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TMI Blog2019 (3) TMI 494X X X X Extracts X X X X X X X X Extracts X X X X ..... nding declaration at the time of search. Thus, qua this amount, immunity available under sub-clause (2) of section 271AAA is not available. The ld.CIT(A) has erred in deleting penalty qua this undisclosed income. Therefore, we partly allow the appeal of the Revenue and restore penalty qua addition of ₹ 54.50 lakhs and ₹ 12.50 lakhs. There will not be any penalty to the extent of undisclosed income admitted at ₹ 3.13 crores and penalty at the rate of 10% for the balance undisclosed income of ₹ 67.00 lakhs out of ₹ 3.80 crores would be calculated and levied i.e. (Rs.3.80 crores minus ₹ 3.13 crores). We partly allow the ground of appeal of the Revenue. - IT(SS)A No.65/Ahd/2016 - - - Dated:- 7-3-2019 - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted during the course of search. The AO was of the opinion that the assessee failed to disclose the manner and substantiate the manner, how this income was earned. On appeal, the ld.CIT(A) has deleted penalty by observing that during the course of search, the assessee has explained manner in which the income was derived and also substantiated the manner in which income was disclosed. Accordingly, the ld.CIT(A) deleted the penalty. 4. Before us, the ld.DR contended that though it is not discernible, whether a question was put to declarant during the course of search about the manner in which undisclosed income was derived, but during the course of assessment proceedings, the ld.AO did ask the question. The assessee failed to disclose th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion (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. (3) No penalty under the provisions of clause (c) of subsection (1) of section 271 shall be imposed upon the assessee in respect of the undisclosed income referred to in sub-section (1). 6. A bare perusal of this section would indicate that subsection (1) authorise the AO to levy penalty at the rate of 10% of the undisclosed income of the specified previous year. Sub-section (2) provides conditions on whose fulfillment the assessee cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t detailed bifurcation will be given within seven days. However, bifurcation has been given in his statement recorded under section 131 on 20.4.2012. Relevant part of this statement reads as under: A.I My name is Sunil Prahaladbhai Sewani, age 34 yrs, residing at 45, Ashwamegh part-Ill, Satellite, Ahmedabad. Q.2 You are asked to give person wise and year wise bifurcation in respect of cash payments totaling to ₹ 10.13 Crore paid by you as revealed from page no. 31 of the seized Annexure A-l which has been admitted by you in your statement u/s. 132 (4) of the Act dated 21.12.2011. In regard you are also asked to explain the sources of the cash and also complete names an addresses and PAN of the persons, purpose for which the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Total 13,00,00,000 The source of the cash paid for investment in land is income earned from various business activities during the F.Y. 2011-12. The purpose for making the payments was advance paid for reserving land. The address of the persons to whom cash was paid is riot known to me as the cash was paid to representatives of various brokers. The payments were made for scouting various lands in and round Ahmedabad and Gujarat and those were not made for any specific land as it was only advance payments made to scouting and reserve the land. But finally none of the lands has actually been finalized some of the money has also been received back. Copy of the stateme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tent of ₹ 3.13 crores income was declared during the course of search by Shri Sunil P. Sewani on behalf of the assessee. This has been returned by the assessee. However, with regard to the remaining part i.e. ₹ 54.50 lakhs on account of jewellery and ₹ 12.50 lakhs on account of other discprenacy admitted in the return, there is no corresponding declaration at the time of search. Thus, qua this amount, immunity available under sub-clause (2) of section 271AAA is not available. The ld.CIT(A) has erred in deleting penalty qua this undisclosed income. Therefore, we partly allow the appeal of the Revenue and restore penalty qua addition of ₹ 54.50 lakhs and ₹ 12.50 lakhs. In other words, there will not be any pen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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