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2020 (1) TMI 246 - AT - Income TaxPenalty u/s 271(1)(c) - income surrendered by the assessee during survey as well as addition made during the course of assessment framed u/s 143(3) - HELD THAT:- At the outset, it is to be noted that the Explanation 5A to the section 271(1)(c) is relevant only when there is a search and seizure action under section 132 of the Act carried out after 1st June, 2007 and consequently during the course of search and seizure action if assessee is found to be owner of money, bullion, jewellery and other valuables or any income based on the entries in the books of account etc. then notwithstanding that such income is declared by the assessee in the return of income furnished on or after the date of search for the purpose of section 271(1)(c), he shall be deemed to have concealed the particulars of income or furnished inaccurate particulars of income. Therefore, the applicability of Explanation 5A is exclusively in the case of search and seizure action under section 132 of the Act and the said deeming provision cannot be applied in the case of survey conducted under section 133A of the Act. Concealment of particulars of income or furnishing of inaccurate particulars of income by the assessee has to be in the income tax return filed by it. Even if some discrepancies were found during the survey resulting in surrender of income by the assessee, once the assessee has declared the said income in the return of income filed under section 139(1) of the Act, then the penalty cannot be levied on the surmises, conjectures and possibilities that the assessee would not have disclosed the income but for survey. Accordingly, following the earlier decision of this Tribunal as well as the decision of Hon’ble Delhi High Court in case of CIT vs. SAS Pharmaceuticals [2011 (4) TMI 888 - DELHI HIGH COURT] the penalty levied by the AO and confirmed by the ld. CIT (Appeals) in respect of the amount of ₹ 3 crore is not sustainable, the same is deleted.- Decided in favour of assessee.
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