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TMI Blog2017 (12) TMI 473X X X X Extracts X X X X X X X X Extracts X X X X ..... se, the entire undisclosed income has been offered for tax by the appellant-company in the return income, which was subject matter of assessment before assessing officer. The return filed by the appellant has been accepted as such by your assessing officer, without any variation. Therefore, in the absence of any undisclosed income being found in the assessment vis-a-vis the return filed, the issue of imposition of penalty does not, arise. - Decided in favour of assessee. - I.T.A. No.5748/Del/2014 - - - Dated:- 7-12-2017 - SHRI H . S . SIDHU, JUDICIAL MEMBER AND SHRI L . P . SAHU, ACCOUNTANT MEMBER For The Assessee : Sh . R . S . Ahuja, CA For The Revenue : Sh . S . S . Rana, CIT ( DR ) ORDER PER H . S . SIDHU, JM This appeal is filed by the Assessee against the Order dated 09.7.2014 passed by the Ld. CIT(A)(Central) relating to Assessment Year 2007-08 on the following grounds:- ( A ) That on the facts and circumstances of the case the Ld . ITO CIT ( A ) erred in : 1 ) Imposing penalty u / s . 271 ( 1 )( c ) amounting to Rs . 2,36,000 /-. 2 ) Levying pen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ely from 1.6.2007 and therefore assessee was liable for penalty under section 271(1)(c) of the Act. 7. We have heard the rival submissions and perused the relevant material on record. We find that in the case of Alok Bhandari in ITA No. 5747/Del/2014 for assessment year 2006-07 following grounds was taken before the Tribunal:- ( A ) That on the facts circumstances of the case the learned ITO the CIT ( A ) erred in : 1 ) Imposing penalty u / s 271 ( 1 ) amounting to Rs . 2,69,000 /- 2 ) Levying penalty in spite of the fact that law applicable for imposing the penalty u / s . 271 ( 1 )( c ) is the law in force at the time of filing of original return . The original return was filed on 03 . 03 . 2009 while the finance Act ( No . 2 ) of 2009 came in effect from 01 . 04 . 2009 passed in Lok Sabha on 27th July, 2009 and in Rajya Sabha 29th July 2009 and assented on 19th August, 2009 with retrospective effect 01 . 06 . 2007 . 3 ) Ignoring the fact that explanation 5A of Section 1271 ( 1 ) was inserted by the Finance Act 2009, w . e . f . 01 . 06 . 2007 which is after the assessment y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment year 2007 - 08, the appellant company has filed return of income under section 139 ( 1 ) of the Act on 31 . 07 . 2007 . In view of the aforesaid, deeming fiction enacted in the aforesaid Explanation 5A as on the statute on 03 . 03 . 2009, i . e . , the date of filing in return of income under section 153 A of the Act, is not at all applicable to the facts of the appellant - company . Thus the Assessing Officer erred in imposing the penalty on the assessee . 5 . 1 . The facts of the case in the present appeal in fact are that search and seizure operation under section 132 of the Act was carried out in the case of the appellant and its group concerns on 7th February, 2008 . During the course of search statement of Sh . Dharmendra Bhandari, was recorded under section 132 ( 4 ) of the Act wherein undisclosed income of Rs . 8,00,000 /- was surrendered . Accordingly, based on the aforesaid disclosure made during the course of search and seizure operation, the appellant, in the return filed on 03 . 03 . 2009 pursuant to notice issued under section 153A of the Act declared income of Rs . 12,50,791 /- including af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... return and everything would depend upon the IT return filed by the assessee . The assessee can furnish the particulars of income in his return and everything would depend upon the IT return filed by assessee . This view gets supported by explanations 4 as well as 5 and 5A of Section 271 . Obviously no penalty can be imposed unless the conditions stipulated in the said provisions are duly and unambiguously satisfied . Since the assessee was exposed during survey, may be, it would have not disclosed the income but for the said survey . However, there cannot be any penalty only on surmises, conjectures and possibilities . Section 271 ( 1 )( c ) has to be construed strictly . Unless it is found that there is actually a concealment or non - disclosure of particulars of income, penalty cannot he imposed . There is no such concealment or non - disclosure as the assessee had made a complete disclosure in the IT return and offered the surrendered amount for the purposes of tax . iii ) In CIT v . T . M . Abdul Hazeez CO . [ 2007J 293 ITR 384 ( Mad .) in response to the notice under section 148, the appellant filed the return o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shares carried out through the broker Shri S . S . Mehta enabled the Assessing Officer to hold the capital gain as bogus . The information from investigation wing that sale was bogus was not communicated to appellant when notice under s . 148 was issued . The return filed 'under section 148 was not filed after 'detection' . The return of income so filed was voluntary and had offered the additional income to buy peace of mind and to avoid litigation . In the aforesaid facts the Court held that during the course of assessment; the aforesaid explanation given by the appellant was neither rejected nor it was held to be mala fide . Further, the assessing authority had failed to take any objection that the declaration of income made by the appellant in his revised return and in his explanation were not bona fide . Therefore, in view of the aforesaid finding, the Court held that the Tribunal was justified in upholding the order of the Commissioner of Income tax ( Appeals ) , whereby the penalty imposed under section 271 ( l )( c ) of the Act by the Assessing Officer was ordered to be deleted . 5 . 4 Furthermore, levy of penal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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