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2015 (9) TMI 278 - AT - Income TaxPenalty levied u/s. 271(1)(c) - reopening of assessment - addition of the entire on-money amount in the hands of the assessee - CIT(A) deleted penalty - Held that:- In the present case, reassessment proceedings were initiated on the basis of incriminating document found against the assessee during search proceedings in the case of Luthra Group. Thus, the right course of action for the Revenue is to initiate proceedings u/s. 153C and not u/s. 148 of the Act. Our view is supported by the decision of Amritsar Bench of Tribunal in the case of ITO Vs. Arun Kumar Kapoor (2012 (6) TMI 403 - ITAT AMRITSAR ), wherein, under similar circumstances the Tribunal has held that the proceedings u/s. 148 are illegal and void ab initio. Since, the substratum for making addition is itself bad in law, no penalty can be levied on such addition. Commissioner of Income Tax (Appeals) has deleted the penalty on the ground that the amount of on-money received as advance by the assessees from the prospective customers of the plots is to be taxed in the year of sale of plots. We do not find any error in the findings of the Commissioner of Income Tax (Appeals). - Decided in favour of assessee.
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