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TMI Blog2021 (8) TMI 320X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee. Accordingly, we quash the revision order passed by the learned Principal Commissioner of Income-tax. - Decided in favour of assesee. - I. T. A. No. 1809/Bang/2018 - - - Dated:- 19-4-2021 - B. R. Baskaran (Accountant Member) And Smt. Beena Pillai (Judicial Member) For the Assessee : R. E. Balasubmramanyam , Chartered Accountant For the Department : Muzaffar Hussain , Joint Commissioner of Income-tax (Departmental representative) ORDER SMT. BEENA PILLAI (JUDICIAL MEMBER). - 1. The present appeal has been filed by the assessee against the order dated January 23, 2018 passed by the learned Principal Commissioner of Income-tax under section 263 of the Act, for the assessment year 2014-15 on the following grounds of appeal : The appellant objects to the order of revision of the learned Principal Commissioner of Income-tax on the grounds that, (1) The impugned order is opposed to the law and facts of the case in so far it is prejudicial to the interests of the appellant. (2) The impugned order of revision is invalid and unwarranted in as much as the Assessing Officer had dropped the penalty proceedings after due application of mind and the lea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly the application dated June 2, 2018 stands allowed. 4. Brief facts of the case are as under : A search and seizure operation was conducted in case of M/s. Shobha Developers Ltd. on October 10, 2013. At the time of scrutiny proceedings by the Assessing Officer in case of M/s Shobha Developers, the learned Assessing Officer found that seized folder and exist in A/DSP/03 does not belong or pertain to M/s. Shobha Developers but to the present assessee. It was observed that the folder contained bills/vouchers of jewellery purchased in the name of the assessee. A statement was recorded under section 132(4) on October 10, 2013 wherein the assessee confirmed that the jewellery was found from its residents and it belonged to the assessee. The learned Assessing Officer of M/s. Shobha Developers was satisfied that those documents have a bearing on the determination of total income of the assessee and hence the materials were handed over to the Assessing Officer having jurisdiction over the assessee. 5. After going through the seized material the learned Assessing Officer in case of the assessee was satisfied that the documents have a bearing on the determination of total income of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s a mere revision of proceedings which cannot be invoked. It was also submitted that the penalty under section 271AAB is not automatic as it could be initiated only in case of searched person. 10. The learned Principal Commissioner of Income-tax however held that the learned Assessing Officer dropped the penalty proceedings in a mechanical manner without any application of mind. He accordingly set aside the penalty proceedings under section 271AAB for the assessment year 2014-15 to the learned Assessing Officer with a direction to pass the penalty order under section 271AAB after duly considering the observations made by the learned Principal Commissioner of Income-tax in the order passed under section 263 of the Act, and after allowing the assessee adequate opportunity of being heard to make relevant submissions. 11. Aggrieved by the order of the learned Principal Commissioner of Income-tax, the assessee is in appeal before us now. 12. In the present appeal the issue that requires adjudication is as to whether the learned Principal Commissioner of Income-tax was justified in holding that penalty proceedings dropped by the learned Assessing Officer under section 271AAB of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 271AAB is integrally connected to search under section 132 of the Act. In the absence of search under section 132 of the Act, the assessee has no occasion to avail of the concessional treatment by way of admission under section 132(4) of the Act. Thus, we find obvious merits in the observations made by the first appellate authority that provisions of section 271AAB of the Act are not applicable to the case of the assessee. In the absence of search under section 132 of the Act, the consequential or incidental assessment proceedings under section 153C of the Act will not, in our view, entitle the Assessing Officer to usurp jurisdiction under section 271AAB of the Act for the purposes of imposition of penalty. Hence, we do not see any infirmity in the conclusion drawn by the Commissioner of Income-tax (Appeals).' 11. The Pune Bench of the Tribunal in the case of Volga Dresses (supra) has also taken a similar view : '6. We have considered the rival submissions. A perusal of the provisions of section 271AAB shows that the opening words are penalty where search has been initiated a perusal of the provisions under section 271AAB also talks of the assessee declaring a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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