Income Tax Appellate Tribunal - Chandigarh
M/S Deepak Builders, Ludhiana vs Dcit, Cc-1, Ludhiana on 31 May, 2019
आयकर अपील य अ धकरण,च डीगढ़ यायपीठ "ए" , च डीगढ़
IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH "A", CHANDIGARH
ी संजय गग , या यक सद य एवं डा. बी.आर.आर, कुमार, लेखा सद य
BEFORE: Sh. SANJAY GARG, JUDICIAL MEMBER & DR. B.R.R. KUMAR, ACCOUNTANT MEMBER
आयकर अपील सं./ ITA No. 934/Chd/2018
नधा रण वष / Assessment Years : 2014-15
Sh. Deepak Kumar Singal बनाम DCIT
Prop. Deepal Buildcon CC-1
Infrastructure, Near Lodhi Club Ludhiana
Ludhiana Punjab
थायी लेखा सं./PAN NO: AIZPS1486R
अपीलाथ /Appellant यथ /Respondent
आयकर अपील सं./ ITA No. 937/Chd/2018
नधा रण वष / Assessment Years : 2014-15
M/s Deepak Builders बनाम DCIT
120 Ft. Road, Near Lodhi Club CC-1
Shaheed Bhagat Singh Nagar Ludhiana
Ludhiana Punjab
थायी लेखा सं./PAN NO: AIZPS1486R
अपीलाथ /Appellant यथ /Respondent
आयकर अपील सं./ ITA No. 938/Chd/2018
नधा रण वष / Assessment Years : 2014-15
Sh. Kamal Kumar Singal बनाम DCIT
Through Legal heir Sh. Deepak K. CC-1
Singal Ludhiana
712-B, Aggar Nagar, Ludhiana Punjab
Punjab
थायी लेखा सं./PAN NO: ADVPS6954P
अपीलाथ /Appellant यथ /Respondent
नधा रती क! ओर से/Assessee by : Shri. Sudhir Sehgal, Advocate
राज व क! ओर से/ Revenue by : Sh. Shiv Swaroop Singh, Sr. DR
सन
ु वाई क! तार&ख/Date of Hearing : 30/05/2019
उदघोषणा क! तार&ख/Date of Pronouncement : 31/05/2019
आदे श/Order
PER DR. B.R.R. KUMAR, A.M:
All the above appeals have been filed by the assessee against the separate order of Ld. CIT(A)-5, Ludhiana each dt. 20/04/2018.
2. Appeal wise grounds reproduced hereunder:
2Grounds of ITA No. 934/Chd/2018:
1. That the Ld. CIT(A) has erred in confirming the levy of penalty u/s 271AAB r.w.s 274 of the Income Tax Act, 1961 amounting to Rs. 15,00,000/-.
2. That the confirmation of penalty is against the facts and circumstances of the case.
3. That the Appellant craves leave to add or amend the grounds of appeal before the appeal is finally heard or disposed off.
Grounds of ITA No. 937/Chd/2018:
1. That the Ld. CIT(A) has erred in confirming the levy of penalty u/s 271AAB r.w.s 274 of the Income Tax Act, 1961 amounting to Rs. 1,40,20,000/-.
2. That the confirmation of penalty is against the facts and circumstances of the case.
3. That the Appellant craves leave to add or amend the grounds of appeal before the appeal is finally heard or disposed off.
Grounds of ITA No. 938/Chd/2018:
1. That the Ld. CIT(A) has erred in confirming the levy of penalty u/s 271AAB r.w.s 274 of the Income Tax Act, 1961 amounting to Rs. 1,50,000/-.
2. That the confirmation of penalty is against the facts and circumstances of the case.
3. That the Appellant craves leave to add or amend the grounds of appeal before the appeal is finally heard or disposed off.
3. Brief facts of the case are that a search was conducted u/sec 132(1) of the Income Tax Act, 1961 on 20.03.2014 at the Premises of the concern. The Assessee is a partnership concern and is a Civil Contractor. The notice dated 23.01.2015 u/sec 142(1) r.w.s 143(2) of the Act was issued and duly served. The assessee filed his return of income on 28.11.2014by declaring income of Rs. 11,84,55,440/-. It is worth to mention here that the return of income was filed suomoto by the Assessee u/sec 139(1) within the time. The Assessee has duly disclosed the surrender amount of Rs. 14.02,00,000/- in the said return. The Assessee had filed the surrender letter which is duly forming part of the penalty order. The Assessment in the case of the Assessee was framed vide order dated 30.03.2016 at the income of Rs. 11,88,87,430/-, wherein the only addition which was made was on account of disallowance of l/10th of vehicle expenses on account of personal use.Thus, the surrender amount as disclosed by the Assessee in the return of income was accepted as such by the Assessing Officer. The Assessing Officer at the time of passing the assessment order has duly accepted the surrender as made by the Assessee as there was no incriminating material found during the course of search. The Assessing Officer initiated the penalty proceedings u/sec 271AAB of the Act in the assessment order by merely stating as under:
3"Thus, the undisclosed income of Rs. 14,02,00,000/- disclosed u/sec 132(4) of the Act is liable for penal action within the meanings of section 271AAB of the Act and accordingly, penalty proceedings u/sec 271AAB has been initiated".
From the above it is very much clear that the Assessing Officer has not recorded his satisfaction at the time of initiating the penalty proceedings u/sec 271AAB of the Act as to how the provisions of section 271AAB of the Act are applicable to the case of the Assessee and thus, without satisfaction being recorded, there co'jld be no initiation of penalty proceedings. Thereafter penalty order u/sec 271AAB of the Act was passed vide order dated 30.09.2016. Appeal was filed before the CITA) against the above said order passed u/sec 271AAB of the Act which was duly dismissed vide order dated 20.04.2018 by only observing that the levy of penalty is mandatory.
4. Now the assessee is in appeal against the above said order of the CIT(A).
5. During the hearing before us, it was brought to our notice that the similar matter has been adjudicated in favour of the Revenue by the order of this Tribunal in ITA No. 935/CHD/2018 and 936/CHD/2018 in the case of Vishal Singhal and Sunita Singhal respectively. For the sake of ready reference the said order is reproduced hereunder:
The present appeals have been filed by different assessees against the separate orders of the Commi ssi oner of Income Tax (Appeals)-5, Ludhiana (in short 'CIT(A)' both dated 20.4.2018 confirming the levy of penalty u/s 271 AAB of the Income Tax Act, 1961 (hereinafter referred to as 'Act').
2. It was common ground that the issue involved in both the appeals was identical, relating to levy of penalty u/s 271AAB of the Act, subsequent to assessment framed in consequence to search carried out on Deepak Singal group of cases, which included both the assesses and it was contended that the facts leading to the levy of penalty in both the cases were identical. Therefore, both the appeals were taken up together and are being dealt with by way of this common consolidated order.
We shall first be dealing with the facts in the case of Vishal Singal Vs. DCIT in ITA No.935/Chd/2018.
ITA No.935/Chd/2018(Vishal Singal):3. Brief facts relating to the case are that a search u/s 132(1) of the Act was conducted on the assessee on 20.3.2014. During assessment proceedings thereafter, it was found that at the time of search proceedings the assessee had admitted undisclosed income amounting to Rs.10 lacs in the statement made u/s 132(4) of the Act. Penalty proceedings u/s 271AAB of the Act were therefore initiated and show cause notice u/s 274 r.w.s.271AAB of the Act was issued to the assessee. In response, the assessee submitted that it had filed its return of income disclosing total income of Rs.9,78,250/-, which included surrendered income and which had been accepted as 4 such. It was submitted that the assessee had substantiated the manner in which the undisclosed income had been earned and had also paid taxes on the same. It was further submitted that no valuable items had been found during search. It was thus contended that penalty proceedings initiated be therefore dropped. The Assessing Officer(A.O) did not find the reply of the assessee tenable. He reproduced the provisions of section 271AAB of the Act and also the surrender letter giving the amount and basis of surrender of additional income during search. Referring to the same, the A.O. stated that it was clear from the same that the surrender was made to cover the discrepancy found in the seized documents during search and to cover any kind of discrepancy in the regular books of account and also income yet to be recorded in the books of account. He, therefore, held that the assessee's case clearly fell under the provisions of section 271AAB(1)(a) of the Act and thus levied the penalty accordingly on the surrendered income @ 10% thereof, which amounted to Rs.1 lac.
4. The assessee went in appeal before the CIT(A), who upheld the order of the A.O.
5. Aggrieved by the same, the assessee has come up in appeal before us, raising the following grounds:
"1. That the Ld. Commissioner of Income Tax (Appeals) has erred in confirming the levy of penalty u/s 271AAB r.w.s. 274 of the Income Tax Act, 196,1 amounting to Rs. 1,00,000/-
2. That the confirmation of penalty is against the facts and circumstances of the case.
3. That the Appellant craves leave to add or amend the grounds of appeal before the appeal is finally heard or disposed off."
6. During the course of hearing before us, the Ld. counsel for assessee reiterated the contentions made before the lower authorities. The Ld. counsel for assessee contended that there was no undisclosed income, as defined in section 271AAB of the Act and, therefore, no penalty could be levied. The Ld. counsel for assessee drew our attention to the definition of the undisclosed income in Explanation to section 271AAB of the Act as under:
"271AAB:-
Explanation.--For the purposes of this section,--
(a) xxxx
(b) xxxx
(i) xxxx
(ii) xxxx
(c) "undisclosed income" means--
(i) any income of the specified previous year represented, either wholly or partly, by any money, bullion, jewellery or other valuable article or thing or any entry in the books of account or other documents or transactions found in the course of a search under section 132, which has--5
(A) not been recorded on or before the date of search in the books of account or other documents maintained in the normal course relating to such previous year; or (B) otherwise not been disclosed to the [Principal Chief Commissioner or] Chief Commissioner or [Principal Commissioner or] Commissioner before the date of search; or
(ii) any income of the specified previous year represented, either wholly or partly, by any entry in respect of an expense recorded in the books of account or other documents maintained in the normal course relating to the specified previous year which is found to be false and would not have been found to be so had the search not been conducted.]"
7. Referring to the same, the Ld. counsel for assessee contended that the undisclosed income meant any income which was represented by any asset found during the course of search or any entry in the books of account or other documents, which has not been recorded before the date of search or not disclosed earlier to the Principal, Chief Commissioner or Commissioner of Income Tax Act. The Ld. counsel for assessee contended that some incriminating material representing earlier undisclosed income of the assessee ought to have been found during the course of search which would qualify as "undisclosed income" for the purpose of levy of penalty u/s 271AAB of the Act. The Ld. counsel for assessee contended that in case of the assessee there is no reference to any document or asset found during the course of search either in the assessment order or in the penalty order and, therefore, there was no case of levy of penalty at all. The Ld. counsel for assessee contended that as per the definition of undisclosed income, if any entry is found to be false, the same also qualifies as undisclosed income but even that has not been found in assessee's case. The Ld. counsel for assessee relied upon the following case laws in support of his contention that in the absence of any undisclosed income no penalty u/s 271AAB was leviable:
1. DCIT Vs. Hari Singh, ITA No.598/CHD/2017 CHD-TRIB
2. DCIT Vs. Manish Agarwal, ITA No.1479/KOL/2015 KOL-
TRIB
3. DCIT Vs. Amit Agarwal, ITA No.1471/KOL/2015 KOL- TRIB
4. ACIT Vs. S.Martin, ITA No.2382/CHENY/2016 CHENAI- TRIB
5. DCIT Vs. M/s Aryan Mining & Trading Corporation Ltd., ITA No.1601/KOL/2017 KOL-TRIB
6. DCIT Vs. Rashmi Cement Ltd., ITA No.1606/Kol/2017 KOL-TRIB
7. DCIT Vs. Rashmi Metaliks Ltd., ITA No.1608/Kol/2017 KOL-TRIB
8. The Ld. DR at this juncture countered by drawing our attention to the surrender letter of the assessee reproduced in the penalty order as under:
The Joint/Additional Director of Income Tax Dt. 11-4-2014 6 (Inv.), Ludhiana Sir, Re: Search and seizure operations at the residential and business premises of M/s Deepak Builders and other Group of Cases.
This has a reference to the search and seizure operations carried out by the department on 20,03.2014 at the various business premises of M/s Deepak Builders Group of Companies and residential premises of the Directors/Partners. During the course of search, certain discrepancies were there in the cases of Deepak Builders .and other Companies, Partnership Firms and Individuals cases of (Group; These discrepancies were in .respect. of; the books of accounts of the business maintained by the assessee and also, there were certain entries which had not yet been recorded in the regular books of account for the different Assessment Years. The- said discrepancies relate to the same nature of business as reflected in the regular books of accounts arid otherwise and is a part and parcel of the same business activity as reflected in the return of income filed with the Department and in order to cover such discrepancies and others, we hereby offer a sum of Rs. 23 crores (Rupees twenty Three Crores Only) as additional income as declared in the return of income already filed with the Department over and above the regular income and the said income has been derived from the same source.. We .had already given an offer of surrender of Twenty Three Crores in the group as a whole and, now, in this letter, the offer remains the same and also persons in whose hands the amount has been offered are also the same but there are some adjustments and, now, the head-wise bifurcation after examination the seized documents, the amount offered as business income from the business activities is as under.-
Name of the Assessment Amount Basis
Concern/Individual Year . Surrendered
M/s Deepak 2014-15 14,02,00,000.00 Offered as Business income to
Builders 2013-14 cover any discrepancies in the
21,00,000.00 seized documents as found and
seized during the course of
search and also to cover any
kind of discrepancy in the regular
books of account and the above
income was earned in the same
manner as stated above as per
regular books of account and
that income is yet to be
recorded in the books of
account. The above income is
reflected in various expenses i.e.
payment of labour expenses etc.
and other seized records and
any kind of profit element found
during the course of search. The
income for the Assessment Year
2013-2014 is being offered
7
Sh Deepak Singal 2014-15 2013- 6,70,00,000.00 Offered as Business' income to
14 cover any discrepancies in the
10,00,000.00 seized documents as found and
2012-13 seized during the course of search
16,00,000.00 as per various Annexure and for
2011-12 any kind of discrepancy in the
60,00,000.00
regular books of accounts and the
2009-10
60,00,000.00 above income was earned in the
2008-09 same manner as reflected in my
21,00,000.00 return of income. The above
income is reflected in various
personal assets including amount
spend on construction, cash and
to cover any investment in the
immovable/moveable asset. The
income for the Assessment Year
2008-2009 to 2013-2014 is being
offered subject to no penalty
Smt. Sunita Singal 2014-15 15,00,000.00 U/s 271(1income
Offered )(c) ofearned
the Income Tax
from sale
or purchase of property and the
same income reflected in
construction/invest merit to
immovable assets and to cover
any other asset or, documents as
found during the course of search
and jewellery, cash etc. and other
misc. activities.
Sh.Kamal Singal 2014-15 15,00,000.00 To cover all the documents as
found during the course of search
and the income has been derived
from commission/brokerage from
property dealing.
Sh.Vishal Singal 2014-15 10,00,000.00 To cover all the documents as
found during the course of search
and the income has been derived
from commission/ brokerage
from property dealing.
2. It is pertinent to mention here that there was a. survey operation on the business premises of the assesses on 8,1,2010 i.e. in the Assessment Year 2010-2011 and during the course of survey the assessee had made a surrender of Rs.4 Crores (Rs. 3 Crores in the case of M/s Deepak Builders and Rs.1 Crore in the case of Shri Deepal Singal, Proprietor M/s Deepak Buildcon). The above surrender in the case of M/s Deepak; Builders of Rs.3 Crores covers all the loose documents or any kind Of implication of income in the seized documents for the Assessment Year 2010-11 as found during the course of search, if any and Rs.1 Crore in the case of Shri Deepak Singal Proprietor M/s Deepak Buildcon covers the cash received on account of the sale of flats over and above the amount reflected in the books of account for the Assessment Years 2009-010 arid 2010-
2011. The assesses Shri Deepak Singal had been earned the income on account of the sale of flats and the same income as offered during the course of survey had been reflected in the cash, recoverable and amount spends in the, construction of flats. The copy of the statement as recorded during the course of survey is being enclosed herewith for your ready reference.
3. The above amount as offered are tentative and subject to change any time during proceeding before your goodself and also filing Of the return U/s 153A but offer will remain the same and covers all the issues as per seized record or any kind of discrepancy in the regular books of account or otherwise and is the, business income of the assessee. The above offer also covers the! rough notings/estimates and other slips on account of sales, purchases outside the books of accounts, besides, profit element on account of variation in the Sale Rates of Rats etc. and to cover other discrepancies.
4. The above offer in, the .different years as mentioned .above is being made as per the provisions of income Tax Act and this offer is being made Subject to no penalty u/s 271AAA/ 271AAB/271(1)(c) and prosecution and the above income shall be declared by our group concerns in respective years .While filing the return in the relevant years over and above.
9. Referring to the same the Ld. DR pointed out that the assessee had surrendered an amount o Rs.10 lacs in his case and as per the surrender letter it was on account 8 of discrepancy in the books of account of the business of the assessee and certain entries not recorded in the regular books of account which were noted during search. The Ld. DR pointed out that the assessee had even stated in the surrender letter that it had derived income from commission/brokerage from property on account of which the surrender had been made. Our attention was drawn to para-1 of the surrender letter pointing out that the above facts had been stated therein. The Ld. DR thereafter drew our attention to para- 3 of the letter pointing out that the assessee had reiterated the fact that the surrender was being made on account of discrepancies in the seized records and other documents found during the course of search including rough notes/assessments and other slips on account of sales, purchases outside the books of account and other discrepancies. The Ld.DR therefore, stated that the contention of the Ld. counsel for assessee that no incriminating material was found during the course of search which related to the surrender made was factually incorrect. The Ld. DR further relied upon the findings of the Ld.CIT(A) at para 4.1 of his order as under:
"The facts of the case, the order of the AO imposing the penalty and the arguments of the AR during appellate proceedings have been considered. The AR has repeated the contentions which were raised before the AO. It is fairly conceded by the AR that in the present case provisions of Section 271AAA are not applicable and now the case is governed by the provisions of Section 271AAB. For deciding the issue and to have clarity in the matter the provisions of Sections 271AAB which are applicable to the present case under consideration are reproduced below.
"271AAB. (1) The Assessing Officer may, notwithstanding anything contained in any other provisions of this Act, direct that, in a case where search has been initiated under section 132 on or after the 1st day of July, 2012, the assessee shall pay by way of penalty, in addition to tax, if any, payable by him,-
(a) a sum computed at the rate of ten per cent of the undisclosed income of the specified previous year, if such 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 derived;
(ii) substantiates the manner in which the undisclosed income was derived; and
(iii) on or before the specified date-
(A) pays the tax, together with interest, if any, in respect of the undisclosed income; and (B) furnishes the return of income for the specified previous year declaring such undisclosed income therein;
(b) a sum computed at the rate of twenty per cent of the undisclosed income of the specified previous year, if such assessee-
(i) in the course of the search, in a statement under sub-section (4) of section 132, does not admit the undisclosed income; and
(ii) on or before the specified date-
(A) declares such income in the return of income furnished for the specified previous year; and (B) pays the tax, together with interest, if any, in respect of the undisclosed income;
(c) a sum which shall not be less than thirty per cent but which shall not exceed ninety per cent of the undisclosed income of the specified previous year, if it is not covered by the provisions of clauses (a) and (b).9
(2) No penalty under the provisions of clause (c) of sub-section (1) of section 271 shall be imposed upon the assessee in respect of the undisclosed income referred to in sub section (1).
(3) ...
As admitted by the AR also, that the income of Rs. 10,00,000/- was surrendered during the search. Regarding the basis it was admitted (as per the surrendered letter reproduced by the AO in the penalty order) by the assessee that cover all the documents as found during the course of search and the income has been derived from commission/brokerage from property dealing".
The AO has rightly mentioned that in this case the income of Rs. 10,00,000/- was disclosed by the assessee in the return of income and the same was not disclosed to the Department till the search action. The assessee has surrendered this amount under section 132 on 11.04.2014. Therefore, provisions of section 271AAB are applicable. It is also not in dispute that the case of the assessee is covered under sub-section (l)(a) of Section 271AAB as the assessee has paid the tax along with the interest and disclosed the amount in the return. The language of the Section is very clear and unambiguous that in a case where the assessee admits the undisclosed income under Section 132(4), then the assessee shall pay penalty equal to 10% of the undisclosed income. In view of the above provisions of law, the penalty imposed by the AO in this case is found as per law and hence sustained.
Accordingly, these grounds of appeal are dismissed."
10. We have heard the contentions of both the parties and perused the orders of the authorities below. The sole contention of the Ld. Counsel for the assessee, agai nst the levy of penalty under section 271AAB of the Act, is that no incriminating material representing "undi sclosed i ncome" of the assessee was found during the course of search. We do not find any merit in this contention of the Ld. Counsel for the assessee.
11. The surrender letter of the assessee, admitting to the discrepancies in the books of account and certain entries not bei ng recorded i n the books, as also specifi c admi ssi on to the fact that the assessee had not disclosed the income relating to commi ssi on and brokerage, contradi cts thi s contention of the Ld. Counsel for the assessee. In the surrender letter, as reproduced in the earlier part of this order, the assessee has categorically admitted that there were discrepancies in respect of the books o f a c c o u n t o f t h e b u s i n e s s m a i n t a i n e d b y h i m a n d t h e r e we r e c e r t a i n e n t r i e s wh i c h h a d n o t b e e n r e c o r d e d i n t h e r e g u l a r b o o k s of account for different Assessment Years and that the said discrepancies related to the same nature of business as reflected in the regular books of account. Further, in the surrender letter the assessee has also speci fically admitted that hi s i ncome from commi ssi on and brokerage had remained undi sclosed. The assessee had surrendered an amount of Rs.10 lakhs on account of these admitted undisclosed income and on account of discrepancies in the documents found during the search. The letter also mentions the nature of discrepancies found, being rough notings/estimates, other slips on account of sales, purchases outside the books of account, besides profit element on account of variation in the sale rates of flat, etc. Clearly, the surrender bei ng so specifi c cannot not be sai d to be merely to buy peace of mind. Further, the assessee has never retracted the surrender so made; on the contrary, he has disclosed the amount surrendered as his business income in the return of income filed and accepted the assessment of the same as such, by the A.O. All the above facts have remai ned uncontroverted before us. Thi s specific unretracted admi ssi on of the assessee of earlier undisclosed income and discrepancies in the books of a c c o u n t , we h o l d , i s wi t h o u t a n y d o u b t t h e b e s t p i e c e o f evidence against the assessee and is incriminating material enough representing undisclosed income for the purpose of levy of penalty under section 271AAB of the Act. The assessee had himself admitted to the fact of having not disclosed the income 10 on account of brokerage and commi ssi on earned and had himself admitted to the fact that there were discrepancies and unrecorded entries in his books of account and also certain rough notings and estimates. Having himself admitted to all these facts and at no point of time having ever retracted this admi ssi on, the same consti tutes incrimi nating materi al against t h e a s s e s s e e a n d t h e r e wa s n o f u r t h e r r e q u i r e m e n t f o r t h e Reven ue i n such ci rcum stances to have unearthed evi dence supporting this admission of the assessee.
12. The reliance placed by the Ld.Counsel for the assessee on vari ous case laws ,we fi nd are of no assi stance si nce they are all di sti ngui shable on facts. In none of the case la ws the assessee had specifically admitted to earlier undisclosed income. In the case of Hari Singh (supra) penalty levied u/s 271 AAB of the Act, on addi ti on made on account of difference i n valuati on of jewellery was deleted holding that the difference in value of Rs.1.3 lacs on valuation of Rs.1.2 crores was not unnatural and c o u l d b e o n a c c o u n t o f d i f f e r e n c e o f o p i n i o n a n d wa s t h e r e f o r e not i n the nature of undi sclosed i ncome of the assessee. I n the c a s e o f M a n i s h A g g a r wa l ( s u p r a ) , i t wa s n o t e d t h a t t h e a s s e s s e e was not engaged in any business or profession and was not required to maintain any books of accounts and the documents found during search di sclosi ng speculative commodity t r a n s a c t i o n u n d e r t a k e n b y t h e a s s e s s e e wh i c h wa s s u r r e n d e r e d , wa s h e l d t o b e r e c o r d e d i n t h e " o t h e r d o c u m e n t s " o f t h e assessee and hence held to be not undi sclosed i ncome of the assessee as per the defi niti on of the same i n section 271AAB of the Act. In the case of S. Marti n (supra) the surrender made by t h e a s s e s s e e wa s f o u n d t o b e n o t a d m i t t e d o n t h e b a s i s o f a n y material ,document and was just a general surrender, which t h e r e f o r e wa s n o t h e l d t o c o n s t r u e u n d i s c l o s e d i n c o m e f o r t h e purposes of levy of penalty. In the case of Rashmi Cement(supra) i t wa s n o t e d t h a t t h e s u r r e n d e r m a d e w a s s u o m o t o , g e n e r a l , t o buy piece of mind and not based on any material. In such ci rcum stances it was held that the surrender di d not in itself constitute i ncriminati ng materi al/undi sclosed i ncome of the assessee. The facts leading to the deletion of penalty in the case of Rasmi Metali ks(supra) we fi nd are i denti cal to that i n the case o f R a s h m i C e m e n t s ( s u p r a ) . T h u s c l e a r l y n o n e o f t h e c a s e l a ws are of any assistance to the assessee since in the impugned case the assessee has made specifi c admi ssi on of havi ng undi sclosed i ncome relati ng to commi ssi on/brokerage and di screpanci es in t h e b o o k s o f a c c o u n t s wh i c h h a s r e m a i n e d u n r e t r a c t e d .
13. I n v i e w o f t h e a b o v e , we c o n c u r wi t h t h e f i n d i n g s o f t h e L d . CIT(A) that the specific admi ssi on of the assessee to the undisclosed income and discrepancies in its accounts constituted incriminating material representing undisclosed income of the assessee for the purposes of levy of penalty under section 271AAB of the Act. We, therefore, uphold the order of the Ld. CIT(A) confirming the levy of penalty.
In view of the above the appeal filed by the assessee is di smi ssed.
14. Now, taking up the appeal of the assessee in ITA No.936/CHD/2018, the facts of the case we find are identical, wi t h t h e a s s e s s e e , S m t . S u n i t a S i n g a l , a l s o b e i n g o n e o f t h e persons searched in the Deepak Singal group of cases and the assessee having surrendered an amount of Rs.15 lakhs during the c o u r s e o f s e a r c h , o n wh i c h p e n a l t y u n d e r s e c t i o n 2 7 1 A A B o f t h e A c t wa s l e v i e d . The arguments of the Ld.Counsel for the assessee, against levy of penalty were identical as in the case of S h . V i s h a l S i n g a l i n I T A N o . 9 3 5 / C H D / 2 0 1 8 d e a l t wi t h u s a b o v e , t h a t n o i n c r i m i n a t i n g m a t e r i a l r e p r e s e n t i n g u n d i s c l o s e d i n c o m e wa s found during the course of search.
15. In thi s case, we have noted from the surrender letter of the assessee reproduced above in para , that the surrender of Rs.15 l a k h s wa s i d e n t i c a l a s i n t h e c a s e o f V i s h a l S i n g a l i n I T A 11 No.935/CHD/2018 to cover all documents found during the course of search and to cover the i ncome derived from sale or p urchase o f p r o p e r t y , wh i c h r e m a i n e d u n d i s c l o s e d e a r l i e r a n d t h e s a m e reflected i n constructi on/i nvestment i n immovable assets. Si nce the facts leadi ng to levy of penalty i n the present case are identical to that in the case of the assessee in ITA No.935/CHD/2018 and the arguments of the assessee against the same are also i denti cal, our deci si on rendered i n the case of the a s s e s s e e i n I T A N o . 9 3 5 / C H D / 2 0 1 8 wi l l s q u a r e l y a p p l y t o t h e p r e s e n t c a s e a l s o , f o l l o wi n g wh i c h we u p h o l d t h e o r d e r o f t h e L d . CIT(A) confirming the levy of penalty under section 271AAB of the Act, amounting to Rs.1.50 lakhs. The appeal of the assessee is accordi ngly di smi ssed.
16. In the result, both the appeals of the assessee are di smi ssed.
6. As a result, all the appeals of the assessee are hereby dismissed.
Sd/- Sd/-
संजय गग डा. बी.आर.आर, कुमार,
(SANJAY GARG ) ( DR. B.R.R. KUMAR)
या यक सद य/ Judicial Member लेखा सद य/ Accountant Member
AG
Date: 31/05/2019
आदे श क! त,ल-प अ.े-षत/ Copy of the order forwarded to :
1. The Appellant , 2 The Respondent , 3. CIT, 4. The CIT(A), 5. DR, ITAT, CHANDIGARH, 6. Guard File