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TMI Blog2021 (9) TMI 213X X X X Extracts X X X X X X X X Extracts X X X X ..... the computation of income. AO was not justified in invoking the penalty proceeding for concealment of income or furnishing inaccurate particulars of income for the reason that there was no disallowance/ addition to the total income of the assessee during the assessment proceedings. The presumption of the AO that the assessee would not have disclosed the income in return in future is mere a suspicion having no any base. - Decided against revenue. - ITA No. 2096/AHD/2018 (Asstt. Year: 2014-2015) - - - Dated:- 2-3-2021 - SHRI MAHAVIR PRASAD, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER Revenue by: Shri Virendra Ojha, C.I.T.D.R Assessee by: Shri Vartik Chokshi with Shri Biren Shah, A.Rs ORDER PER WASEEM AHME ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oncealment of income or furnishing inaccurate particulars of income does not arise. As such, to invoke the provision of section 271(1)(c) the AO must satisfy himself during any proceeding under this Act that income was concealed or inaccurate particular has been furnished. 3.2 However, the AO rejected the explanation and contention advanced by the assessee and held that the undisclosed income of ₹ 10 Crore was only offered after the same was detected during the course of survey operation. If survey would not have been carried out then the assessee would not have offered the impugned income. The AO further held that in view of Hon ble Supreme Court judgment in case of Dharmendra Textile Processors for levying penalty means-rea need ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were not prepared and even financial year has not ended. The reason for imposing penalty is nothing but a conjecture. The AO has not disputed the fact that amount owned up as undisclosed income was duly shown in return of income. Thus there is neither a case of concealment of particulars income nor a case of furnishing inaccurate particulars of income. It is observed that Explanation 1 to section 271(l)(c) of the Act may be applicable only when there is variation in returned income and assessed income meaning thereby that penalty may lie when AO has made addition or disallowance in assessment order which is not the case here. Even Explanation 4 to section 271(l)(c) of the Act stipulates that penalty may leviable on difference between assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he may direct that such person shall pay by way of penalty,- (i) XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX 92 [* * *] 93 [(ii) XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX 96 [(iii) in the cases referred to in clause (c) 97 [or clause (d)], 98 [in addition to tax, if any, payable] by him, a sum which shall not be less than, but which shall not exceed 99 [three times], the amount of tax sought to be evaded by reason of the concealment of particulars of his income 1 [or fringe benefits] or the furnishing of inaccurate particulars of such income 1 [or fringe benefits]. 2 [* * *] 3 [Explanation 1.-Where in respect of any facts material to the computation of the total income of any person under this Act,- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... result thereof shall, for the purposes of clause (c) of this sub-section, be deemed to represent the income in respect of which particulars have been concealed. 7.2 Now in view of the above discussion we proceed to adjudicate the issue on hand in the given facts and circumstances. We find that when the survey proceeding dated 25-0302014 was conducted at the assessee premises the financial year was not ended and also there was plenty of time for filing the return of income under the provision of section 139(1) of the Act. Subsequently the assessee incorporated the amount of income which was admitted during survey in the computation of income. Further the AO also accepted the returned income while finalizing assessment proceeding under se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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