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TMI Blog2016 (6) TMI 533X X X X Extracts X X X X X X X X Extracts X X X X ..... horities evidently proves that there was cash on hand available with the assessee from the company of which assessee is one of the director. Further the balance cash on hand the hands of the assessee’s parents as well as on the bedroom of the assessee is also covered by the amount of cash on hand with that company. Further, this explanation was already available by letter dated 27/09/2002 filed before the Deputy Director of Income Tax ( investigation). Similarly, the explanation for the jewellery found was also given vide same letter . Therefore, though the additions have been confirmed on the basis that this is an afterthought but merely because the addition has been confirmed, the penalty under section 158BFA , which is not automatic, can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence indicating undisclosed income not disclosed in the block return, was unearthed during the course of search u/s 132(1) of the Income Tax Act, 1961 conducted on 17.7.2012. iv) The appellant craves leave to alter, amend or add any other ground of appeal either before or during the course of hearing. 2. The first ground of appeal is general in nature and therefore is dismissed. 3. All the other grounds of the appeal simply relates to the levy of penalty under section 158BFA (2) of ₹ 5 19750/-. Therefore we deal with the all the grounds of the appeal on the merit of the addition and on the quantum of the penalty. 4. Brief facts of the case are that search and seizure operation was carried out at the residence of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich was retracted on 27.9.2009, and further the source of the case found was belonged to the saving of the entire family. Further ₹ 2,85,000/- belong to M/s. Cain Technologies (India) Pvt. Ltd. wherein assessee was the director and on the date of search as per the books of accounts of the company, cash balance of ₹ 6,29,336/- was available. Therefore, he submitted that the explanation of the assessee was rejected. But it was not false. Regarding the second addition on account of jewellery, he submitted that the jewellery was acquired by mother of the assessee and though this affidavit was filed before the Ld. AO, which remained uncontroverted. Further he stated that benefit of circular No. 1916 dated 11.5.1994 has not also been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he date of search , that company was having cash on hand of ₹ 6.29 lakhs . This explanation of the assessee was disbelieved. Regarding, the source of the case found from the bedroom of the assessee's parents and from the bedroom of the assessee, it was submitted that they are out of the family savings. Concurrently the additions have been upheld in the hands of the assessee by the Ld. Commissioner of income tax (APPEALS) and the Income Tax Appellate Tribunal. The main reason for upholding the addition by the Hon'ble ITAT was that during the course of search nowhere the assessee had stated that cash was belonging to the company Cain technologies India private limited and the bank statement of that particular company was not produced an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enefit of circular No. 1916 dated 11th may 1994 regarding the sources of jewellery in the hands of various persons of the family. It was further stated that if the benefit of the circular is given to the assessee that the addition also would not have been made based on several judicial precedents relied upon by the assessee. ii) We have considered the whether the penalty under section 158BFA can be levied on the above two additions sustained concurrently by the authorities. It is now a settled issue that penalty under section 158 BFA is not automatic and cannot believe levied merely because the addition has been confirmed. On both the two additions above it is apparent that had the assessee produced the cashbook as well as the withdrawal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vied .The provisions of section 158BFA (2) are as under :- "(2) The Assessing Officer or the Commissioner (Appeals), in the course of any proceedings under this Chapter, may direct that a person shall pay by way of penalty a sum which shall not be less than the amount of tax leviable but which shall not exceed three times the amount of tax so leviable in respect of the undisclosed income determined by the Assessing Officer under clause (c) of section 158BC" According to the provisions of section 158BFA (2) the assessing officer is required to work out 100 % of tax sought to be evaded on account of the undisclosed income and also maximum penalty leviable at 300% of the tax on undisclosed income and then levy penalty between theses limits ..... X X X X Extracts X X X X X X X X Extracts X X X X
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