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2014 (10) TMI 494 - AT - Income TaxPenalty u/s 271AAA - Undisclosed income in pursuance of search - particulars of transactions furnished or not – Held that:- U/s 132 (4) of the Act unless the authorized officer puts a specific question with regard to the manner in which income has been derived, it is not expected from the person to make a statement in this regard and in case in the statement the manner in which income has been derived has not been stated but has been stated subsequently, that amounts to the compliance with Explanation 5 (2) of the Act - in case there is nothing to the contrary in the statement recorded under section 132 (4) of the Act, in the absence of any specific statement about the manner in which such income has been derived, it can be inferred that such undisclosed income was derived from the business which he was carrying on or from other sources - The object of the provision is achieved by making the statement admitting the non-disclosure of money, bullion, jewellery, etc. - much importance should not be attached to the statement about the manner in which such income has been derived - mere non-statement of the manner in which such income was derived would not make Explanation 5(2) inapplicable. Penalty u/s 271AAA is not leviable if an assessee, in his statement recorded during the search u/s 132 of the Act, admits the undisclosed income, specifies and substantiates the manner in which it has been derived and pays the taxes due thereon, together with interest - the assessee has paid due tax on the admitted undisclosed income - there is no specific format/procedure prescribed in the Act for specifying and substantiating an undisclosed income - The statement of the assessee, specifying the manner in which the undisclosed income was derived and substantiated, did not face any rebuttal or rejection at the hands of the AO - the assessee had entered into various transactions of sale/purchase of land during the concerned period - The income arising out of the transactions was declared - This included the undisclosed amount - the assessee has substantiated the manner in which the undisclosed income was derived and that being so, the condition laid down by Section 271AAA (2) (ii) has been duly met - CIT (A) erred in deciding this issue against the assessee – Decided in favour of assessee.
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