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2016 (4) TMI 206 - AT - Income TaxPenalty u/s 271(1)(C) - income surrendered during the course of search - Held that:- any observation or finding recorded by the Assessing Officer in the assessment orders for all the four years under consideration, from which the satisfaction as required to be arrived at by him to initiate penalty proceedings under section 271(1)(c) is discernable. However, he has not been able to pinpoint any such observation or finding recorded by the Assessing Officer in this context. A perusal of the assessment order also shows that there is no such observation or finding given by the ld. CIT(Appeals) from which the satisfaction as required to be arrived at by the Assessing Officer is discernable. The decision of the Coordinate Bench of this Tribunal in the case of Suvaprasanna Bhattacharya (2015 (12) TMI 43 - ITAT KOLKATA) thus is clearly applicable in the present case and respectfully following the same, we hold that in the absence of the requisite satisfaction recorded by the Assessing Officer in the assessment order, the initiation of penalty proceedings itself was bad in law and the penalties imposed in pursuance of such initiation are not sustainable. It is also observed that the income surrendered during the course of search was declared by the assessee in the returns of income filed for three years under consideration, i.e. A.Y. 2004-05, 2005-06 & 2006-07 in response to the notices issued by the Assessing Officer under section 153A and the income so declared was accepted by the assessee without making any further addition. Thus penalty cancelled - Decided in favour of assessee
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