9911796707
TMI Blog2018 (3) TMI 217X X X X Extracts X X X X X X X X Extracts X X X X ..... from infirmity. Accordingly, the same is cancelled. The Assessing Officer is directed to delete the penalty levied under section 271(1)(c) of the Act. - Decided in favour of assessee partly. X X X X Extracts X X X X X X X X Extracts X X X X ..... Briefly, in the facts of the case, the assessee had filed return of income declaring total income of ₹ 1,08,900/- on 20.11.2006. Search action under section 132 of the Act was conducted in the case of Dr. Uday Salunke, Director, Prin. L.N. Welingkar Institute of Management Development & Research (LNWIM), Matunga, Mumbai and other connected assessee on 20.11.2010. Since the warrant of authorization was also issued in the case of assessee, notice under section 153A of the Act was issued. In response thereto, the assessee filed return of income on 21.09.2012 declaring total income at ₹ 4,65,638/-. Thereafter, case of assessee was picked up for scrutiny and various information and details were called for. The Assessing Officer noted that the assessee had earlier on 30.03.2010 submitted return of income declaring income of ₹ 4,63,707/- which was submitted in response to notice under section 153A of the Act. The said notice was issued consequent to previous search action in the case on 21.07.2008. Further proceedings were initiated in view of subsequent search action on 20.11.2010. The Assessing Officer noted that in the original return of income, the assessee had only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t and has relied on the ratio laid down by the Hon'ble High Court of Delhi in Pr.CIT Vs. Neeraj Jindal reported in 393 ITR 1 (Delhi) and also placed reliance on the decisions of Hon'ble Supreme Court in T Ashok Pai Vs. CIT (2007) 292 ITR 11 (SC), CIT Vs. Reliance Petroproducts Pvt. Ltd. (2010) 322 ITR 158 (SC) and Price Waterhouse Coopers Pvt. Ltd. Vs. CIT & Anr. (2012) 348 ITR 306 (SC). The written submissions filed by the assessee are placed in Paper Book. 8. The learned Departmental Representative for the Revenue on the other hand, pointed out that the issue raised by assessee in written submissions is covered against the assessee by the judgment of Hon'ble Supreme Court in Prasanna Dugar Vs. CIT (2016) 70 taxmann.com 175 (SC), which has upheld the decision of the Hon'ble High Court of Calcutta in CIT Vs. Prasanna Dugar (2015) 371 ITR 19 (Cal.). 9. The second issue which was raised before us was the jurisdictional issue by way of ground of appeal No.1, for which the assessee has not filed any written submissions, is, that the Assessing Officer had failed to record satisfaction on one of the limbs of section 271(1)(c) of the Act while initiating penalty for concealment. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mstances, even if the additional income is added in the hands of assessee, the assessee is not liable for penalty under section 271(1)(c) of the Act. In this regard, reliance was placed on various decisions as referred above. However, the issue now stands settled by the Hon'ble Supreme Court in Prasanna Dugar Vs. CIT (supra). The Hon'ble High Court of Calcutta while deciding the case of levy of penalty under section 271(1)(c) of the Act on identical situation as before us, has upheld the said levy of penalty. In the facts before the Hon'ble High Court of Calcutta, search under section 132 of the Act was conducted at the premises of assessee on 03.02.2009. During the course of search, the assessee made voluntary disclosure under section 132(4) of the Act disclosing sum of ₹ 6 crores even though no incriminating documents suggesting any such undisclosed income were found. No concealed income was established from any of the papers or documents found during the course of search. The entire disclosure was made voluntarily and in good faith. On the basis of said disclosure, the assessee filed the return of income offering sum of ₹ 70,000/- for taxation during assessment y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer accepts the revised return filed under section 153A of the Act, the original return under section 139 of the Act abates and become non-est. The Hon'ble High Court held that it is trite to say that concealment had to be seen with reference to the return that is filed by the assessee i.e. the one under section 153A of the Act and deleted penalty levied under section 271(1)(c) of the Act. However, in view of the ratio laid down by the Hon'ble Supreme Court in Prasanna Dugar Vs. CIT (supra), we hold that the issue stands covered against the assessee on this ground. 13. Now, coming to the jurisdictional issue which is raised by way of ground of appeal No.1. Though the assessee has raised the issue but no written submissions have been filed. However, propriety demands that the issue be decided in accordance with law. The perusal of assessment order reflects that while recording satisfaction for initiating penalty proceedings under section 271(1)(c) of the Act, the Assessing Officer has observed that it is the case of concealing income and furnishing of inaccurate particulars of income. In other words, the Assessing Officer while recording satisfaction for initiating penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed was ₹ 1.56 crores. However, the Assessing Officer adopted the returned income as total income assessed in the hands of assessee and 11. In the facts of the present case, consequent to Survey action conducted on the premises of assessee, the assessee filed return of income declaring total income of ₹ 1,24,20,250/-. The said returned income was accepted as such by the Assessing Officer. However, addition of ₹ 32,09,950/- was made on protective basis in the hands of assessee. The Assessing Officer has dealt with the protective addition in first part of para 4 and no satisfaction has been recorded for initiating penalty proceedings against the same. However, in respect of returned income filed by the assessee declaring total income of ₹ 1,24,20,250/-, the Assessing Officer observed that the said transaction in respect of property was required to be disclosed by the assessee in the year under consideration but the assessee failed to do the same and even did not pay any advance tax. Hence, penalty proceedings under section 271(1)(c) of the Act were initiated for concealing particulars of income of ₹ 1,24,20,250/-. Thereafter, directions were given to issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the plea of learned Departmental Representative for the Revenue in this regard, wherein the returned income was finally accepted by the CIT(A) / Tribunal and the protective addition made in the hands of assessee was deleted. Accordingly, we hold that penalty order passed in the case suffers from infirmity and the same is invalid in law. Accordingly, we direct the Assessing Officer to delete said penalty under section 271(1)(c) of the Act at ₹ 11,74,601/-." 16. Applying the parity of above decision to the facts of present case, where penalty proceedings have been initiated on both the limbs of section 271(1)(c) of the Act and the Assessing Officer having failed to record satisfaction in respect of one of the limbs of section 271(1)(c) of the Act and the penalty having been levied for concealment or furnishing of inaccurate particulars of income i.e. without coming to a finding as to which limb has not been fulfilled by the assessee, then penalty order passed in the case suffers from infirmity. Accordingly, the same is cancelled. The Assessing Officer is directed to delete the penalty levied under section 271(1)(c) of the Act. The grounds of appeal raised by the assessee are ..... X X X X Extracts X X X X X X X X Extracts X X X X
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