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2023 (5) TMI 953 - AT - Income TaxPenalty u/s 271 AAA - assessee has not furnished any explanation in respect of surrendered income u/s 132(4) either at the time of assessment proceedings or during the course of penalty proceedings - HELD THAT:- In case of Bhagirath Aggarwal [2013 (2) TMI 48 - DELHI HIGH COURT] has held that “if an assessee voluntarily makes a surrender, the officials of the income tax department are bound to record that statement u/s 132(4) and such a statement, voluntarily made, is relevant and admissible and is liable to be used as evidence”. Thus where no statement u/s 132(2) of the Act is recorded or specific query is made during assessment, for the purpose of Section 271AAA of the Act, then no inference can be drawn that assessee failed to specify the manner in which such income has been derived or substantiates the manner in which the undisclosed income was derived, so as to levy the penalty. At the same time, the order in Rajendra Aggarwal [2019 (1) TMI 1208 - ITAT DELHI] is also relevant where it is held that the initiation of penalty u/s 271AAA cannot be on the basis of surrendered amount which cannot be termed as undisclosed income for the purpose of Section 271AAA of the Act. Appeal of assessee allowed.
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