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TMI Blog2016 (5) TMI 848X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act was conducted in the premises of the assessee. Subsequently notice u/s. 158BC was issued to the assessee on 16/11/2001. On the basis of the statement given by one of the partners u/s. 132(4) of the Act and the material seized during the course of search, the Assessing Officer, vide order dated 27/06/2003 determined the undisclosed income at Rs. 31,00,724/-. The Assessing Officer observed from the books of account seized during the course of search that it was clear that the unaccounted transactions were carried out. It was further observed that the entries recorded were 1/100th of the real figures. To determine the addition, the AO multiplied the figures by 100 and arrived at the addition of Rs. 37,51,374/- on account of unaccou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is in appeal before us and has challenged the aforesaid order of the Ld. CIT(A) who confirmed the penalty imposed by the Assessing Officer. 8. The Ld. AR has argued that the penalty levied on the assessee should be deleted as there was no evidence to suggest that the assessee had earned unaccounted income except for the statement made by one of the partners. The Ld. AR further argued that the addition has been made on an estimation basis and therefore, penalty cannot be levied. 9. The ld. DR on the other hand has rebutted the submissions made by the Ld. AR. He relied upon the orders passed by the Assessing Officer and the Ld. CIT(A) to support his submissions. 10. We have heard the rival contention and perused the facts of the case. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee, so as to suggest the earning of unaccounted income. Also, the Assessing Officer has not brought on record any document pertaining to loan transaction which was executed for a higher amount than what is reflected in the books of account. The Assessing Officer had computed the addition on lumpsum basis rather than making separate additions for each year. 12. As regards the interest income is concerned, the Assessing Officer had relied upon the statement made by one of the partners of the assessee and the addition is not made on the basis of concrete documentary evidence found during the course of search. This clearly shows that the additions made in the case of the assessee were on the basis of estimation. There is no independen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount as declared by the assessee in the account books. The CIT(A) in the quantum proceedings estimated the value of investment at Rs. 30 lakhs as against Rs. 40 lakhs made by the Assessing Officer. Under these circumstances, in our view, the CIT(A) has correctly appreciated the facts and circumstances of the case and held that the impugned addition on account of unexplained investment in house property of Rs. 11,71,687/- was on estimation basis and not on the basis of any concrete evidence found in the course of search towards incurrence of unaccounted expenditure qua the impugned property. Therefore, having regard to the facts and circumstances of the present case, we affirm the action of the CIT(A) in deleting the penalty with respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Before us, no cogent material or reasoning has been advanced by the Ld. Departmental Representative to say that any document or evidence was found in the course of search which would indicate clinchingly incurrence of unaccounted expenditure on marriage of assessee's daughters. Merely because, assessee's explanation with respect to the loose papers was rejected in the quantum proceedings and the marriage expenses estimated cannot be a ground to levy penalty u/s 158BFA(2) of the Act in the context of the facts and circumstances of the present case. Therefore, order of the CIT(A) on this aspect is also hereby affirmed. 12. Thus, we find no reasons to interfere with the decision of the CIT(A) which is hereby affirmed and accordingly, Reven ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... found to be untrue. 8. In the case of Mahendra Vyas (supra), the coordinate Bench has held as under:- "8. We do not agree with the submission of Revenue that penalty u/s. 158BFA is mandatory in view of the decision of Rajasthan High Court in the case of CIT vs. Satyendra Kumar Dosi (2009) 315 ITR 172 where the Hon'ble High Court has held that levy of penalty u/s. 158BFA(2) is discretionary and not mandatory. 9. In the case of CIT vs. Becharbhai Parmar (Supra) the Hon'ble Guj. High Court has held as under: "Sub-section(2) of Section 158BFA makes it clear that it is well within the discretion of the Assessing Officer while framing the assessment for the block period, whether or not to impose any penalty or not. The words, "may dir ..... X X X X Extracts X X X X X X X X Extracts X X X X
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