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2018 (2) TMI 974 - AT - Income TaxPenalty u/s 271AAA - assessee offered additional income during search - Held that:- Penalty under section 271AAA of the Act can be levied only for the ‘specified previous year’ which is clearly defined by Explanation (b) to section and is limited to the said assessment years only. In the present case, search on the premises of assessee was carried out on 25.08.2011 and hence, the year of search is assessment year 2012-13. The years which are in appeal before us are relate to assessment years 2006-07 to 2010-11. Admittedly, none of the assessment years are the years of search. Secondly, the second condition of the due date for filing the return of income having not expired under section 139(1) of the Act is not applicable to assessment years 2006-07 to 2010-11 where the assessee was due to file the return of income us 139(1) of the Act much before the date of search. The assessee claims that it had furnished the said returns of income for the respective years before the date of search and the time limit prescribed under section 139(1) of the Act had already expired. Thus we hold that where the assessee though during the course of search had offered additional income, which was declared in the return of income in response to notice under section 153A of the Act; however, in view of specific definition of ‘specified previous year’, the rigours of section 271AAA of the Act are not attracted for assessment years 2006-07 to 2010-11. Accordingly, we hold so. Thus, the assessee is not liable for levy of penalty under section 271AAA of the Act for the said assessment years. Accordingly, we uphold the order of CIT(A) in deleting penalty levied under section 271AAA of the Act, though on different grounds. - Decided in favour of assessee. CIT(A) failure to exercise his coterminous powers in not initiating the penalty u/s 271(1)(c) after deleting penalty levied u/s 271AAA - Held that:- We find no merit in the plea of Revenue since before initiating penalty proceedings under section 271AAA and / or 271(1)(c) of the Act, clear satisfaction has to be recorded by Assessing Officer as to which section is attracted in the facts of case. Sub-section (3) to section 271AAA of the Act very clearly provides that no penalty under the provisions of section 271(1)(c) of the Act shall be imposed upon assessee, in respect of undisclosed income which is referred to in sub-section (1) to section 271AAA of the Act. Once the Assessing Officer has taken the step of initiating penalty under section 271AAA of the Act in respect of additional income offered consequent to search, then the Assessing Officer or any of the authorities below are precluded by provisions of the Act itself to initiate any action for levy of penalty under section 271(1)(c) of the Act. Accordingly, we hold so. - Decided against revenue
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