Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2019 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (11) TMI 637 - AT - Income TaxPenalty u/s 271AAB - whether it is mandatory or discretionary - income surrender on account of advance for land - HELD THAT:- Levy of penalty U/s 271AAB is not mandatory but the AO has to take a decision on the basis of relevant facts of the case and after considering the reply of the assessee whether the surrender made by the assessee falls in the definition of undisclosed income as defined in the explanation to Section 271AAB(1) of the Act. Accordingly, following the earlier decision of this Tribunal we hold that the penalty U/s 271AAB of the Act is discretionary and not mandatory. It is not an automatic as a consequence of surrender of income by the assessee but the conditions precedent as provided U/s 271AAB are to be satisfied for levy of the penalty. Therefore, the finding of the ld. CIT(A) that the penalty is mandatory in nature is not sustainable and the same is set aside Without going into the controversy whether these entries are artificial or actual payment made by the assessee when there was no asset actually acquired by the assessee or possessed by the assessee then the mere notings of payment being advanced for land cannot be held as undisclosed income of the assessee. The Revenue has not made any efforts to ascertain the correct and proper particulars of the land and the person to whom the alleged payment was made by the assessee. Nothing has been brought on record to show that the assessee has finally acquired these lands by executing some documents or title deeds. When there is no acquisition of land then in the absence of the corresponding asset acquired by the assessee the mere noting of the advance which is out flow of the funds cannot be held as undisclosed income. In SHRI RAJA RAM MAHESHWARI VERSUS THE DCIT, CENTRAL CIRCLE-3, JAIPUR. [2019 (1) TMI 1546 - ITAT JAIPUR] Tribunal has consistently held that mere entries of advance for land cannot be treated as undisclosed income. Accordingly, following the decision of the Coordinate Bench and maintaining the rule of consistency we hold that the penalty U/s 271AAB is not sustainable in respect of the income surrender on account of advance for land because of alleged transactions do not fall in the ambit of undisclosed income as defined in explanation to Section 271AAB(1) of the Act. Accordingly the penalty levied U/s 271AAB is in the case of the assessee is deleted. - Appeal filed by the assessee is allowed.
|