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TMI Blog2018 (2) TMI 1341X X X X Extracts X X X X X X X X Extracts X X X X ..... ehalf of assessee and Shri A.K. Tiwari, Ld. Departmental Representative appeared on behalf of Revenue. 2. Solitary issue raised by assessee in this appeal is that Ld. CIT(A) erred in confirming the penalty levied by Assessing Officer u/s 271AAA of the Act for Rs. 1 lakh. 3. Briefly, the facts of the present case the assessee is an individual and deriving his income from salary and other source of income. A search was conducted u/s. 132 of the Act on 27.01.2011 and 28.01.2011 in case of Warren Tea Group, the assessee was one of the Director of Warren Tea Ltd. Therefore, he was also searched u/s 132 of the Act. The assessee in his statement recorded u/s 132(4) of the Act has declared an undisclosed income of Rs. 10, lakh only. The break-up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disclosed income declared in the statement furnished u/s 132(4) of the Act. 4. Aggrieved, assessee preferred an appeal before Ld. CIT. The assessee before Ld. CIT(A) submitted that search was conducted on 27.01.2011 whereas the due date for filing return income for the year under consideration was not expired. The undisclosed income was duly offered to tax before filing the income tax return as specified u/s 139(1) of the Act. During search proceedings, no detection of concealed income was found by the Revenue. Therefore, there was no concealed income declared by assessee 4.1 The amount seized by search team for Rs.2,35,600/- was claimed as prepaid tax in the income tax returns and the balance amount of tax duly paid as self-assessment ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arch the appellant specified the manner in which such income was derived and also did not substantiates the manner in which the undisclosed income was derived. He simply admitted the undisclosed income of Rs. 10 lakhs which was applied in certain portion of jewellery found in the course of search as well as the cash. Even if, on the basis of seized cash lying with the department and as claimed in the return of income. It is presumed that the appellant has paid the tax on the undisclosed income but the conditions as mentioned u/s.271AAA(2)(i) and 271AAA(2)(ii) were not satisfied. Under the circumstances, I am of the opinion that the AO was justified in imposing the penalty u/s. 271AAA of the Act amounting to Rs. 1 lakh. The penalty so impose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 derived; (ii) substantiates the manner in which the undisclosed income was derived; and (iii) pays the tax, together with interest, if any, in respect of the undisclosed income. As per the order of Ld. CIT(A) the assessee failed to substantiate manner by which the undisclosed income was earned by him. Therefore, penalty u/s. 271AA of the Act was levied. However, we note that Hon'ble ITAT in the case of DCIT vs. Pioneer Marbles & Interiors Pvt. Ltd. reported 144 TTJ 663 has held as under:- "on the facts of the instant case wherein entire tax and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owed by filing of the return under section 153A. it is also pertinent to note that this offer has been voluntarily made by the assessee without any incriminating materials found during the course of search. Hence, it goes to prove beyond doubt that the offer of undisclosed income of Rs. 2 crores was made voluntarily by the assessee without any detection by the department and, accordingly, the argument of the departmental representative that but for the search, this income would not have been offered does not hold any water and deserves to be dismissed. Thus, the assessee is entitled for immunity from levy of penalty under section 271AAA(2) and, accordingly, the penalty levied by the Assessing Officer is cancelled." From the above order, w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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