TMI Blog2014 (11) TMI 1031X X X X Extracts X X X X X X X X Extracts X X X X ..... the Hon'ble Supreme Court in the case of Gebilal Kanhaialal HUF (2012 (9) TMI 297 - SUPREME COURT ), the CIT(A) made no mistake in holding that assessee has fulfilled the condition of clause (iii) of sub-section (2) of section 271AAA of the Act and accordingly the penalty levied by the Assessing Officer has been justifiably cancelled. - Decided in favour of assessee. - ITA No. 1427/PN/2013 - - - Dated:- 28-11-2014 - G. S. Pannu (Accountant Member) And Sushma Chowla (Judicial Member) For the Petitioner : P. S. Naik For the Respondent : Nikhil Pathak ORDER G. S. Pannu (Accountant Member) The captioned appeal by the Revenue is directed against an order of the Commissioner of Income Tax (Appeals), Aurangabad dated 02 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee did not fulfill one of the conditions prescribed in sub-section (2) of section 271AAA of the Act and therefore a penalty equivalent to 10% of the surrendered income was leviable, thereby resulting in levy of penalty amounting to ₹ 45,00,000/-. The CIT(A) has not agreed with the stand of the Assessing Officer because according to him, assessee has complied with all the conditions laid down in sub-section (2) of section 271AAA of the Act and therefore no penalty was leviable u/s 271AAA of the Act. 4. Section 271AAA of the Act prescribes that in a case where search has been initiated u/s 132 on or after the 1st day of June, 2007 but before the 1st day of July, 2012, assessee shall pay by way of penalty, a sum equivalent t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mplies with three conditions prescribed therein. Firstly, if the assessee makes a statement u/s 132(4) of the Act and admits the undisclosed income and specifies the manner in which such income has been derived; secondly, if the assessee substantiates the manner in which the undisclosed income was derived; and, thirdly, assessee pays the required tax, together with interest, if any, in respect of the undisclosed income. On fulfillment of all the three conditions, no penalty is imposable u/s 271AAA of the Act. 6. In the present case, admittedly the first and the second condition has been complied with by the assessee inasmuch as the Assessing Officer has also concluded that it is only the third condition which has not been complied with b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... together with interest, fully on the income surrendered in a statement made u/s 132(4) of the Act. Therefore, the Assessing Officer concluded that assessee has not complied with the third condition prescribed in clause (iii) of sub-section (2) of section 271AAA of the Act. In the course of hearing before us, the Ld. Departmental Representative has reiterated the aforesaid stand of the Assessing Officer. The Ld. Departmental Representative has pointed out that in terms of the amendment to section 132B of the Act by the Finance Act, 2013 w.e.f. 01.06.2013 the existing liability will not include advance tax liability and therefore the seized cash could only be considered as 'tax' after completion of assessment. Therefore, according to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he present case. In the case before the Hon'ble Supreme Court, issue related to a penalty imposed u/s 271(1)(c) of the Act on an amount of income surrendered by the assessee in a statement recorded u/s 132(4) of the Act. Clause (2) of Explanation 5 to section 271(1)(c) of the Act prescribed immunity from levy of penalty u/s 271(1)(c) of the Act with respect to an income surrendered in a statement u/s 132(4) of the Act. One of the conditions prescribed therein is to the effect that assessee pays the tax, together with interest, if any, in respect of such income . The Revenue had contended before the Hon'ble Supreme Court that assessee therein had failed to make payment of tax in time. In this context, the Hon'ble Supreme Court n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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