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TMI Blog2016 (5) TMI 1346X X X X Extracts X X X X X X X X Extracts X X X X ..... income was assessed at ₹ 2,15,60,620/-. We have been informed that the surrendered amount u/s 132(4) was accepted as such by the AO. There is no dispute that the tax on the amount offered had also been paid by the assessee. Thus as perused the provisions of section 271AAA which has provided that a penalty at the rate of 10% is to be levied on the amount of undisclosed income found as a consequence of search u/s 132 of I.T. Act. However, vide sub-section (2) an exception is also provided that in a situation when the offer is made of the undisclosed income u/s 132(4) and it is specified the manner in which the income was earned and duly substantiated the manner in which the undisclosed income was derived and that the tax with intere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 132(4) of I.T. Act and therein it was admitted that over and above the sale consideration a cash of ₹ 2 crore was also paid. The AO has recorded that because of the said statement recorded u/s 132(4) the actual sale consideration of the land was at ₹ 4,75,65,000/-. The offered amount of ₹ 2 crores was disclosed as per the income-tax return filed for assessment year 2009-10 and 2010-11. While levying the penalty the observation of the AO was that the evidences were gathered during the course of search and when those evidences were confronted the actual sale consideration was admitted. The amount in question was the disclosed income which was detected at the time of search, therefore, the assessee is subject to penalty u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nalty u/s.271AAA of the I T Act stating that the appellant has failed to specific and substantiate the manner in which the undisclosed income had been derived. The AO. has stated that the appellant remained silent on the issue and accordingly he levied the penalty. The AR. of the appellant on the other hand has argued vehemently that the penalty levied is duly unjustified as all the conditions as mentioned u/s.271AAA have been complied in the case. Section 271 AAA(2) is reproduced as under :- .... Nothing contained in sub-section (1) shall apply if the assessee - (i) In the course of the 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appellant has shown ₹ 2 crore as other income credited in its P L account. From this it is evident that the appellant has declared ₹ 2 crore as other income (business income) which has been duly credited in the P L account. Thus, there is an iota of doubt that the appellant had not declared the same as business income. Further, once the same has been declared as business income and has been duly reflected in it P L account and relevant taxes have been paid,inmy considered view, I have no hesitation in holding that the second conditionas stated in section 271AAA is also satisfied in this case. The AR. Of the appellant has also relied upon the following decisions in its support :- Commissioner of Income Tax Vs. Subhir Jain (2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion mentioned in the registered deed. As a consequence a revised return was filed. The assessment was completed u/s 143(3) and the income was assessed at ₹ 2,15,60,620/-. We have been informed that the surrendered amount u/s 132(4) was accepted as such by the AO. There is no dispute that the tax on the amount offered had also been paid by the assessee. In the light of the above mentioned admitted facts we have perused the provisions of section 271AAA which has provided that a penalty at the rate of 10% is to be levied on the amount of undisclosed income found as a consequence of search u/s 132 of I.T. Act. However, vide sub-section (2) an exception is also provided that in a situation when the offer is made of the undisclosed income u ..... X X X X Extracts X X X X X X X X Extracts X X X X
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