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2018 (5) TMI 948 - AT - Income TaxPenalty u/s 271(1)(c) - assessment u/s 153A - Held that:- We find that the AO has taken cognizance of section 153C of the Act in the case of assessee for the assessment years 2007-08 and 2008-09. The action under section 153C could be taken against the assessee if any material was found during the course of search belonging to the assessee, and in the assessment proceedings of the searched persons, the AO of the searched person is satisfied with material found during the course of search belongs to other person and demonstrate escapement of income. Satisfaction action against other person can be taken in 153C proceedings. While adjudicating this aspect in the quantum appeal of the assessee, the Tribunal recorded a finding that no satisfaction was recorded in this case. In view of above order of the Tribunal quashing the assessment order for the assessment years 2007-08 and 2008-09 impugned addition on which penalty u/s 271(1)(c) gets extinguished. Further sub-clause (iii) of section 271(1)(c) provides mechanism for quantification of penalty. It contemplates that the assessee would be directed to pay a sum in addition to taxes, if any, payable him, which shall not be less than but which shall not exceed three times the amount of tax sought to be evaded by reason of concealment of income and furnishing of inaccurate particulars of income. Since basis for visiting the assessee with penalty has been extinguished by quashing the assessment order itself by the Tribunal in the appeal of assessee the impugned penalty in the present case has no leg to stand. - Decided against revenue
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