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2021 (9) TMI 387 - AT - Income TaxPenalty levied u/s 271AAB - conversion of survey action into search - detection of undisclosed income u/s 133A or u/s 132 - disclosure of additional income - excess stock of diamond and its incomplete record in the books of account and other documents maintained in the normal course of assessee’s business - HELD THAT:- CIT(A) was of the view that there was excess stock of finished diamond of 137.01 carat only, which was not recorded in regulars books of account maintained nor in the document maintained at regular course of business CIT(A) held that income which is detected during the survey under section 133A is neither covered in the section 271AAB nor in Explanation5A filed to section 271(1)(c) of the Act. The penalty has not been imposed under section 271(1)(c) and therefore whether penalty was imposable on income detected during the survey but disclosed in return of income filed under section 139(1) of the Act (as time for filing return was available) itself is academic. CIT(A) also held that the penalty under section 271(1)(c) imposing only in the furnishing inaccurate particulars of concealment of particulars in the return of income filed. CIT(A) finally held that the total undisclosed income found as per the definition for the purpose of penalty under section 271AAB of the Act is only ₹ 3,33,27,250/- and not ₹ 34,99,87,344/- as considered by Assessing Officer. The penalty imposable under the said section on the facts of this case is 10% of ₹ 3,33,27,250/-. CIT(A) worked out the penalty of ₹ 3,33,275/- and deleted remaining penalty. The Ld. CIT(A) took absolutely correct view, which we affirm. No contrary fact or law is brought to our notice to take other view. We have affirm the order of Ld. CIT(A) on the primary submissions of the learned Senior Counsel for the assessee, therefore, adjudication on other submissions of the assessee have become academic. So far as objection of ld. CIT-DR for the revenue is concern that the Ld. CIT(A) when survey proceedings at one premise has been converted into search, it became a search case and the entire disclosure made by assessee-firm on the basis of excess stock not recorded in their books of account to be considered at undisclosed income for the purpose of section 271AAB. The objection of the ld CIT-DR is not convincing to us as survey action at Delhi office only has been converted in to search action. No case law to support such view, is brought to our notice. The ld. CIT(A) while partly confirming the penalty has considered the undisclosed income found at Delhi office for the purpose of penalty under section 271AAB. Appeal of the Revenue is dismissed.
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