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TMI Blog2022 (6) TMI 563X X X X Extracts X X X X X X X X Extracts X X X X ..... ecorded under section 132(4) of the Act, specifying the manner in which such income has been derived and if the assessee pays the tax along with interest of such income. In the facts of the present case, undisputedly, the assessee has offered the cash found as income in the statement recorded under section 132(4) of the Act. It is also a fact that the assessee has paid the tax on such income. The only condition, according to the department, which has not been fulfilled is the assessee has not specified the manner in which such income has been derived. On a perusal of the statement recorded under section 132(4) of the Act, we have observed that in response to a question asked by the authority concerned, the assessee came forward to offer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the appeals relating to three assessment years, however, presently, we are concerned with assessment year 2012-13. 3. Briefly the facts are, the assessee, since deceased, was a resident individual. For the assessment year under dispute, the assessee had filed his return of income on 28.07.2012 declaring income of Rs.9,87,75,340/-. It is relevant to observe, on 09.11.2011, a search and seizure operation under section 132 of the Act was conducted on the assessee, wherein, information was found that the assessee was operating a foreign bank account at HSBC Geneva. Further, in course of search and seizure operation, various incriminating materials were found and seized. Out of cash found of Rs.11,82,500/-, an amount of Rs.11,50,000/- wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Tribunal, deleted the penalty imposed under section 271AAA of the Act in respect of the additions made of Rs.1,12,89,646/- representing unexplained jewellery. However, insofar as the addition of Rs.11,82,500/- on account of cash found in course of search, learned Commissioner (Appeals) confirmed the penalty imposed with the observation that the manner in which cash was derived was not specified by the assessee. Accordingly, he held that the assessee was unable to satisfy all the criteria laid down in section 271AAA of the Act. 5. Drawing out attention to the statement recorded under section 132(4) of the Act from the assessee on the date of search operation, learned counsel for the assessee submitted, the assessee has clearly and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ard to the manner in which undisclosed income was derived, penalty under section 271AAA cannot be levied. He submitted, penalty under section 271AAA of the Act is not mandatory. Therefore, if the assessee offers a reasonable explanation, no penalty can be imposed. Further, he submitted, once the department accepts the voluntary disclosure of income made by the assessee, no penalty under section 271AAA can be imposed. In support of his contention, learned counsel for the assessee relied upon a number of judicial precedents as referred to in the written submission filed before us. 6. Strongly relying upon the observations of learned Commissioner (Appeals), learned Departmental Representative submitted, the assessee had full opportunity t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r section 271AAA is cash found of Rs.11,82,500/-. The question which arises for consideration is, whether penalty under section 271AAA can be imposed when the assessee has offered the amount as undisclosed income in course of search and seizure operation. For better appreciation, it is necessary to have a look at the provision contained under subsection (2) of section 271AAA of the Act, which reads as under: Penalty where search has been initiated. 271AAA. (1) .. (2) Nothing contained in sub-section (1) shall apply if the assessee,- (i) in the course of the search, in a statement under sub-section (4) of section 132, admits the undisclosed income and specifies the manner in which such income has been de ..... X X X X Extracts X X X X X X X X Extracts X X X X
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