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13. As we have held that the penalty be deleted on the preliminary point, the other grounds raised by the assessee are not being dealt with as they become only academic.

ITA.No. 4943/MUM/2018 (A.Y. 2015-16):

14. Coming to the appeal of the assessee for the A.Y. 2015-16, assessee has raised the following grounds in its appeal: -

(1) In the facts and circumstances of the case and in law, the Ld.CIT(A) erred in confirming the penalty u/s. 271AAB of the Act in principle.

18. Ld. DR vehemently supported the orders of the Authorities below.

19. We have heard the rival submissions, perused the orders of the authorities below. In this case on a reading of the Assessment Order passed u/s. 143(3) of the Act for the A.Y. 2015-16 it is observed that search and seizure operation u/s. 132(1) was conducted on M/s.Geochem Laboratories Pvt. Ltd., on 11.11.2014. Consequent to this search operation the case of the assessee was also centralized with DCIT-(5)(1) for the purpose of assessments. The Assessing Officer completed the assessment u/s. 143(3) of the Act by making disallowance u/s. 14A r.w. Rule 8D and also interest on service tax. In the course of the assessment proceedings the Assessing Officer accepted the revised computation filed by the assessee reducing the WDV block of assets consequent to the adjustments made in the A.Y.2013-14 and A.Y. 2014-15. Assessing Officer also initiated penalty proceedings u/s. 271AAB of the Act and subsequently passed penalty order on 31.05.2017 levying penalty of ₹.2,83,200/- u/s. 271AAB(1)(c) of the Act. The penalty was sustained by the Ld.CIT(A).

ITA.NOs. 4941, 4942 & 4943/MUM/2018 M/s Coast Line Shipping (India) Pvt. Ltd.,

20. The provisions of section 271AAB read as under: -

"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, [but before the date on which the Taxation Laws (Second Amendment) bill, 2016 receives the assent of the President], the assessee shall pay by way of penalty, in addition to tax, if any, payable by him, - -

ITA.NOs. 4941, 4942 & 4943/MUM/2018 M/s Coast Line Shipping (India) Pvt. Ltd.,

21. As could be seen from the above, a plain reading of the provision suggests that penalty u/s. 271AAB of the Act is levied in a case where search has been initiated u/s. 132 of the Act on or after the first day of July, 2012. It is the contention of the assessee that no search has been initiated in its case u/s. 132 of the Act. We have perused the Assessment Order passed u/s. 143(3) of the Act on 30.11.2016 as well as the penalty order passed on 31.05.2017 u/s. 271AAB of the Act and found that the search and seizure operation u/s. 132 of the Act was conducted on M/s.Geochem Laboratories Pvt. Ltd., on 11.11.2014 and no where it is mentioned either in the assessment order or in the penalty order that search and seizure was initiated u/s. 132 of the Act in assessee's case. We have also perused the Assessment Orders for the A.Y. 2013-14 and A.Y. 2014-15 and found that search and seizure operation was conducted u/s. 132 of the Act on 11.11.2014 on M/s. Geochem Laboratories Pvt. Ltd., based on which the assessments were framed in assessee's case and nowhere in the Assessment Orders passed for the A.Y. 2013-14 and A.Y.2014-15 u/s. 153C of the Act, it has been mentioned that search was initiated in assessee's case. We also observed that penalty proceedings were initiated u/s. 271(1)(c) of the Act for the A.Y. 2013-14 and A.Y. 2014- 15 in assessee case. Therefore, we are of the view that for levy of penalty u/s.271AAB of the Act, the first and foremost condition to be satisfied is ITA.NOs. 4941, 4942 & 4943/MUM/2018 M/s Coast Line Shipping (India) Pvt. Ltd., that search u/s. 132 of the Act should have been initiated on the assessee for invoking the provisions of section 271AAB of the Act and levying penalty under this provision. Similar view has been taken by various Tribunals as referred to above. In the case before us since there was no search and seizure operation initiated u/s. 132 of the Act, the penalty proceedings initiated u/s.271AAB as against the provisions of statute. Thus, we quash the penalty order passed u/s. 271AAB of the Act for the A.Y. 2015-16.