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TMI Blog2016 (11) TMI 1609X X X X Extracts X X X X X X X X Extracts X X X X ..... penalty u/s. 271AAA on undisclosed income. Since, the orders of the Assessing Officer on penalty merged with the appellate authority, we are of the opinion that order of CIT(A) cannot be sustained and in the interest of justice, we dismiss the order of CIT(A) and allow the grounds of the assessee. - I.T.A. No. 985, 986, 1304, 1305/Mds/2013 / Assessment Year : 2008-09 - - - Dated:- 25-11-2016 - Shri Abraham P. George, And Shri G. Pavan Kumar, JJ. Appellant by: Shri G. Baskar, Advocate Respondent by: Mr. Supriya Pal, JCIT ORDER G. Pavan Kumar, These are the cross appeals filed by the assessee and Revenue against the orders of CIT(A) - II, Chennai in I.T.A. No. 34/2011-12/A-II dated 06.03.2013 for the assessment year 2008-09 in the case of Shri R. Rangarajan and I.T.A. No. 20/11-12/A-II dated 06.03.2013 of Smt. R. Mahalakshmi. Since, the issues in these appeals are common in nature, these appeal are clubbed and heard together and disposed by the common order. For the sake of convenience we first take up assessee's appeal ITA No. 985/Mds/2013. 2. The assessee has raised following grounds of appeal: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income has been unearth. The Ld. AR explained that the disclosed income pertains to the said financial year and the difference in the total income was already furnished and covered by the Explanation 5 of 271(1)(c) of the Act. The Ld. AO found in the assessment order that assessee has various real estate transactions and ₹ 12,75,000/- was added as undisclosed income in the hands of assessee as there is no convincing explanations on agriculture income. Finally, the Ld. AO is of the opinion that the assessee has not disclosed the said information in Return of Income u/s. 139(1) of the Act but disclosed in Return of income filed in compliance to the notice u/s. 153A of the Act and the assessee could not produce any books of accounts or substantiate the claim and the income was offered under income from other sources and levied the penalty of ₹ 48,35,016/- and passed order dated 27.06.2011. 4. Aggrieved by the order of penalty the assessee has filed an appeal with the CIT(A). In the appellant proceedings, the Ld. AR of the assessee argued that the Ld. AO erred in levying penalty as the assessee has offered ₹ 1,52,19,000/- in Return of income filed in complia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of section 271(1)(c) of the Act and due to mistake in stating the wrong section, the order cannot be said to be void and defect is curable u/s. 292B of the Act. Further, the Ld. CIT(A) is of the opinion that section 271AAA of the Act was introduced from 01.04.2007 applicable from Finance Act 2007 and as per the provisions where the search has been initiated u/s. 132 of the Act on or after 1st June 2007, the assessee shall be liable to pay by way of penalty in addition to tax, if any payable by him as computed at the rate of 10% of undisclosed income of the specified previous year and dealt exhaustively on the provisions at page 5 and 6 of the order and conclude that the provisions of section 271AAA of the Act are applicable to the assessee. The Ld. CIT(A) found that the undisclosed income offered by the assessee and addition in the assessment proceedings are liable for penalty u/s. 271AAA of the Act and directed the Assessing Officer to levy penalty @ 10% of such undisclosed income of the assessee and partly allowed the appeal. Aggrieved the assessee has filed an appeal with the Tribunal. 5. Before us, the Ld. AR of the assessee argued that the CIT(A) erred in giving di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e support our view on the decision of coordinate bench ITA No. 235 236 /Mds/2013 dated 30.04.2013 of Assistant Commissioner of Income Tax Vs. Smt J.Mythilli on applicability of provisions of levy of penalty. Now the question arises whether the order of the Ld. CIT(A) giving directions to the Assessing Officer to levy penalty u/s. 217AAA of the Act shall survive. We read the provisions of section 271AAA(1) of the Act as under: (a) The Assessing Officer may, notwithstanding anything contained in any other provisions of this Act, direct that in a case where search has been initiated u/s. 132 on or after the 1st day of June, 2007 [but before the 1st day of July, 2012], the assessee shall pay by way of penalty, in addition to tax, if any, payable by him, a sum computed at the rate of ten percent of the undisclosed income of the specified previous year . (b) Specified previous year means the previous year- (i) Which has ended before the date of search, but the date of filing the return of income under sub-section (1) of section 139 for such year has not expired before the date of search and the assessee has not furnished the return of income for the previ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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