TMI Blog2012 (2) TMI 235X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeals), Central-I, Kolkata for the block assessment period 01.04.1990 to 07.02.2001. 2. Brief facts as emanate from the submissions made before ld. CIT(Appeals) are that a search action was carried out on 07.02.2011, inter alia, at the business and residential premises of the assessee Shri Braj Binani, the Chairman of Binani Group- Binani Industries. In response to the search proceedings, nil return was filed. The block assessment for the period 1.4.1990 to 07.02.2001 was made under section 158BC read with section 143(3) of the Income Tax Act, 1961 on 28.02.2003 determining the block income at Rs.12,16,80,542/-. In this assessment, inter alia, jewellery worth Rs.12,77,635/- being undisclosed was added in the hands of the assessee. Ld. CIT(Appeals), Central Circle-I, Kolkata in a detailed order deleted almost all the additions including the addition made on account of jewellery except retaining a sum of Rs.25,00,000/- and whereby the appeal was partly allowed. The assessee as well as the Department carried forward the matter before the Tribunal and the Tribunal vide its order dated 31.07.2009, inter alia, confirmed the findings of ld. CIT(Appeals) in deleting the addition of Rs.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 for the first time before the Income Tax Authority, i.e. at the fag end of the block assessment proceedings, which were to be completed on 28.02.2003. The Assessing Officer in his assessment order observed as under :- As per second provision of the section 158BFA(2), that the provisions of the preceding provision shall not apply where the undisclosed income determined by the Assessing Officer is in excess of the income shown in the return and in such cases the penalty shall be imposed on that portion of undisclosed income determined which is in excess of the amount of undisclosed income shown in the return. The assesee filed block return on 26.08.02 and returned undisclosed income as per block return is Rs. Nil . The undisclosed jewellery added in the block assessment after giving effect of the order of the CIT(A.) ITAT is Rs.9,06,430/-. Therefore, as per provisions of this section, the assessee is liable to penalty on the amount of Rs.9,06,430/-. As per section 158BC, the Assessing Officer has to compute undisclosed income for the block period. Hence, every addition under this section constitutes concealment and attract penalty. The unexplained jewellery was unearthed by se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jewellery valued Rs.9,06,430/- was proved and confirmed by the ITAT? (2) Whether ld. CIT(A.), C-I, Kolkata had erred in holding that the imposition of penalty under section BFA(2) is not mandatory? 5. Ld. Departmental Representative referred to page 3 of the penalty order and pointed out that the bills relating to undisclosed jewellery were submitted on 25.02.2003 at the fag end of the block assessment proceedings that was to be completed on 28.02.2003. He referred to para 11.2 at pages 29-30 of the Tribunal s order and pointed out that the Tribunal reversed the finding of ld. CIT(Appeals) as description of the jewellery in the duplicate bills was different from that in the valuation report. He further submitted that the assessee failed to produce any evidence with regard to source of payment of such jewellery. 6. Ld. counsel for the assessee submitted that in course of search jewellery worth Rs.4,00,00,000/- was found, out of which only jewellery worth Rs.9,00,000/- was disbelieved. He submitted that in total there were 484 items, out of which only 16 items aggregating Rs.9,00,000/-were disbelieved. He submitted that the Tribunal did not disbelieve the factum of bills or ge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of CIT vs.- Dodsal Limited, wherein it has been observed at first para as under :- Under section 158BFA(2) of the Income Tax Act, 1961, the Assessing Officer or the Commissioner (Appeals) may direct the person to pay by way of penalty any sum which shall not be less than the amount of tax leviable but which shall not exceed three times the amount of tax so leviable in respect of the undisclosed income determined by the Assessing Officer under clause (c)of section 158BC of the Act. The terminology of the section makes it clear that there is a discretion in the Assessing Officer to direct payment of penalty. The proviso supports this interpretation. Only if the authority decides to impose penalty will it be not less than the tax leviable but not more than three times the tax so leviable. The expression shall not be less than the amount of tax leviable or not exceeding three times the tax , does not result in reading the first part of the section as mandatory. The proviso to the sub-section makes it clear that there is discretion on the Commissioner (Appeals) for the reasons which are set out therein . We, therefore, do not find any merit in this ground of appeal. Accordin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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