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TMI Blog2015 (9) TMI 130X X X X Extracts X X X X X X X X Extracts X X X X ..... on in respect of its undisclosed income of Rs. 15,38,990 for the period under consideration. Ld. DR further submitted that in view of the facts of the case and decision of Hon'ble High Court wherein the addition pertaining to said undisclosed income of the assessee has been sustained, the provisions of section 158BFA(2) of the Act are squarely applicable and therefore, the AO was quite justified in imposing penalty of Rs. 10,15,733 i.e. @100% of tax on undisclosed income of the assessee company. Ld. DR has placed reliance on the judgment of Hon'ble High Court of Rajasthan dated 12.2.2014 in the case of Apex Metchem (P) Ltd. vs ACIT in DB ITA-5/2014, the judgment of Hon'ble Gujarat High Court dated 8.11.2011 in the case of Kondoi Bhogilal Mulchand vs DCIT in ITA No.2467 of 2010, order of ITAT Mumbai 'E' Bench dated 30.6.2011 in the case of Triumph International Finance Ltd. vs ACIT in IT(SS)A No. 160/Mum/2007 and decision of ITAT 'H' Bench dated 30.4.2009 in the case of M/s Ahujasons Shawlwale Pvt. Ltd. vs DCIT in IT(SS)A No. 146 (Del) of 2005 and also placed contentions of the revenue by way of reading the relevant paras of these judgements and orders. 3. Replying to the above, ld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uding SLPs of the assessee against the order of Hon'ble High Court dated 29.10.2012 have been dismissed at the admission stage without any detailed deliberations. 5. Ld. DR also placed a rejoinder to the above submissions of the assessee and submitted that when the issue has attained finality in the hands of Hon'ble Apex Court wherein the SLPs filed by the assessee have been dismissed, then the issue does not remain debatable and attains finality. Ld. DR further pointed out that the orders of the Tribunal as relied by the ld. Counsel of the assessee (supra) pertain to a situation when the penalty was deleted on the ground that the issue has not attained finality as the SLP is pending before Hon'ble Apex Court in the present case, the issue has attained finality, therefore, the penalty cannot be deleted merely on the basis that the issue has not attained finality due to pending SLP before the Hon'ble Supreme Court. 6. On careful consideration of above submissions and vigilant perusal and consideration of the relevant material and ratio of the orders and judgment relied by both the parties, at the very outset, we note that in the unaccounted profit and loss account and balance shee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate which falls before the date of search, therefore, provisions of section 158BB(1)(c) of the Act were rightly applied by the AO and therefore, impugned long term capital gain has to be treated as undisclosed income of the assessee and the action of the AO was confirmed by the Hon'ble High Court. Subsequently, the AO levied penalty u/s 158BFA(2) and the aggrieved assessee filed an appeal before the first appellate authority i.e. CIT(A) by submitting that the AO had wrongly concluded that the penalty u/s 158BFA(2) is automatically leviable if the income is treated as undisclosed income and the AO has not applied his mind to the facts and circumstances of the case on the issue of recording satisfaction. It was also submitted on behalf of the assessee that the AO has ignored the submissions of the assessee that the matter of determination of undisclosed income being sub judice before the Hon'ble Supreme Court on account of SLP filed by it, hence, penalty needs to be kept in abeyance. 9. On careful and vigilant reading of the findings of the CIT(A), from para 4 to 4.9 of the impugned orders, we note that in the beginning of the order, the CIT(A) noted that the assessment proceedings ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supreme Court in the case of Dilip N. Shroff vs. CIT (2007) (291 ITR 519 (SC) and T. Ashoke Pai vs. CIT (2007) (292 ITR 11) (SC). i.e. (i) Both the expressions "concealment of income" and "furnishing of inaccurate particulars" indicate some deliberation on the part of the assessee, though the word "deliberately" and the word wilfully" are no longer part of the statue. (ii) Mere omission or negligence would not constitute a deliberate act of suppressiio veri or suggestio falsi. (iii) Primary burden of proof is on the revenue. The statute requires satisfaction on the part of the Assessing Officer. He is required to arrive at a satisfaction so as to show that there is primary evidence to establish that the assessee had concealed the amount or furnished inaccurate particulars and this onus is to be discharged by the department. (iv) The Assessing officer while considering levy of penalty should consider whether the assessee has been able to discharge his part of the burden. He should not begin with the presumption that the assessee is guilty. (iv) Though penalty proceedings under the income-tax law may not be criminal in nature, they are still quasi-criminal requiring the De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is quite likely that the appellant might be waiting for the requisite details of shares sold and this may be the genuine reason for not been able to file the return of income by due date i.e. 31.12.1999, but the fact remains that he did file the return within the time allowed under section 139(4). Further, while invoking the penal provision apart from above the AO cannot overlook this fact, that the financial statements (found during the search) did record the transaction relating to shares on which capital gain is earned and duly been declared in the return of income file on 31.03.2000. 4.6 Here 1 would like to rely on the decision of ITAT Chennai Bench dated 07.06.2011 in the case of K. Ramakrishnan (HUF) vs. DCIT (IT(55) No. 7 of 2011), where on the similar facts the ITAT has held penalty under section 158BFA (2) is not leviable if the return of income is not filed by the due date, but the income be assessed as undisclosed income within the meaning of section 158BB(1)(c). FACTS A search and seizure action under section 132 was carried out in the case of the assessee. The seized materials made out a case of undisclosed income. The Assessing Officer thus initiated proceeding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and technically not valid, the assessee had already returned the capital gains liable for taxation in its hands. If that amount of capital gains was impregnated in the block return filed by the assessee, the equation would become completed. The only correction was calculating tax at 60 per cent instead of 20 per cent. If the assessee had not furnished its belated related immediately after the search, the assessee would have definitely offered the capital gains for taxation in its block return. If that amount was offered through the block return there would be no cause of action to impose penalty. Therefore, the only mistake committed by the assessee was attracted a little over smart and over cautions/ even though the endeavour of the assessee was not productive. [para 6] In the facts and circumstances of the case/ it was opined that the levy of penalty was not justified. It was to be deleted. [para8] In result appeal filed by the assessee was to be allowed." 4.7 Here, I would also like to take strength from the decision dated 12.11.2008 of Delhi High Court in the case of CIT vs. Harkaram Das Ved Pal (117 Taxman 398) Delhi where Hon'ble Court has held that the penalty i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pinion either between different Benches of Tribunal or the High Courts, which is finally settled by the pending judgment of the Supreme Court and all necessary facts have been disclosed by the assesses in its return, the penalty is not warranted. " 4.9 Thus in view of the above discussions, I am of the considered view that in the facts of the appellant's case, the imposition of penalty under section 158BFA(2) is not on automatic fall out or mandatory, hence the penalty levied by the AO, is deleted." 11. In view of above, it is vivid that the CIT(A) granted relief for the assessee deleting the impugned penalty by observing that the special leave petition was pending before the Hon'ble Supreme Court against the quantum order of the Hon'ble High Court dated 29.11.2010, where penalty u/s 158BFA is not an automatic fall out or mandatory specially when the old necessary facts have been disclosed by the assessee in its return. 12. Now, we proceed to consider the ratio of the orders of the Tribunal in the case of DCIT vs M/s A. T. Invofin India P. Ltd. in IT(SS) No.12/Del/2013 and DCIT vs M/s Mehrotra Invofin India Pvt. Ltd. (supra) which support the view taken by the CIT(A) that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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