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TMI Blog2023 (7) TMI 894X X X X Extracts X X X X X X X X Extracts X X X X ..... why a penalty u/s 271AAB should not be imposed clearly concluded intimating the consideration of representation before concluding proceedings imposing penalty u/s 271AAB of the Act, as it ostensible from the reproduced text of SCN laid at para 8 hereinbefore. ii) Secondly, the sub-section (2) of section 271AAB intractably expunges the levy of penalty u/s 270A and 271(1)(c), consequently, it communicates the exact charge left i.e. levy of penalty u/s 271AAB(1) for undisclosed income where the proceedings u/s 132 of the Act is carried out. In this context, we heedful to quote that, our aforesaid view finds fortified by the decision of Sandeep Chandak Vs PCIT [ 2018 (6) TMI 106 - SC ORDER ] where in similar facts and circumstance th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orandum of appeal are; 1. On the facts and in the prevailing circumstance of the case, the leaned CIT(A) has erred in law in confirming the penalty of Rs. 48,38,948/- out of the total penalty of Rs. 3,28,38,948/- imposed by the Assessing officer under s.271AAB of the Income-Tax Act 1961 without considering and appreciating the material fact that impugned jurisdictional show cause notice under section 274 of the Act, is itself illegal in the absence of any specific charged in the said notice, as admitted in the appellate order that , in the notice issued mistake of quoting wrong section occurred. Therefore, as impugned jurisdictional notice being illegal bad in law and hence penalty may please be deleted. 2. On the facts and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iling original return of income [for short ITR ] incorporating an additional income ₹28,00,00,000/- declared during the survey action and ₹4,83,89,485/- during search action u/s 132 of the Act, which eventually trigged the penalty provision u/s 271AAB of the Act. 4.2 During the penal proceedings, the assessee was put to a show cause notice [for short SCN ] u/s 274 r.w.s. 271 dt. 28/12/2016, which the appellant strongly contended citing dual reasons, firstly; the provisions of section 271AAB of the Act are discretionary and not mandatory in nature, hence having regard to facts and circumstance of her case the levy penalty is unwarranted, and secondly unsustainability of penalty for reason of deficiency in the SCN i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es to be deleted in limine for being fatal incurable u/s 292BB of the Act. While coming to third substantive ground alleging the mechanical approval granted by the Ld. JT CIT, the Ld. AR adverting to para 8 of penalty order pinpointed that, the date of order imposing the penalty vis- -vis date of according approval as one i.e. 28/06/2017. Per contra, the Ld. DR on first two grounds supported the orders of Ld. TAB and insofar as the mechanical approval is concerned the Ld. DR strongly argued that, the order imposing the penalty was culminated after the receipt of approval from the Ld. JCIT, which cannot be flare backed to colour otherwise. 6. After hearing to rival contentions of both the parties; and subject to the provisions o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esentative you may show cause in writing on or before the said date which will be considered before any such order is made under section 271AAB. 9. On a perusal of the provisions of section 271AAB, it is distinctly evident that the section 271AAB of the Act is self-contained. It is worthy to note that, on one hand, the sub section (1) thereof authorises levy of penalty on undisclosed income where the proceedings u/s 132 of the Act is initiated, and on the other hand the sub-section (2) puts an embargo on imposing of penalty u/s 270A and u/s 271(1)(c) of the Act on such undisclosed income falling within the realm of sub-section (1). This clearly establishes the solitary domain of section 271AAB over undisclosed income where the proce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee, and in the course of search, assessee made a statement admitting certain undisclosed income. Assessing Officer added said amount to assessee's taxable income and thereupon, issued a notice u/s 274 r.w.s. 271 of the Act for initiating penalty proceedings to which assessee submitted written reply. Assessing Officer having rejected assessee's explanation, passed a penalty order u/s 271AAB. Tribunal proceeding on presumption that penalty proceedings had been initiated u/s 271(1)(c), set aside penalty order . High Court took a view that where assessee in course of search admits undisclosed income and the manner in which such income has been derived, then provisions of section 271AAB would automatically be attracted and f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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