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2019 (12) TMI 688 - AT - Income TaxLevy of penalty u/s 271AAB(1)(a)(ii) - During the course of search, the Investigation team found incriminating material in the form of a note in I-pod with regard to rate quoted by the assessee for sale of plots @₹ 4,600/- per square yard which was seized in the office and also in the residential premises of the partners / directors of the assessee firm - HELD THAT:- Though the incriminating material was found indicating sale of plots at ₹ 4,600/- per sq.yd. the assessee admitted the income @3,700/- for Sunray Village and ₹ 2,700/- for Sunray Beach Front after deducting the expenditure which was paid outside the books of accounts and the AO had accepted the admission made by the assessee and completed the assessment. From the assessment order and the penalty order, we find that the assessee had explained the manner in which the additional income was admitted stating that the plots were sold @2,700/- and ₹ 3,700/- per sq.yd and the sale consideration was recorded at the rate lesser than the sale consideration accounted in the books of accounts. No evidence was brought on record by the revenue to show that the contention of the assessee was incorrect. In fact the revenue has accepted the submissions made by the assessee and completed the assessment on the disclosure made by the assessee. Therefore, we hold that the assessee has satisfied the conditions laid down u/s 271AAB for levying penalty @10% which the Ld.CIT(A) has upheld. Therefore, we do not find any reason to interfere with the order of the Ld.CIT(A) and the same is upheld. - Decided against revenue Penalty u/s 271AAB and 271F - assessee admitted the additional income of ₹ 2.00 crores for the assessment year which was accepted by the department and completed the assessment estimating the income @18% on gross contract receipts before depreciation - AR argued that the AO should have initiated penalty u/s 271(1)(c) - A.Y.2014-15 - HELD THAT:- Though in the earlier years, the assessee had admitted the additional income on the net consideration received, in the year under consideration the admission was only towards estimated profits for future period i.e. from 01.04.2013 to 31.04.2014. The AO also completed the assessment estimating the income @18% rejecting the books of accounts of the assessee company before depreciation. No material was also brought on record to support the estimation of income @18% on gross receipts. Though the AO completed the assessment on estimation of income, penalty was initiated u/s 271AAB instead of 271(1)(c). From the material gathered, submissions made by the assessee and from the records, we are of the considered view that no material was available with the department to hold that there was undisclosed income for the previous year ending 31.03.2014 till the date of search. Thus, there is no case for levying the penalty u/s 271AAB and we do not find any reason to interfere with the order of the Ld.CIT(A). Accordingly, the appeals of the revenue as well as the cross objections filed by the assessee are dismissed.
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