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TMI Blog2018 (2) TMI 57X X X X Extracts X X X X X X X X Extracts X X X X ..... the undisclosed income”. Thus, the language employed in both the sections is similar. Therefore, the Tribunal as well as the Commissioner (Appeals) were wholly justified in applying the principles enunciated by this High Court in Commissioner of Income Tax v. Mahendra C. Shah (2008 (2) TMI 32 - GUJARAT HIGH COURT) while interpreting the provisions of sub-section (2) of section 271AAA of the Act. Accordingly, the assessee has also satisfied the third condition laid down under sub-section (2) of section 271AAA of the Act. The Tribunal was, therefore, wholly justified in upholding the deletion of penalty under section 271AAA of the Act. - Decided in favour of assessee. - Tax Appeal No. 826 of 2017 - - - Dated:- 22-1-2018 - Ms. HARSHA DEV ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esidential premises of the assessee. During the course of search, a statement of one of the partners of the firm, namely, Shri Alpeshbhai G. Kotadia came to be recorded on 20.1.2011 under section 132(4) of the Act, wherein he had admitted ₹ 15 crore as undisclosed income on oath. A notice under section 142(1) of the Act was issued to the assessee, in response to which, the assessee furnished return of income on 29.9.2011 declaring total income of ₹ 17,11,33,110/- for the year under consideration. The Assessing Officer observed that during the course of assessment, the assessee was asked to substantiate the income of ₹ 15 crore offered by it, which was admitted as undisclosed income in the statement of Shri Alpeshbhai G. Ko ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of search action under section 132 of the Act, a statement of Shri Alpeshbhai Kotadia, partner of the assessee firm was recorded under section 132(4) of the Act, wherein he admitted that the pages of diary BS-1 found and seized, contained entries of taxable income of ₹ 15 crore relating to various firms which were not recorded in the books of accounts. Out of ₹ 15 crore, an amount of ₹ 8.10 crore was disclosed in the case of the assessee firm. It had also been admitted by Shri Kotadia that the pages of the diary which was found and seized, contained entries of net taxable income which had not been recorded in the books of accounts, and hence, the said unaccounted income was offered for taxation. It was further the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is of which was a diary found and seized during the course of search. The diary contained the entries of the unaccounted/undisclosed income of ₹ 8.10 crore belonging to the assessee firm which had been explained by Shri Kotadia while recording his statement. Such undisclosed income has been accepted by the Assessing Officer in the assessment proceedings and hence, the Commissioner (Appeals) was of the view that the second condition also stands satisfied. 6. As regards the third condition as envisaged in clause (iii) of sub-section (2) of section 271AAA of the Act, the Commissioner (Appeals) has noted that the tax together with interest if any, in respect of undisclosed income should be paid by the assessee for getting immunity from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal have recorded concurrent findings of fact that Shri Kotadia, during the course of recording of his statement at the time of the search, had stated that the income was earned by accepting on-money in its building project. Therefore, the manner in which the income had been derived has been clearly specified in the statement made by Shri Kotadia. Insofar as substantiating the manner in which the undisclosed income was derived is concerned, the Tribunal has recorded that it had been pointed out that the undisclosed income was received by the assessee as on-money. It is not the case of the appellant that during the course of recording of the statement of Shri Kotadia any specific questions had been asked to substantiate the manner in whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, then, not withstanding that such income is declared by him in any return of income furnished on or after the date of the search, he shall, for the purposes of imposition of penalty under clause (c ) of sub-section (1) of that section, be deemed to have concealed the particulars of his income or furnished inaccurate particulars of such income. The Explanation further provides for two exceptions to such deeming of concealment of particulars and furnishing of inaccurate particular. The second exception, inter alia provides that if the assessee pays the tax, together with interest if any, in respect to such income , he shall be entitled to be excepted from the rigours of the Explanation. 11. A conjoint reading of the provisions of clause ..... X X X X Extracts X X X X X X X X Extracts X X X X
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