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TMI Blog2018 (5) TMI 1103X X X X Extracts X X X X X X X X Extracts X X X X ..... d disclosed undisclosed income in the return filed after the search he did not disclose the manner of deriving the undisclosed income hence does not qualify for any immunity in terms of section 271AAA(2). The AO was fully justified in levying the penalty under section 271AAA - We agree with the contention of the appellant that undisclosed income would be only the value of undisclosed investment of ₹ 6,10,000/- found during the search and not ₹ 6,25,000/- offered by the appellant. Accordingly, amount of penalty u/s.271AAA being 10% of undisclosed income of ₹ 6,10,000/- would be ₹ 61,000/-. Penalty levied u/s.271AAA to the extent of ₹ 61,000/- is upheld on account of concealing the particulars of income. Ground r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... action u/s.132 of the Act in the Ashoka group of cases on 20-04-2010 wherein the assessee was also covered. Assessee filed the return of income on 30-10-2006 showing total income of ₹ 30,24,290/- and agricultural income of ₹ 53,250/-. Further, in response to notice u/s.153A of the Act, assessee filed the return of income on 17-10-2011 declaring total income of ₹ 30,99,290 and agricultural income of ₹ 53,250/-. Search resulted in disclosure of additional income of ₹ 75,000/-. Further, assessee could not explain the discrepancies in cash balances as per books and as per the seized papers. Therefore, the difference amount of ₹ 3,231/- was added by the AO to the income as income from undisclosed sources. Even ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said section. Further, bringing our attention to Para No.4 of the penalty order dt 30-09-2013, Ld. Counsel for the assessee submitted that penalty is levied for concealing the particulars of his income to the tune of ₹ 78,231/- by furnishing inaccurate particulars in respect of the same . Therefore, Ld. Counsel for the assessee submitted that the penalty proceedings are done in a casual manner. He further submitted that initiating the penalty proceedings without specifying a particular limb and levying the penalty on both the limbs of clause (c) is bad in law and unsustainable. To this proposition, he relied on the decision of Hon ble jurisdictional High Court in the case of CIT Vs. Shri Samson Perinchery dated 05-01-2017 as well as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g inaccurate particulars . Therefore, it is a case where the AO did not have clarity of thought and AO suffered from ambiguity in his mind with regard to the applicable limb of clause (c) of section 271(1) of the Act to the facts of the case. Therefore, we find the penalty order of the AO falls short of legal requirement on the issue of recording of satisfaction. Initiation of penalty proceedings under the provisions of section 271(1)(c) of the Act and levying the penalty on both the limbs of clause (c) of said section is unsustainable in law legally. This view was already taken by the Pune Bench in a series of cases. The manner of initiating and levying of penalty without making reference to the specific limb of clause (c) is unsustained. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 6,25,000/- was found. During the proceedings, assessee contested that the said jewellery constitutes gifts received at the time of his daughter s marriage and on various occasions. As per the assessee, the same is not unaccounted investment of the assessee. However, the AO held that the assessee failed to satisfy the conditions specified in the provisions of section 271AAA of the Act. On finding that relevant entries are not made in the books of account, AO made addition of the same in the assessment. On considering the fact that assessee failed to explain the manner of accounting of income that led to the investment in the excess jewellery of ₹ 6,25,000/-. Eventually, AO proceeded to levy penalty under the said provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ). 15. We heard both the sides and perused the orders of the Revenue on this issue of excess jewellery found during the search action amounting to ₹ 6,25,000/-. On perusing the conclusion of CIT(A) given in Para No.3.4 of his order, we find it relevant to extract the same for the sake of completeness: 3.4 In view of the above definitions, undisclosed investment in jewellery of ₹ 6,10,000/- was found during the course of search which was not found recorded in the regular books of accounts qualifies as Undisclosed Income . The previous year involved being the year of search hence qualifies as Specified Previous Year . Although the appellant had disclosed undisclosed income in the return filed after the search he did not d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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