9911796707
TMI Blog1999 (9) TMI 110X X X X Extracts X X X X X X X X Extracts X X X X ..... If filed its return of income for the asst. yr. 1987-88 and asst. yr. 1988-89 on 29th June, 1987, and 30th July, 1998, respectively. Search under s. 132 was carried out at the assessee's business premises as well as at the residence of its managing director and other director on 29th Nov., 1988, and 30th Nov., 1988. 5. During the course of search on 29th Nov., 1988 at the residence of premises No. 44, Thornhill Road, Allahabad, Sri Shyama Charan Gupta, managing director of the assessee-company disclosed an amount of Rs. 50 lakhs on account of various undisclosed investments, as the assessee's income, whereas during the course of search on 30th Nov., 1988 at the business premises of M/s Shyam Biri Works (P) Ltd. the assessee's director Sri Uma Charan Gupta disclosed a sum of Rs. 32,24,000 on account of unrecorded entries in regular books. Later on the assessee seems to have furnished an affidavit giving year-wise details of disclosed income of Rs. 33 lakhs as well as undisclosed income of Rs. 14,83,845. The year-wise details of disclosed income in the hand of 'Shyam Biri Works' and 'M/s Shyam Biri Works (P) Ltd.' were as under: --------------------------------------------------- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arch, 1990, when penalty proceedings under s. 271(1)(c) were also initiated. Later on the AO after rejecting the assessee's claim of immunity available in view of Expln. 5 to s. 271(1)(c) r/w s. 132(1) of the IT Act, 1961, imposed penalty on the total difference between the income as per so-called revised return and income in the original returns. In the revised returns, the additional income on account of disclosure made during the search was as under: Rs. Asst. yr. 1987-88 1,70,000 Asst. yr. 1988-89 31,30,000 6. On appeal, the CIT(A) cancelled the penalty on various differences for difference in income due to withdrawal of assessee's claim of various deductions made in the original return and confirmed the penalty on the additional income included as a result of disclosure made during the course of search i.e. CIT(A) restricted the penalty for asst. yr. 1987-88 on income of Rs. 1,70,000 and for asst. yr. 1988-89 on income of Rs. 13,30,000. The parties are in appeal against these orders of the CIT(A). 7. The assessee's counsel relied on the disclosure made in the statement recorded under s. 132(4) of the IT Act on 29th Nov., 1988 and 30th Nov., 1988. According to the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal, Allahabad Bench in the case of M/s Shyam Biri Works, Allahabad, for asst. yr. 1984-85, a copy of the order is placed on record. 9. The learned Departmental Representative was asked to quote any decision in support of his interpretation of cl. (2) to Expln. 5 to (sic) aware of any decision on this point. 10. We have considered the rival submissions and the fact and circumstances of the case placed before us and are of the opinion that the present case is not a fit case for imposition of penalty under s. 271(1)(c) because of the following reasons: 10.1. So far as the assessee's claim of immunity available under cl. (2) of Expln. 5 to s. 271(1)(c) is concerned, we consider it necessary to consider the respective stand of the parties by analysing the provisions of the Explanation which are as under: Explanation 5. Where in the course of a search under s. 132, the assessee is found to be the owner of any money, bullion, jewellery or other valuable article or thing (hereafter in this Explanation referred to as assets) and the assessee claims that such assets have been acquired by him by utilising (wholly or in part) his income: (a) for any previous year which has ended before t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the return(s) so furnished were to be furnished in view of cls. (a) and (b) of sub-s. (1) of s. 139, meaning thereby that this clause refers to the return(s) already having been furnished as well as the returns which is yet to be furnished. Had it not been the case then words "which has not been disclosed so far "should not have been in the provisions. Existence of these words clearly leads one to understand that this clause is applicable to the return(s) already furnished as well as to the return to be furnished though of course such returns should have been furnished under cls. (a) and (b) to sub-s. (1) of s. 139. 12. In view of this interpretation of cl. (2) we are of the opinion that the interpretation put by the learned Departmental Representative is not acceptable and consequently we held that immunity available under cl. (2) was for previous assessment year(s) also i.e., the assessment years for which return(s) of income has/have been furnished. So far as assessee's case is concerned it is admitted fact that the assessee has disclosed an income of Rs. 82 lakhs which was inclusive of income of sums of Rs. 1,70,000 and Rs. 2,30,000 for the asst. yr. 1987-88 and 1988-89 and, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
