD/2012 - - - Dated:- 13-8-2015 - SHRI RAJPAL YADAV AND SHRI ANIL CHATURVEDI, JJ. For The Appellant by : Shri Pravin Kumar, D.R For The Respondent by : Shri Rasesh Shah, A.R. PER ANIL CHATURVEDI, ACCOUNTANT MEMBER 1. This appeal filed by the Revenue is against the order of CIT(A)-II, Ahmedabad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provided in sub-section (2) of section 271AAA are reproduced as under: (i)In the course of search, in a statement under sub-section (4) of section 132, admits the undisclosed income and specifies the manner in which such income has been derived; (ii) Substantiates the manner in which the undisclosed income was derived and (iii) Pays the tax together with interest, if any, in respect of the undisclosed income. Clause (i) lays down the first condition that undisclosed income should have been admitted by Dipesh L. Shah (brother of assessee) in the statement u/s 132(4) and assessee should specify the manner in which it has been derived. Shri Dipesh L Shah, in the statement recorded on 20.01.2009, in the course of search stated in reply to questions no.34 that he was disclosing ₹ 1 crore for the assessee for financial year 2008-09 representing current year income. He clearly mentioned that undisclosed income was declared on account of current, year income. This clearly implies that the income is earned in current year from business. The assessee in his statement recorded u/s 132(4) disclosed ₹ 100.00 lacs as current year's income and to cover any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ract penalty provisions. But an exception is provided in clause (2) of Explanation 5 where the deeming provision will not apply if during the course of search the assessee makes the statement under sub-section (4) of section 132 that the money, bullion, jewellery etc. found in his possession has been acquired out of his income which has not been disclosed so far in his return of income and also specifies in the statement the manner in which such income has been derived and-pays the tax together with interest, if any, in respect of such income....under section 132(4) of the Act, unless the authorized officer puts a specific question with regard to the manner in which income has been derived, it is not expected from the person to make a statement in this regard and in case in the statement the manner in which income has been derived has not been stated but has been stated subsequently, it amounts to compliance with Explanation 5(2). If there is nothing to the contrary in the statement recorded under section 132(4) of the Act, in the absence of any specific statement about the manner in which such income has been derived, it can be inferred that such undisclosed income was derived fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cluded disclosure amount of ₹ 1,00,00,000/- made during search while recording statement u/s.132(4) of the Act. The A.O. has not made any comment or observation about the source .and nature of income, manner in which income was derived or substantiating the manner. This shows that the A.O. himself was satisfied about the income offered in return of income. In view of these facts and circumstances of the case and the principles laid down in the decisions by the Hon'ble High Courts narrated above in paras 4.1 and 5.3 of this order, it is held that the Assessing Officer was not justified in levying the penalty u/s 271AAA of the Act and hence the same is deleted. 4. Aggrieved by the order of ld. CIT(A), Revenue is now in appeal before us and has raised the following grounds:- 1. The Ld.CIT(A) has erred in law and on facts in directing the AO to delete the penalty of ₹ 10,00,000/- levied by the Assessing Officer u/s.271AAAofthe Act. 5. Before us, learned DR supported the order of AO. On the other hand learned A.R. reiterated the submissions made before AO and ld.CIT(A) and supported the order of ld. CIT(A). 6. We have heard the rival submissions and p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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