9911796707
TMI Blog2016 (3) TMI 81X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee has surrendered this amount to tax which is not voluntary act on the part of the assessee, but because of the proceeding initiated by the AO, after this fact of accommodation entries was detected in the search and survey proceedings. Therefore, the surrender of the amount by the assessee pre-empts the further investigation during the assessment proceedings. Even otherwise when the assessee has admitted this amount as income then no further investigation was required on the part of the AO to prove that this amount was received on account of accommodation entries received by the assessee. As relying on Hon'ble Supreme Court in the case of Mak Data Vs. CIT [2013 (11) TMI 14 - SUPREME COURT ] the penalty levy u/s 271(1)(c) is confirmed. - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c to the income of the assessee comprising ₹ 2 lac each from these three parties. The assessee has surrendered this amount of ₹ 6 lac to taxing. Accordingly, the AO made an addition of the said amount of ₹ 6 lac in the hands of the assessee being assessee's own money. Subsequently, the AO initiated penalty proceeding u/s 271(1)(c) and levy a penalty of ₹ 2,19,555/- being 100% of tax sought to be evaded vide order dated 20.09.2013. The assessee challenged the action of the AO before learned Commissioner of Income-tax (Appeals) but could not succeed. 4. Before this Tribunal the AR of the assessee has submitted that the assessee has surrendered the amount of ₹ 6 lac received from three persons which does not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elf surrender is not applicable in the case of the assessee. When the assessee has explained the source of this amount by supporting evidence then though the explanation was not relevant for the purpose of the assessment as the assessee surrendered this amount however, the same is very relevant for the purpose of levy of penalty u/s 271(1)(c). The ld AR has relied on the decision of Hon'ble Allahabad High Court in the case of Punjab Rice Mills Vs. CIT, 211 Taxmann 127 (Ald) and submitted that explanation to section 271(1)(c) in clause A is attracted when the person fails to offer an explanation or offers an explanation which is found to be false. Whereas clause-B of the explanation is attracted in a case where such person offers an expl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pon the judgment of the Hon'ble Supreme Court in the case of MAK Data Pvt. Ltd. Vs. CIT 358 ITR 593. The ld DR has also relied on the order of the authorities below. 6. I have considered the rival submission as well as relevant material on record. There is no doubt that the AO has initiated the penalty proceeding by making the addition on the basis of information of receiving the accommodation entries by the of the assessee which was detected during the search and survey proceedings. Though there was confusion about the names of the parties from whom the assessee has received the amount however ultimately the assessee admitted to have received these amounts from three parties and decided to surrender this amount for taxation. Hence, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... putation of his total income have been disclosed by him, then the amount added or disallowed in computing the total income of such person as a result thereof shall, for the purposes of clause (c) of this sub-section, be deemed to represent the income in respect of which particulars have been concealed." 7. The AO, in our view, shall not be carried away by the plea of the assessee like "voluntary disclosure", "buy peace", "avoid litigation", "amicable settlement", etc. to explain away its conduct. The question is whether the assessee has offered any explanation for concealment of particulars of income or furnishing inaccurate particulars of income. Explanation to Section 271(1) raises a presumpt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, affidavits, copies of Income Tax Returns and assessment orders and blank share transfer deeds duly signed, have been impounded in the course of survey proceedings under Section 133A conducted on 16.12.2003, in the case of a sister concern of the assessee. The survey was conducted more than 10 months before the assessee filed its return of income. Had it been the intention of the assessee to make full and true disclosure of its income, it would have filed the return declaring an income inclusive of the amount which was surrendered later during the course of the assessment proceedings. Consequently, it is clear that the assessee had no intention to declare its true income. It is the statutory duty of the assessee to record all its transact ..... X X X X Extracts X X X X X X X X Extracts X X X X
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