2002 (8) TMI 406

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....on the premises of the assessee on 10-11-1993 and one of the documents that was seized during the search operation was a receipt of Rs. 1 lakh paid by Shri Rajesh Jain in his individual capacity as the Director of the appellant company to Shri Gurmukh Singh as security deposit against property No. 138-B, Maya Puri Industrial Area Phase I, New Delhi. As this amount was not reflected in the books of account of the assessee, the assessee was required to explain why this amount should not be treated as unexplained expenditure. 3. The explanation called for by the Assessing Officer from the assessee as to why this amount be not treated as unexplained expenditure did not find favour with the Assessing Officer and the Assessing Officer was please....

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....s satisfaction to the effect that he is satisfied that the assessee has concealed the income. According to the ld. AR, unless and until such a satisfaction is recorded in the asstt. order itself, penalty under section 271(1)(c) of the Income-tax Act, cannot be imposed. To strengthen his argument, the ld. AR pressed into the services the judgment of the Delhi High Court (2001) reported in 187 CTR 221 in case CIT v. Ram Commercial Enterprises Ltd. and submitted that merely because the penalty proceedings have been initiated, it cannot be assumed that such a satisfaction is achieved in the absence of the same being spelt out by the order of the authority. After having said so, the ld. AR submitted that the asstt. order does not record satisfac....