Income Tax Appellate Tribunal - Chandigarh
Sh. Pawan Sahni, Solan vs Dcit, Cc-Ii, Chandigarh on 30 November, 2018
आयकर अपील
य अ धकरण,च डीगढ़ यायपीठ "बी" , च डीगढ़
IN THE INCOME TAX APPELLATE TRIBUNAL,
CHANDIGARH BENCH 'B' , CHANDIGARH
ीमती दवा संह, या!यक सद"य एवं, एवं ीमती अ नपणा%
ू ग'ता
ु , लेखा सद"य
BEFORE: SMT.DIVA SINGH, JM & SMT.ANNAPURNA GUPTA, AM
आयकर अपील सं./ ITA No.1372/Chd/2017
नधा रण वष / Assessment Year : 2010-11
Shri Manoj Sahni, बनाम The D.C.I.T.,
Sahni's Ashiana, Circular Central Circle-II ,
Road, Solan (H.P.) Chandigarh.
थायी लेखा सं./PAN NO: AFNPS5722P
अपीलाथ /Appellant यथ /Respondent
आयकर अपील सं./ ITA No.1373/Chd/2017
नधा रण वष / Assessment Year : 2010-11
Shri Pawan Sahni, बनाम The D.C.I.T.,
Sahni's Ashiana, Circular Central Circle-II ,
Road, Solan (H.P.) Chandigarh.
थायी लेखा सं./PAN NO: AERPS9602P
अपीलाथ /Appellant यथ /Respondent
आयकर अपील सं./ ITA No.194/Chd/2014
नधा रण वष / Assessment Year : 2007-08
The D.C.I.T., बनाम Shri Manoj Sahni,
Central Circle-II , Sahni's Ashiana,
Chandigarh. Circular Road, Solan
(H.P.)
थायी लेखा सं./PAN NO: AFNPS5722P
अपीलाथ /Appellant यथ /Respondent
आयकर अपील सं./ ITA No.37/Chd/2017
नधा रण वष / Assessment Year : 2010-11
The A.C.I.T., बनाम M/s Dev Bhoomi
Central Circle-II , Apartments(AOP),
Chandigarh. Kalka Shimla Road,
Deonghat, Solan.
थायी लेखा सं./PAN NO:AAAAD5685P
अपीलाथ /Appellant यथ /Respondent
आयकर अपील सं./ ITA No.201/Chd/2014
नधा रण वष / Assessment Year : 2010-11
2
The D.C.I.T., बनाम M/s Dev Bhoomi
Central Circle-II , Apartments(AOP),
Chandigarh. Kalka Shimla Road,
Deonghat, Solan.
थायी लेखा सं./PAN NO:AAAAD5685P
अपीलाथ /Appellant यथ /Respondent
&
आयकर अपील सं./ ITA No.143/Chd/2015
नधा रण वष / Assessment Year : 2010-11
The A.C.I.T., बनाम M/s Dev Bhoomi Green
Central Circle-II , Valley,
Chandigarh. Kalka Shimla Road,
Deonghat, Solan.
थायी लेखा सं./PAN NO:AAAAD5140P
अपीलाथ /Appellant यथ /Respondent
नधा रती क ओर से/Assessee by : S/Shri Raj Kumar
& Sumit Goyal, CAs
राज व क ओर से/ Revenue by : Smt.Anita Sinha, CIT DR
सनवाई
ु क तार#ख/Date of Hearing : 04.09.2018
उदघोषणा क तार#ख/Date of Pronouncement: 30.11.2018
आदे श/ORDER
PER BENCH :
Al l the above appeal s rel ate to di fferent assessees bel ongi ng to the same group, i .e. Sahni Group, wh ere search acti on was carri ed out u/s 132( 1) of the I ncome Tax Act, 1961 ( i n short referred to as 'Act') .Whi l e the appeal s i n I TA No.1372 & 1373/Chd/2017 are assessees appeal agai nst separate orders of the Com mi ssi oner of I ncome Ta x ( Appeal s) -3, Gurgaon dated 15.6.2017, confi rmi ng penal t y l evi ed u/s 271AAA of the Act, the rest are appeal s fi l ed by the Revenue agai nst orders passed by the CI T( A) Si nce the appeal s ari se from the common acti on of search carri ed out on a group to whi ch al l the above assessees rel ate, the y were taken up together for heari ng.3
3. A t t h e o u t s et , i t w a s p o i n t ed ou t t h a t t h e t a x e f f e ct involved in all the a p p e al s filed by the R e v en u e i . e . i n I TA N o . 1 9 4 / C hd / 2 0 1 4 , I TA N o . 3 7 / C h d /2 0 1 7 , I TA No. 1 4 3 / C h d / 20 1 5 an d I TA N o . 2 0 1/C h d / 2 0 1 4 i s l ess than R s. 20 l acs. Th e Ld . DR has al so f ai rl y admi tted that CBD T ci rcul ar No. 3/2018 i s appl i cabl e to thi s appeal , hence, thi s appeal of the Revenue i s l i abl e to be di smi ssed.
4. I t ma y be noted that CBD T vi de Ci rcul ar No. 3/ 2018 dated 11.07.201 8 has revi sed th e monetar y l i mi t upto Rs.20 l acs for fi l i ng appeal s by the Department before the Tri bunal and further vi de para 13 of the sai d Ci rcul ar i t has been cl ari fi ed that sai d ci rcul ar i s appl i cabl e retrospecti vel y to the pendi ng appeal s al so. The Hon'bl e Punjab & Har yana Hi gh Court i n the case of "Pri nci pal CI T of I ncome Ta x Vs .
Suri nder Kumar Si nghal " I TA No 406-2016 ( O&M) vi de order dated 30.1.2017 whi l e further rel yi ng upon the decisi on of the Hon'bl e Supreme Court in the case of "CI T Vs. Dhanal ekshmi Bank Ltd." ( 2015 ) 373 I TR 526 ( SC) , has di smi ssed the ap peal of the Reve nue wi thout goi n g into the meri ts due to l ow ta x effect l eaving the questi on of l a w open. I n vi e w of the CBD T Ci rcul ar No. 03/2018 ( supra) and i n the l i ght of the ab ove referred to deci si on of th e Hon'bl e Juri sdi cti onal Punjab & Har yana Hi gh Court (supra), the present appeal o f the Revenue i s di smi ssed due t o lo w ta x effect.
5. I t i s, ho wever, cl ari fi ed that the di smi ssal of the above appeal shal l not be taken to be affi rmati on of th e order of 4 the CI T( A) on meri ts. The l egal i s sue rai sed by the Revenue i s bei ng l eft open to be adjudi cated i n an appropriate case.
6. Th e D e p a r t m e n ta l a p p e al s i n I TA N o . 1 9 4 / C h d /2 0 1 4, I TA N o N o .3 7 / Ch d / 2 0 1 7 , I TA N o. 1 4 3 / C h d /2 0 1 5 a n d i n I TA N o . 2 0 1 / C hd / 2 0 14 a r e , t he r e f o re , d i s m i s s e d.
7. W e s h a l l n o w b e t a k i n g u p t h e a ss e s s e e ' s a p pe a l i n I TA Nos.1372 & 13 7 3 / C h d / 20 1 7 . It was c o mm o n ground b e t w e e n b o t h t he p a r t i e s t h a t th e p e n a l t y w a s l e v i e d u /s 2 7 1 A A A o f t h e A c t o n i de n t i c al s e t o f fa c t s i .e . o f c a sh s u r r e n d e re d . S i nc e t h e f a c t s an d i s s u e i n v o l v e d i n b o t h t h e a p p e a l s a r e c omm o n , t h e y a r e be i n g d e c i d ed t o ge t h e r . F o r c o n v e n i e nc e , w e s h a l l b e d e a l i ng w i t h t h e f a c t s i n t h e c a s e o f S h r i P a w a n S a h n i i n I TA N o . 1 3 7 3 / C hd / 2 0 17 a n d t h e d e c i s i o n re n d e r ed t h e r e i n wi l l ap p l y m u t a ti s mu t a n d i s i n t h e c a s e o f S h ri M a n o j S a hn i i n I TA N o . 1 3 7 2 / C h d/ 2 0 1 7 . I T A N o . 1 37 3 / C hd / 2 0 1 7 :
8. As stated a b o ve , the a ss e s s e e has c h a l l e n g ed t he a c t i o n o f th e L d .C I T( A ) i n up h o l di n g t h e l e v y o f pe n a l t y u / s 271AAA on c ash s u r r en d e r e d during search operation c a r r i e d ou t o n t he a s s e s s ee .
9. Brief fa c t s r e l ev a n t to the c as e are that s ea r c h o p e r a t i o ns u / s 1 3 2 ( 1 ) o f t he Ac t w e r e c a rr i e d o u t a t t he r e s i d e n t i a l a nd b u s i n e s s p r e m i se s o f S a h n i G r ou p o f C a s e s i n c l u d i n g t he a ss e s s e e s o n 1 1 . 9.2 0 0 9 , d u r i n g t he c o u r s e o f which c a sh of R s . 3 2 , 6 5, 2 7 0 /- was f ou n d from the r e s i d e n t i a l p r e mi s e s o f t h e a s s es s e e o u t o f w h i c h R s . 3 0, 5 0 0 , 0 0 0 / - w a s sei z e d f r om t h e gr o u p . . Th e a s ses s e e w h en a s k e d t o e x p l a i n t h e s o ur c e of t h e c as h f o un d , i n hi s s t a t e m e n t r ec o rd e d u / s 1 3 2 ( 4 ) o f t h e A c t s t a t ed t h a t t h e c a s h a m o u n ti n g t o R s . 9 , 6 5, 2 7 0 / - w a s t h e c a s h i n h a n d o f all persons and concerns of the group, detail of which was a l s o f i l e d . Th e ba l a n c e u ne x p l a i ne d c a s h o f R s .2 3, 0 0 , 0 0 0 / -
( 3 2 , 6 5 , 2 70 - 9 , 65 , 2 7 0 ) w a s s ur r en d e r e d by t h e as s e s s e e a s under:
S h r i P a w an S a h ni ( a s s e s se e ) R s . 1 5 , 0 0 ,0 0 0 / -
S h r i G i ri s h S a hni R s . 2 , 5 0 ,0 0 0 / -
S h r i M a n o j S a h ni R s . 5 , 5 0 ,0 0 0 / -
10. Th e o f f e r o f t h e a d d i t i o n a l i n c om e w a s m a d e i n t h e r e t u r n f i l e d u / s 1 5 3 A o f t h e A c t w h i c h w a s ac c e pt e d a l s o b y t h e R e v e n ue . H o w e v e r , , pe n a l t y p r o c e e d i ng s w e re i n i t i a ted u / s 2 7 1 A A A o f th e A c t s t a t i n g t ha t s i n c e t h e a s s es s e e c o u l d n o t s p e c i f y t h e m a n n e r o f e a rn i n g t h e u nd i s cl o s e d c a s h s u r r e n d e re d b y h i m d u ri n g s e a r ch . Th e r e a f t e r t h e o r d e r w as p a s s e d l e v y i ng pe n a l t y @ 1 0% o f t h e c a s h s u r r en d e r e d as p e r t h e p r ov i s i o ns o f s e c t i on 2 7 1A A A o f t h e Ac t fo r t h e s a i d r e a s o n . Th e L d .C I T( A ) u p h el d th e o r d e r o f t h e A . O . Th e r e l e v a n t f i n d i n gs o f t h e L d . CI T( A ) u p h o l d i ng th e l e v y o f p e n a l t y at p a r as 3 . 4 t o 3 .6 o f t h e o r d e r i s a s u n de r:
"3.4 During the search proceedings, the appellant had voluntarily surrendered Rs.23,00,000/- as additional income, which was included in the total surrender of Rs.3,00,00,000/- made by the group.
3.5 Further, the appellant had offered additional income of Rs.15,00,000/- made in the return u/s 153A. The AO has imposed penalty of Rs.1,50,000/- u/s 271AAA of the Act on the ground that the appellant had failed to specify the manner of earning the undisclosed income. 6 3.6 It is apparent from the case, that the appellant had not disclosed income of Rs.15,00,000/- which relates to the 'Specified Previous Year' in the course of Certified True Copy the search in a statement u/s 132(4) of the Act had not admitted this undisclosed income nor specified the manner in which such income has been derived as mandated in sec 271AAA(2)(i) of the Act to get immunity from Penalty u/s 271AAA.
In view of the above discussion, penalty u/s 271AM of the Act amounting Rs.1,50,000/- is sustained."
11. A g g r i e v ed b y t he s a m e , t h e a s se s s e e h a s c o m e u p i n a p p e a l b e fo r e u s. D u r i n g t h e c ou r s e o f h e a ri n g before us t h e L d . co u n s e l f o r a s s es s e e ma d e h i s su b m i s si o n s d a t ed 4.9.2018 in wr i t i n g and r e l yi ng upon the sam e a r g u ed b e f o r e us t h at th e o r d e r o f t h e CI T( A ) c o n f i r m i n g l e v y o f p e n a l t y wa s b a d o n v a r i o us c o u nts a s u n d er :
1) since the as s e s s e e had c om p l i e d wi t h al l the c o n d i t i o ns s p e c i f i e d u / s 2 7 1 A AA s u b - s e c t i o n ( 2 ) f o r grant of i m m u ni t y from levy of penalty under t he s e c t i o n b y m ak i n g t h e s u r r e nd er d u r i n g t h e sea r c h s p e c i f y i ng t h e am e n d m e n t o f e a rn i n g t h e sa i d c as h as b e i n g o n a c co u nt o f a d v a n c es r ec e i v e d a g ai n s t sa l e o f c e r t a i n p r o p e rt i e s w h i c h d i d no t m a t u re , w h i ch w a s d e c l a r e d i n t he r e t u r n o f i n c om e f i l e d p o s t se a r c h , t a x e s a n d i n t e r es t p a i d th e r e o n a n d w h i c h s u r r en d er was a c ce p t e d by the A.O. a l s o. O u r a t t e n ti o n was d r a w n t o t h e s urr e n d e r l e t te r s p ec i f y i n g t h e m ann e r o f e a r n i n g t he i n c om e p l a c e d at P a pe r B o o k p a ge N o .2 3 a s under:
"T h at o u r o f to tal c as h o f Rs . 3 0 l ac s s e iz e d d u r in g th e s e ar c h / s u r v e y, R s . 2 3 l ac s was o n ac c o u n t o f ad v an c e r e c e iv e d ag ai n s t c e r ta i n p r o p e r ti e s an d th e s a me n o t g e tti n g ma tu r e d an d h e n c e b e in g 7 s u r r e n d e re d in th e ab s e n c e o f p r o p e r d e tai l s . B al an c e c as h o f R s . 7 l ac s i s d u l y ac c o u n te d f o r in th e b o o k s of ac c o u n t an d h e n c e th e s a me is n o t b e in g s u r r e n d e red . "
2) Th a t t h e A . O . wa s f a c t u a l l y w r on g i n m e n t i on i ng t h a t t h e a s s e s se e h a d n o t s p e c i f i e d t h e m a n ne r i n w h i c h t h i s i n c om e w a s e ar n e d w h i c h i s e v i d e nt f r o m t h e s u r r e nd e r l et t e r a s p o i n t e d o u t a b o v e an d w h i c h s t o o d a c ce p t e d by t h e D e pa r t m e nt a l s o .
3. Th a t t h e CI T( A ) w a s f a ct u a l l y i nc o r r e c t i n st a t i ng t h a t t h e s u r r end e r o f c a s h w a s n o t d i s c l o s e d i n t h e course of s e a r ch when the f ac t was that it was s u r r e n d e re d o n l y d u r i n g s e a rc h a n d h a d a l s o w ro n g l y h e l d t h a t t h e man n e r o f e a r n i n g h a d n o t b e e n s pec i f i e d b y t h e a ss e s s e e.
4) Th a t o n i d e n t i c a l s e t o f f a c t s o n t h e b a s i s o f s a m e s u r r e n d e r l e t t er , t h e a s s es s e e ' s b r o t h e r , S h r i G i r i s h S a h n i h a d s ur re n d e r e d R s .2 , 5 0, 0 0 0 / - e x pl a i n i ng t h e s a m e s o u r c e a nd s a m e m a n n e r an d s i m i l a r p e na l t y h a d been levied on him also which was s u bs e qu e n t l y d e l e t e d i n a pp e al b y th e CI T( A ) on t h e ba s i s o f e xa c t l y same e x p l a na t i o n of same so u r c e , m a n ne r and s p e c i f i c at i o n . Ou r a t t e n t i on w a s d r a w n t o t h e o rd e r o f t h e CI T( A ) i n t he c a s e o f S hr i Gi r i s h S a h ni p l a ce d a t P a p e r B o ok p a ge N o . 3 9 da t e d 9 . 6 . 2 0 1 7 d e l e t i ng t h e p e n a l t y l ev i e d o n c a s h s u r r en d e r ed o f R s . 2 ,5 0 , 0 0 0/ - at p a r a s 3 . 4 t o 3 .6 a s u n d e r :
"3.4 During the search proceedings, the appellant had voluntarily surrendered Rs.2,50,000/- as additional 8 income, which was included in the total surrender of Rs.3,00,00,000/- made by the group.
3.5 Further, the appellant had offered additional income of Rs.2,50,000/- made in the return u/s 153A. The AO has imposed penalty of Rs.25,000/- u/s 271AAA of the Act on the ground that the appellant had failed to specify the manner of earning the undisclosed income. 3.6 It has been submitted by the appellant that it is a settled law that where surrender amount stands offered in the return and taxes and interest stand paid, then no penalty should be levied for technical reasons. It has further been submitted that if the assessee answers the questions raised by the search party regarding surrender amount, it should be deemed that he has completed all his obligations relating to surrender amount and if there is any deficiency, including which may be specifically for not addressing the specific issue by the search party, the assessee cannot be faulted. Reliance placed on following judicial pronouncements.
a) CIT vs. Sudhir Jain 41 Taxrnann.com 234 (Delhi HC)
b) Sunil Kumar Bansal vs. DCIT 70 SOT 137 (Chd Trib)
c) ACIT vs. Munish Kr, Goyal 152 ITD 458 (Chd Trib)"
I agree with the appellant's contention in view of the judicial pronouncements relied upon which are applicable to the case of the appellant and hence penalty on Rs. 2,50.000 amounting Rs. 25,000 is also deleted.
In view of the same, Penalty of Rs. 69,557 imposed by the AO is deleted.
As a result, appeal of the appellant is allowed."
5) Th a t i n t h e c a s e o f M /s D e v B ho o m i A p ar t m e n ts ( A O P ) ( Gr o u p con c e r n ) s ur r e n d er o f R s . 25 , 0 0 , 0 00/ - f o r w o r k i n p r o g r e s s m a d e v i d e t h e s a m e s u r r e n d er l e t t er o n w h i c h p e na l t y u / s 2 7 1 A A A ha d b e e n l e v i e d wa s a s o d e l e t e d b y t h e C I T( A ) v i d e h i s o r d e r d a t e d 9 . 6 .2 0 1 7 . O u r a t te n t i o n wa s d r a wn t o t h e f i n d i ng s o f t h e C I T( A ) i n t h e s ai d c a se a t p a r a 4. 3 ( b ) a s u n d e r :
94.3 (b) With regard to penalty on Rs. 25,00,000/- surrendered u/s 132(4) as WIP, it has been stated by the appellant that it is a case where the assessee surrendered the amount, included the same in the return, also explained the manner of deriving such undisclosed income and also paid taxes thereon. Thus, the appellant satisfied all the conditions of sec 271AAA(2) of the Act and hence penalty should not be levied. It has further been submitted that during search as well as during post search period, whatever and whenever any questions were asked including in statement u/s 132(4) of the Act, the appellant always replied fully and completely & relied on judicial pronouncements including CIT. vs. Sudhir Jain 41 Taxrnann. Com 234 (Delhi HC) and Sudhir Kumar Bansal vs. DCIT 70 SOT 137 (Chd. Tribunal) I agree with the contentions of the appellant There is no reason to levy penalty on this surrendered amount in view of the provisions of the Act and the judicial pronouncements on this issue. In view of the same, penalty on surrendered value amounting to Rs. 25,00,OOO/- is also deleted."
6) W i t h o u t p r e j u di ce t o th e a bo v e co n t e n t i o n w h e re s u r r e n d e re d a m ou n t s t o o d o f f e r ed i n t h e r et u r n , t a x es a n d i n t e r e st s t oo d p a i d a n d t he m a n n e r o f e ar n i n g s t o o d e x p l a i n e d , n o p e n a l t y w a s l e v i a b l e u /s 2 7 1 AA A o f t h e A c t . R e l i a n ce w a s p l a c e d o n v a r i o u s d e c i s i on s o f the Hon'ble High Court an d the Tr i b u n a l in this regard. Th e s ub m i s s i o n s filed by the a s s es se e are b e i n g p r od u c e d h e r e u n d e r:
PENALTY U/S 271AAA Rs.1,50,000/- @10% ON CASH SURRENDERED Rs. 1,50,000/-
ONE
- Search on the group u/s.132 on l 1.09.09 (A.Y. 2010-1 1)
- Cash of Rs. 30,00,000/- was seized from the group
- Out of this cash of Rs.23,00,000/- was surrendered u/s.132 (4) as under:-
• Pawan Sahni (Assessee) Rs. 15,00,000/-
• Girish Sahni Rs.2,50,000/- • Manoj Sahni Rs. 5,50,000/-
- The assessee also explained the source as "business income" and also the manner as "on account of advance received against certain properties and the same not getting matured and hence being surrendered in the absence of proper details"10
- Thus, the surrender was made during search, the manner was also suo moto furnished and it was substantiated also and the A.O. duly accepted the same as and in the manner as surrendered by the assessee
- Thus he substantiated the manner of earning the said income also
- Rs.15,00,000/- were declared in the return filed post search and the surrender was also accepted
- The assessee also paid taxes and interest thereon as per law
- Hence, all conditions vide sec.271AAA (2) stood satisfied for not levying penalty u/s. 271AAA.
TWO
- The A.O. has been factually wrong in mentioning that the assessee had not specified the manner in which this income was earned
- The manner was duly specified in the surrendered letter as detailed above
- The surrender stands accepted THREE
- CIT (A) wrongly held that Rs. 15,00,000/- was not disclosed in the course of search while it was surrendered only during search
- CIT (A) also wrongly held that manner has not been specified while it was duly specified as given in Pg.23 of the paper book FOUR
- Exactly on similar facts, on the basis of same surrender letters, Sh. Girish Sahni (brother) also surrendered cash of Rs.,2.5 lacs explaining the same source and same manner and similar penalty has been levied on him also
- However, same CIT (A), vide same dated order i.e. 15.06.17. deleted the penalty of Rs, 25, 000/- on surrender of Rs.2,50,000/- on the basis of exactly same/common explanation of source, manner and its substantiation FIVE
- M/s Dev Bhoomi Apptt. AOP (group concerned) also surrendered Rs.25,00,000/- for WIP vide same surrender letter
- Same Ld. CIT (A) vide order dtd.09.06.17 deleted the penalty on said amt.
- SIX - Without Prejudice
- Where surrender amt. stands offered in the return, taxes and interest stands paid and the manner stands explained, no penalty U/S.271AAA can be levied CASE LAWS CIT VS. SUDHIR JAIN 41 TAXMANN.COM 234 (DELHI HC) Section 271AAA, read with section 69, of the Income-tax Act, 1961 - Penalty - Where search has been initiated [Conditions precedent] - A certain sum was surrendered as undisclosed income by an AOP at time of search 11
- Taxes and applicable interest were paid on undisclosed income and manner of earning was recorded in statement of one of members of AOP that income was derived from trading transactions not recorded in books - Whether penalty under section 271AAA could not be imposed - Held, yes [Para 7] [In favour of assessee] SUNIL KUMAR BANSAL VS..DCIT 70_SQT 137 (CHD. TRIE) IT : Where no question was asked during statement recorded under section 132(4), in Respect of manner of earning income surrendered, assessee could not be expected to substantiate same later on; penalty could not be levied under section 271AAA. 1`432ACIT VS. MUNISH KUMAR GOYAL 152 ITD 453 (CHD. TRIE) Section 271 AAA of the Income-tax Act, 1961 - Penalty - Where search has been initiated (Applicability of) - Assessment year 2010-
11 - Where assessee having surrendered certain income in course of search, filed return wherein said amount was duly disclosed and taxes were paid accordingly, there was sufficient compliance of provisions of section 271 AAA (2) and, thus, impugned penalty order deserved to be set aside - Held, yes [Para 10] [In favour of assessee] NEERAT SINGAL VS. ACIT 161 TTJ (DEL.) (TRIE.) 483 Penalty u/s. 271 AAA - Conditions precedent - Surrender of income vis- a-vis matter of earning - In the absence of query raised by the AO during the course of recording of statement u/s. 132 (4) about the manner in which the undisclosed income has been derived about its substantiation, the AO was not justified in imposing penalty u/s. 271 AAA specially when the offered undisclosed income has been accepted and due tax thereon has been paid by the assessee. PRAMOD KR. JAIN VS. DCIT (2012) 77 DTR (CTK.) (TRIE.) 244 Assessee having surrendered certain income for the relevant Asstt. Years in the statements during the course of search and filed returns declaring the same pursuant to notice U/s. 153 A which has been accepted by the AO, levy of penalty U/s. 271 AAA was not justified on the ground that the assessee has made disclosure but failed to specify the manner in which such income has been derived. ASHQK KR. SHARMA VS. DCIT (2012) 77 DTR (CTK.) (TRIE.) 241 Assessee having disclosed concealed income while giving statement U/s. 132 (4) during the course of search and paid tax thereon and showed the said undisclosed income in the return under the head "income from business" which has been accepted by the Deptt., penalty U/s. 271 AAA is not leviable."
12. Th e L d . c o u n s e l f o r a s s e s s e e, t h er e f o r e , c o nt e n d ed t h a t the a s s e s se e ha v i n g c o m pl i e d with all the c o n d i t i on s s p e c i f i e d f o r g r an t o f i m m u ni t y u / s 2 7 1A A A su b- s e c t i o n ( 2) o f t h e A c t a nd t he C I T( A ) h av i n g h i m s e l f d el e t e d th e p e n a l t y levied in i d en t i c a l c i r cu m s t a nce s in th e c a se of o t he r a s s e s s e e s of t h e s a m e g r o u p a nd i n r e l a t i o n t o t h e s a m e 12 s u r r e n d e r m a d e , t h e r e w a s n o ca s e o f l e v y o f pe n a l t y u / s 2 7 1 A A A o f t h e Act .
13. Th e L d . D R , o n th e o t h e r h an d , re l i e d u p o n t h e or d e r s o f t h e A . O . a n d t h e C I T( A ) e m ph a s i z i n g t ha t t he a s s e s s ee had failed to sp e c i f y the ma nn e r of earning the ca s h s u r r e n d e re d .
14. We have heard rival c o n t e n t i on s and perused the o r d e r s o f t h e a ut h o r i t i e s be l o w . W e a r e c o n v i n ced w i t h t h e a r g u m e n t s o f t he L d . c ou n s e l f or a s s e s s ee t h at th e p r e s e nt i s n o t t h e fi t c a se f o r l e v y of p e na l t y u / s 2 71 A A A o f t h e A c t . U n d i s p u t ed l y t he penalty has been levied on the cash s u r r e n d e re d b y t h e a s s es s e e o f R s . 1 5 l ac s . Ad mi t t e d l y t h e a s s e s s e e i n i t s s u r r e n d e r l et t e r a s r e p r o d u c e d a b o v e , h a d e x p l a i n e d t he s ou r c e o f e a r n i ng t h e s a i d c a s h a s b e i n g o n a c c o u n t o f b us i n e s s r e ce i p t a g ai n s t c er t a i n p r op e r t i e s a n d the same not ge t t i n g ma t u r e d. Th e aforesaid s u r r e n de r u n d i s p u t ed l y w as a c c e p t e d b y t he A . O . a n d wa s re f l e c t e d i n t h e r e t u r n of i nc o m e f i l e d by t he a s s e s s e e an d t a x e s p a i d t h e r e o n . Th e R eve n u e a u t ho r i t i es h a v e l e v i e d p e nal t y f o r t h e r e a s o n t h a t t h e a s s e s s e e f a i l ed t o s p e c i f y t h e m a n n e r o f e a r n i n g t h e s urr e n d e r e d i n c o me/ c a s h . Th i s fi nd i n g a s i s e v i d e n t f r o m t h e f a c t s s t a t e d a b ov e i s a n i n c o r r e ct f i n d i n g. S i n c e th e s ur r en d e r l et t e r d u l y s p e c i fi e d th e m a n n e r of e a r n i n g t h e s u rre n d e r e d c a s h . A l s o a s r i g h t l y po i n t e d o u t by the Ld. c ou n s e l for a s s e ss e e the o th e r c o n d i t i o ns s p e c i f i e d fo r g r an t o f i m m u n i t y fr o m t h e l e v y o f pe n a l t y u /s 2 7 1 A A A s t o od f ul f i l l e d b y th e a s se s s e e b y w a y of m a k i n g t he 13 impugned su r r en d e r in the sta t e m e n t m ad e during the c o u r s e o f se a r c h, r e t u r n i ng t h e sa m e a s i n c om e an d p a y i ng t a x e s th e r e o n. M o r e o v e r a s r i gh t l y p oi n t e d o u t b y th e L d. counsel f or as s e s s e e in i de n t i c a l s et f ac t s and c i r c u m s t an c e s th e L d . CI T( A ) h a d d e l e t e d t h e l e v y o f p e n a l t y i n t h e c a se o f S hr i G i r i s h S a h n i , t h e b r o t h er o f t he a s s e s s ee w h o h a d m a d e su r r e n d e r o f Rs . 2, 5 0 , 0 0 0 / - c a s h e x p l a i n i ng t h e s o u r c e t o b e t h e s a m e a s i n th e c a s e o f t h e a ss e s s e e a n d a l l o t h er c o n di t i o n s a l s o b e i n g i d e n t i c a l t o t ha t i n t h e ca s e o f t h e a s s e s se e . S i m i l a rl y , i n t he c a s e o f M /s De v B h o o mi A p a r t m e n ts ( A O P ) t h e p e n al t y l e vi e d o n t h e s u r r en d e r m a d e o n a c c o u n t o f W I P w h i c h w as a l s o d u l y e x pl a i n e d i n t he s u r r e n d e r l e t t e r f i l e d a n d i n c l u de d i n t h e r e tu r n o f i n c o me a n d t a x e s p a i d th e r e o n w er e a l s o d e l e t e d by t h e C I T( A ) . The facts and ci r cu m s t a n c e s i n v ol v e d in t h es e cases are i d e n t i c a l to t h a t i n t h e c a s e o f t he a s s e s s e e . Th e L d . D R h a s b e e n u n a b l e to p o i n t o u t a n y di f f e r e n t i a t i n g f a cts . Th e r e i s n o r e a s on w h y th e CI T( A ) t o ok a t o t a l l y d i ve r g en t v i e w i n t h e p r e s en t c a se a n d c o n f i r m e d the l e v y of p e n a l t y .
I n v i e w o f t h e a b o v e f a ct s a n d c i r c u m st a n c e s o f t h e c a s e , w e ho l d th a t t h e a ss e s s ee h a v i n g de m o ns t r a t e d to h a v e f u l f i l l ed a l l t h e co n d i t i o n s fo r g r a n t o f i m mu n i t y fr om l e v y o f p e n a l t y u/ s 2 7 1 A A A a s s pe c i f i e d i n s u b -s ec t i o n ( 2 ) o f t h e s e c t i on i n c l u d i n g s p e ci f y i n g t h e m a n n e r of e a r n i n g t he s u r r e n d e re d i n co m e , a n d h a v i ng d e l e t ed p e n al t y l e v i e d i n i d e n t i c a l s e t o f fa c t s i n c a se o f ot h e r a s s e ss e e s of t h e s a me group, the CI T( A ) was wrong in confirming t he levy of 14 penalty in the present case. Th e penalty so levied i s, t h e r e f o r e, d i r ec te d t o b e d e l e t ed .
Th e a p p e a l o f the a s s e s s ee i s , t he r e f o r e , a l l o we d . I T A N o . 1 37 2 / C hd / 2 0 1 7 :
15. Th e i s s u e i n t h i s c a s e r e l a t e s to l e v y o f p en a l t y on t h e cash s u r r e nd e re d by Shri Ma n o j Sahni a mo u n t i n g to R s . 5 , 5 0 , 00 0 / - . Si n c e i t w a s co mm o n g r o u nd t h at t h e f ac t s and c i r c u m s t anc e s leading to the levy of penalty and c o n f i r m a ti o n o f t h e s a m e b y t h e C I T( A ) w e r e i d e n t i c a l to t h a t i n t h e c a s e o f S h r i P a w a n S ah n i d e a l t w i th b y u s a b o v e i n I TA N o . 1 3 7 3/ C h d / 2 0 1 7, t h e d e c i s i o n r e n d er e d t h e r e i n w i l l s q u ar e l y a p pl y t o t h e pr e s e n t c a s e a l s o, f o l l owi n g w h i c h w e d e l e te t h e l e v y o f p e n al t y .
Th e a p p e a l o f the a s s e s s ee i s al l o w e d .
16. I n e f f e ct ;
1) Th e appeal of the assessee in I TA
N o s . 1 2 7 2 /C h d / 20 1 7 & I TA N o . 1 2 7 3 / C h d/ 2 0 1 7
are allowed.
2) Th e appeals of the Re v e n u e in I TA
N o . 1 9 4 / C hd / 2 0 14 , I TA N o . 3 7 /C h d / 2 0 1 7 , I TA
N o . 1 4 3 / C hd / 2 0 15 & I TA N o . 2 01 / C h d / 2 0 14 are
d i s m i s s e d.
O r d e r p r on o u n c ed i n t h e O p e n Cou r t .
दवा संह अ नपणा%
ू ग'ता
ु
(DIVA SINGH) (ANNAPURNA GUPTA)
याय,क सद"य/ Judicial Member लेखा सद"य/ Accountant Member
दनांक /Dated: 30th November, 2018
15
*रती*
आदे श क त*ल+प अ,े+षत/ Copy of the order forwarded to :
1. अपीलाथ / The Appellant
2. यथ / The Respondent
3. आयकर आय-त
ु / CIT
4. आयकर आय-त
ु (अपील)/ The CIT(A)
5. +वभागीय त न0ध, आयकर अपील#य आ0धकरण, च2डीगढ़/ DR, ITAT, CHANDIGARH
6. गाड फाईल/ Guard File आदे शानसार ु / By order, सहायक पंजीकार/ Assistant Registrar