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2022 (6) TMI 563 - AT - Income TaxPenalty imposed u/s 271AAA - cash found in search as well as the unexplained jewellery - search and seizure operation un/s 132 was conducted on the assessee, wherein, information was found that the assessee was operating a foreign bank account at HSBC Geneva - cash found in search seized - as per revenue the assessee would not have surrendered the cash found had search and seizure operation not taken place - HELD THAT:- Penalty under section 271AAA(1) cannot be imposed in a case where the assessee has offered the undisclosed income in the statement recorded under section 132(4) of the Act, specifying the manner in which such income has been derived and if the assessee pays the tax along with interest of such income. In the facts of the present case, undisputedly, the assessee has offered the cash found as income in the statement recorded under section 132(4) of the Act. It is also a fact that the assessee has paid the tax on such income. The only condition, according to the department, which has not been fulfilled is the assessee has not specified the manner in which such income has been derived. On a perusal of the statement recorded under section 132(4) of the Act, we have observed that in response to a question asked by the authority concerned, the assessee came forward to offer the money found in the bank account as well as in cash as income. It is observed, the authority recording statement did not pose any specific query to the assessee to explain the mode and manner in which such undisclosed income was derived. Thus, in course of search and seizure operation when the assessee came forward and offered certain income to show his bonafide and ultimately followed it up by actually offering such income to tax, in our view, the assessee should be given the benefit of the exceptions provided under sub-section (2) of section 271AAA. In any case of the matter, it is a fact on record that the assessee is no more and has been substituted by his legal heir, in course of proceeding before us. Thus we delete the penalty imposed under section 271AAA of the Act. Grounds of assessee are allowed.
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