9911796707
TMI Blog2019 (12) TMI 353X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee has furnished inaccurate particulars of income warranting levy of penalty under section 271(1)(c). Thus, the penalty levied u/s 271(1)(c) of the Act stands confirmed. Levy of penalty for assessee has not complied with the provisions of TDS in respect of the payments made in connection with land development - disallowance under section 40(a)(ia) - There was non-compliance of provisions of TDS in respect of land development expenses incurred by way of payments made to M/s. Bright Electricals of ₹.39,390/- and Shri S. Rajendran of ₹.25,450/- totalling to ₹.64,840/-, but not deducted TDS. Moreover, while filing return under section 153A of the Act, the assessee has failed to add the statutory disallowances applicable as per law, thereby the assessee has furnished inaccurate particulars warranting levy of penalty - we are of the considered opinion that the Assessing Officer has rightly levied penalty under section 271(1)(c) of the Act and the same stands confirmed. Negative cash balance - The fact of negative cash balance was revealed only during the course of search proceedings. During the course of assessment proceedings, the assessee submitted tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nalty levied under section 271(1)(c) of the Act on the undisclosed income of ₹.3,89,32,110/-. 4. Brief facts of the case are that the assessee is engaged in carrying on construction and real estate business. There was a search and seizure operation in the premises of the assessee on 10.01.2008. During the course of search, books of account and documents were found and seized. In response to the issue of notice under section 153A of the Act, the assessee filed return of income for the assessment year 2007-08 on 12.08.2009 admitting income of ₹.3,89,32,110/-. The assessment under section 153A r.w.s. 143(3) of the Act was completed by determining the total income at ₹.4,03,96,828/-. The Assessing Officer also initiated penalty proceedings under section 271(1)(c) of the Act on account of unaccounted cash, negative cash balance. After considering the submissions of the assessee during the course of penalty proceedings, the Assessing Officer levied penalty of ₹.1,35,97,572/- under section 271(1)(c) of the Act. On appeal, besides holding that the penalty is not leviable on the additions of ₹.64,840/-, ₹.2,99,878/- and ₹.11,00,000/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... admitting a total income of ₹.3,89,32,110/-. After considering the submissions of the assessee as well as seized materials/documents, the assessment under section 153A r.w.s. 143(3) of the Act was completed by determining the total income of the assessee at ₹.4,03,96,828/- after making various additions. Since the assessee has not preferred further appeal against the additions, the Assessing Officer initiated penalty under section 271(1)(c) of the Act and levied penalty on the assessed income of ₹.4,03,96,828/- at ₹.1,35,97,572/-. Against levy of penalty, the assessee preferred further appeal before the ld. CIT(A). After considering the submissions of the assessee, the ld. CIT(A) has observed that the search and seizure operation under section 132 of the Act was carried out on 10.01.2008, which was after 01.06.2007. It was further observed that the assessment year involved is 2007-08 and therefore, provisions of section 271AAA of the Act are attracted and not that of section 271(1)(c) of the Act consequent upon insertion of section 292B of the Act, whereby no return of income, assessment, notice, summons or other proceedings shall be rendered invalid merely ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e ground raised by the assessee to this extent is allowed. Similarly, the appeal of the Revenue also allowed. 8. The next ground raised in the appeal of the assessee relates to levy of penalty under section 271(1)(c) of the Act. Since the assessee has not preferred any appeal against the assessment order, the Assessing Officer initiated penalty proceedings under section 271(1)(c) of the Act on account of unaccounted cash payments and negative cash balance. 8.1 The assessee has claimed land development expenses to the tune of ₹.5,99,755/-, which was paid in cash. Since the assessee could not furnish cogent evidence and proper vouchers, after verification of the accounts, the Assessing Officer estimated and allowed 50% and balance 50% of the cash payment amounting to ₹.2,99,878/- was disallowed. Against the disallowance, the Assessing Officer initiated penalty proceedings under section 271(1)(c) of the Act. On appeal, the ld. CIT(A) held that no penalty can be levied under section 271(1)(c) of the Act besides holding that penalty under section 271AAA of the Act is warranted. 8.2 We have considered the rival contentions. S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in connection with land development. The assessee had no explanation to offer, the Assessing Officer made disallowance under section 40(a)(ia) of the Act. During the course of penalty proceedings, the Assessing Officer observed that even while filing the return of income under section 153A of the Act, the assessee should have added back himself the statutory disallowances applicable as per law. By not doing so, the assessee has furnished inaccurate particulars of income with the intention to conceal his total income, thereby warranting levy of penalty under section 271(1)(c) of the Act. Thus, the Assessing Officer levied penalty. 8.6 We have heard the rival submissions. There was non-compliance of provisions of TDS in respect of land development expenses incurred by way of payments made to M/s. Bright Electricals of ₹.39,390/- and Shri S. Rajendran of ₹.25,450/- totalling to ₹.64,840/-, but not deducted TDS. Moreover, while filing return under section 153A of the Act, the assessee has failed to add the statutory disallowances applicable as per law, thereby the assessee has furnished inaccurate particulars warranting levy of penal ..... 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