9911796707
TMI Blog2024 (10) TMI 251X X X X Extracts X X X X X X X X Extracts X X X X ..... e Act declaring total income at Rs. 6,54,15,120/- for the year under consideration. A search in the present case was carried out under section 132 of the Act on 06.01.2021 at the premises of Hans Group including assessee. Assessment was accordingly carried out as per provision of section 153A of the Act. Certain additions of Rs. 2,27,000/- were made under section 50C of the Act and the total income was assessed at Rs. 6,56,42,120/-. While framing the assessment, the Assessing Officer invoked penalty proceeding under Section 271AAB of the Act. The Assessing Officer consequently passed order under Section 271AAB of the Act treating an amount of Rs. 3,20,33,060/- included in the ROI as undisclosed income susceptible to penalty under Section 27 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AB(1A) and submitted that the AO was factually wrong in presuming that it would not have declared its income on account of LTCG and cash receipts had no search. and seizure took place on the appellant. The declaration of LTCG and cash receipts in ITR is not based on any incriminating material found during the search but it was declared in the normal course. The appellant is an individual and does not maintain any books of account. Therefore, any presumption that the appellant would not have disclosed the amount is self serving and baseless. 7.2 I have carefully presumed the penalty order, assessment order and the written submissions filed by the appellant. The undisclosed income as per provisions of section 271AAB is defined as under: ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n ITR has been accepted by the AO as explained income as he did not tax the cash receipt, u/s 69A r.w.s. 115BBE of the Act. Therefore, I find that the LTCG and cash receipts disclosed by the appellant in ITR cannot be treated as "undisclosed income" as defined in the section 271AAB of the Act. Therefore, penalty u/s 271AAB(1A) held to be not sustainable and is deleted. 8. In the result, the appeal is allowed." 5. Aggrieved by the relief granted by the CIT(A), the Revenue is in appeal before the Tribunal. 6. As per the grounds of appeal, the Revenue has challenged the action of the CIT(A) deleting penalty imposed under Section 271AAB of the Act. 7. The learned DR for the Revenue relied upon the penalty order passed by the Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is case, the assessee had neither made any surrender of so called undisclosed income during the search nor was the penalty initiated is based on undisclosed income discovered during the search. It was contended that for the purposes of sub Section (1A)(a) to Section 271AAB of the Act, two conditions for levy of penalty needs to be satisfied. Firstly; there should be existence of undisclosed income and secondly; such income must be offered in the statement recorded under Section 132(4) of the Act. None of these conditions are fulfilled in the instant case. The transactions of LTCG are backed by Contract Note and the transaction has been carried out through banking channel. Thus, such transactions found in the bank statement in ordinary cours ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e AO thus do not align with the penalty provisions codified under Section 271AAB of the Act. 12. On perusal of the assessment order or penalty order, it is seen that there is no reference to any statement recorded under Section 132(4) of the Act which may show any kind of admission towards so called undisclosed income. Needless to say, the admission of undisclosed income of alleged undisclosed income (with some further conditions with which, we are not personally concern) is the fulcrum on which action under Section 271AAB(1A) of the Act is based. In the absence of such admission imposition of penalty @ 30% of the so called undisclosed income under clause - (a) of Section 271AAB(1A) of the Act is not justified. 13. Besides, the case of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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