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2015 (11) TMI 633 - AT - Income TaxPenalty under section 271(1)(c) - unexplained cash funds received from sale of the Bangalore property, and its utilisation for Pune property - Held that:- Money applied in acquisition of Pune properties was mainly out of money received from sale of shares of M/s. Ami Builders Pvt. Ltd. and S. K. Projects P. Ltd. No fault has been found by the Assessing Officer or the Commissioner of Income-tax (Appeals) in the above cash flow statement indicating one to one nexus between the cash funds received on sale of Bangalore property and utilisation for purchase of Pune property. Since all these income had been offered for tax, there cannot be double taxation on the same income one at a point of source and another at a point of application. Taxes have been paid on additional income out of sale of shares of M/s. Ami Builders Pvt. Ltd. and S. K. Projects P. Ltd. therefore, again there cannot be tax on the same income at the time of acquisition of property at Pune. In view of the above facts we may appreciate that declaring additional income of ₹ 40.35 crores as narrated in the letter dated December 8, 2011 filed before the lower authorities, covers each and every issue that has been pointed out during the search as well as post search proceedings. The assessee had paid taxes with a view to buy peace and to avoid litigations. As a matter of record group companies and their promoters have been filing return of income since more than two decades and also paying taxes thereon. It is also clear from the above statement so recorded by the Department under section 132(4) that cash component was there for the purchase of property at Pune. The said cash and cheque component was arranged and funded by the promoters of the company, namely, Sunil and Sneha Kotharis. The source of cash was made available from the sale proceeds on shares of M/s. Ami Builders Pvt. Ltd. and S. K. Projects Ltd. which was declared and offered for tax. In view of the cash flow statement as discussed above, the assessee has explained one to one nexus namely cash funds received from sale of the Bangalore property, and its utilisation for Pune property. The revised declaration of income so filed by the assessee was bona fide and voluntary and without detection of any irregularities found by the Department. The return was revised with a view to co-operate the Department and to buy peace and to avoid litigation. The disclosure was with a specific plea that no penalty proceedings be initiated under section 271AAA or 271(1)(c) of the Act. - Decided in favour of assessee.
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