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TMI Blog2019 (5) TMI 1262X X X X Extracts X X X X X X X X Extracts X X X X ..... Kedia, Accountant Member For the Assessees : Shri Mehul J. Ranpura, AR For the Revenue : Shri B.B. Rajendra Prasad, CIT-DR ORDER PER SHRI PRADIP KUMAR KEDIA, AM: This bunch of captioned four appeals have been filed at the instance of the different assessees against the separate appellate orders of the Commissioner of Income Tax(Appeals)-11, Ahmedabad [CIT(A) in short] dated 01/02/2017, 08/09/2017, 20/07/2017 arising in the assessment orders passed under s.143(3) of the Income Tax Act, 1961 (hereinafter referred to as the Act ) dated 28/02/2015 24/03/2015 relevant to Assessment Year (AY) 2013-14. 2. In all the captioned 4 cases, the only issue agitated before the Tribunal is towards levy of penalty under s.271AAB of the Act by the Assessing Officer which was confirmed by the CIT(A)-11, Ahmedabad. 3. As all the appeals concerning the group cases involving the identical issue, all the matters were heard together and disposed of by this common order. 4. Briefly stated, a search action under s.132 of the Act was carried out at the premises of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e statement recorded under section 132(4) of the Act, admitted additional income on ad-hoc basis for the family group concerns as a whole. Out of the voluntarily declarations of additional income, the assessee included ₹ 2,54,13,250/- on ad-hoc basis in his return of income. The income declared by the assessee hi the return of income was accepted in toto without any modification. The Ld. A.R pointed out from the penalty order that the declarations were made and honoured subsequently in the return of income filed only to avoid long drawn litigations and to buy peace of mind. The Ld. A.R vehemently reiterated its submission made before the AO that nothing incriminating hi the form of cash, gold, valuables or any documents .or data evidencing the undisclosed income was found. The Ld. A.R therefore contended that a declaration made on ad-hoc, basis to cover up defects or discrepancies in the books of account, if any, without any detection of falsity cannot be equated with the 'undisclosed income' as statutorily defined unite section 271AAB of the Act. To support its contention, the Ld, A.R submitted that for the purposes of penalty, the AO has merely relied upon some ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... low and material placed on record. The core controversy involved in the present appeal is towards maintainability of imposition of penalty under section 271AAB hi the facts and circumstances of the case. 11.1 It is the case of the assessee that the income declared in. the return of income arises out of regular stream of income from various sources and ad-hoc declaration combinedly made for group concern and included in the return of income towards its share, does not tantamount to undisclosed income as codified in the Explanation-(c) below section 271AABoftheAct. 11.2 To paddle its point of view, the assessee has strongly relied on the statutory definition of undisclosed income . We find that identical issue came up for consideration in the case of Jasubhai Arjanbhai Vaghasia vs. ACIT, ITA No. 58/Rjt/2017 order dated 17.05,2018 in the context of section 271AAA of the Act. Therefore, it is considered expedient to reproduce the relevant operative para of the decision of the Co-ordinate Bench on the issue:- 8. We have carefully considered the rival submissions and perused the orders of the authorities below and material placed on r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (i) any income of the specified previous year represented, either wholly or partly, by any money, bullion, jewellery or other valuable article or thing or any entry in the books of account or other documents or transactions found in the course of a search under section 132, which has- (A) not been recorded on or before the date of search in the books of account or other documents maintained in the normal course relating to such previous year; or (B) otherwise not been disclosed to the Chief Commissioner or Commissioner, before the date of the search; or (ii) any income of the specified previous year represented, either wholly or partly, by any entry in respect of an expense recorded in the books of account or other documents maintained in the normal course relating to the specified previous year which is found to be false and would not have been found to be so had the search not been conducted; (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 (!) of section 139 for such yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thus not permissible. 10. In view of the aforesaid discussion, we do not consider it necessary to advert to the alternative plea of the assessee for imposition of penalty with reference to ad-hoc amount of declaration alone. 11. The order of the Assessing Officer towards imposition of penalty under section 271AAA is therefore set aside and the Assessing Officer is directed to delete the penalty so imposed. 12. In the result appeal of the assesses is allowed. 11.3 As noted above, the Co-ordinate Bench has dealt with identical issue and held that in the absence of any reference to tangible material, mere act of acquiesce of ad-hoc income under section 132(4) of the Act. cannot be covered within the sweep of undisclosed income for the purposes of imposition of penalty under section 271AAA of the Act. In the present case, the penalty has been imposed in terms of the amended provision for imposition of penalty under section 271AAB of the Act. However, the definition of undisclosed income under erstwhile section 271AAA and section 271AAB are identical. Therefore, the plea of the assessee that in the absence of refere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision rendered in the group cases in identical set of facts, we are disposed to hold in favour of the assessee. The appellate order passed by the CIT(A) is accordingly set aside and the Assessing Officer is directed to delete the penalty amounting to ₹ 26,11,325/- so imposed u/s.271AAB of the Act. 10. In the result, appeal of the assessee in the case of Shri Bharatbhai T.Aghara in IT(ss) A No.88/Rjt/2017 for AY 2013-14 is allowed. 11. We shall now advert to other captioned appeals in ITA No.159/Rjt/2017, IT(ss)A Nos.159/Rjt/2017 89/Rjt/2017 involving identical issue. In the absence of any change in facts pointed out in the course of hearing by either side, our view in IT(ss)A No.88/Rjt/2017 for AY 2013-14(supra) shall apply mutatis mutandis . Thus, the grievance towards imposition of penalty on merits is adjudicated in favour of the assessee. Hence, the levy of penalty of ₹ 1,87,500/- u/s.271AAB in ITA No.159/Rjt/2017, ₹ 1,50,000/- in IT(ss)A No.159/Rjt/2017 and ₹ 2,90,200/- in IT(ss)A No.89/Rjt/2017 stands deleted. 11. In the combined result, all the four captioned appeals are allowed. This ..... X X X X Extracts X X X X X X X X Extracts X X X X
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