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2023 (8) TMI 26 - ITAT AHMEDABADPenalty u/s 271(1)(c) OR 271AAA - Addition of undisclosed income found during search proceedings - correct section for levy of penalty - HELD THAT:- As the requirements for levy of penalty under section 271AAA of the Act were – (i) search action should have been initiated after 1stJune, 2007, (ii) there is “undisclosed income” and (iii) the undisclosed income relates to a “specified previous year”. CIT(A) correctly noted that the assessee fulfilled first condition since search in the present case was conducted in February, 2011. He noted fulfillment of the second condition of there being undisclosed income noting that all income found in the case of the assessee represented by entries in books of accounts or other documents found during the search, unexplained jewellery and unexplained marriage expenses were included in the definition of undisclosed income as per the Explanation to the section. Fulfillment of the other condition, that the impugned assessment year qualified as “specified previous year” since as per the definition of “specified previous year” it included the year in which search was concluded, which he found was the fact in the present case. DR was unable to controvert the above findings of the Ld.CIT(A) - No infirmity in the order of the ld.CIT(A) holding that the correct section for levy of penalty in the present case was under section 271AAA and not section 271(1)(c) which was invoked by the AO. Decided against revenue. Whether mere invocation of incorrect section would not invalidate order? - AO had no power to levy penalty under section 271(1)(c) of the Act, which had been expressly denied by sub-section (3) of section 271AAA of the Act. Therefore, plea of the Revenue that the AO having power to levy penalty ,he could have exercised the same by levying either under section 271AAA or under section 271(1)(c) of the Act, we hold is wholly misplaced and contrary to law.
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