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The Asstt. Commissioner of Income-tax, Central Circle II (1) , Chennai Versus Smt. Gomathi Radhakrishnan and Vica-Versa

Penalty u/s 271AAA - Held that:- By way of letters dated 24.12.2010 ad 28.12.2010, the assessee offered additional sum of ₹ 1,05,88,900/- which was accepted by the Assessing Officer without any further addition. The assessee, in fact, telescoped the lease rental received by the assessee against the voluntary contribution received by Sri Vetrivel Educational & Charitable Trust. When the assessee claims that voluntary contribution was received by Sri Vetrivel Educational & Charitable Trust, .....

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t of the income which falls in subsection( 1) of sec. 271AAA of the Act. In the case before us, admittedly, the search was conducted on 29.9.2008, therefore, penalty, if any, has to be levied only u/s 271AAA of the Act and definitely not u/s 271(1)(c) of the Act. Therefore, this Tribunal is of the considered opinion that the CIT(A) has rightly deleted the penalty levied by the Assessing Officer. - Levy of penalty u/s 271(1)(c) - Held that:- This Tribunal is of the considered opinion that mer .....

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ted in the case of Shri A.N. Radhakrishnan on 29.9.2008. Therefore, penalty, if any, has to be levied u/s 271AAA of the Act and definitely not u/s 271(1)(c) of the Act. Sub-section(3) of sec. 271AAA of the Act in categorical terms declares that no penalty can be levied u/s 271(1)(c) of the Act when the income falls u/s 271AAA(1) of the Act. In the case before us, it is not in dispute that the income falls u/s 271AAA(1) of the Act. Therefore, no penalty can be levied u/s 271(1)(c) of the Act. In .....

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R.S.GANESAN, JUDICIAL MEMBER All the appeals of the Revenue and the assessee are directed against the respective orders of the Commissioner of Income tax (Appeals), Chennai, with regard to levy of penalty u/s 271(1)(c) of the Income-tax Act, 1961. Since common issue arises for consideration in all the appeals, we heard them together and disposing of the same by this common order. 2. For the assessment year 2003-04 in I.T.A.No.1617/ Mds/2013, the Assessing Officer levied penalty u/s 271(1)(c) of .....

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7; 4,03,911/-. The assessee has also offered an additional sum of ₹ 9,59,433/- during the course of assessment proceedings. According to the ld. DR, since the assessee has not declared the above sum of ₹ 9,59,433/- in the return of income, the assessee has concealed the income, therefore, the Assessing Officer has rightly levied penalty u/s 271(1)(c) of the Act. 4. On the contrary, Shri S.Sridhar, ld. Counsel for the assessee submitted that, in fact, ₹ 5,59,433/- was the lease .....

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s husband. Therefore, there cannot be any levy of penalty u/s 271(1)(c) of the Act. Hence, the CIT(A) has rightly deleted the penalty levied by the Assessing Officer. Referring to the order of the CIT(A), the ld. Counsel submitted that the income offered by the assessee was accepted by the Assessing Officer without any further addition. Merely because certain inference has been made in the assessment proceedings, there cannot be any reason to levy penalty automatically. Referring to sec. 271(1) .....

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the basis of the incriminating material found during the course of search operation, the Assessing Officer issued notice u/s 153C of the Act. Even though the assessee declared taxable income of ₹ 4,03,911/-, the assessee has also offered a sum of ₹ 9,59,433/- in the course of assessment proceedings by way of letters dated 24.12.2010 and 28.12.2010. The Assessing Officer has in fact accepted the income offered by the assessee and the assessment was completed. The assessee now claims .....

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essment proceedings cannot automatically result in levy of penalty. Even though there was an addition in the assessment proceedings, while levying penalty, the Assessing Officer has to re-appreciate the material available on record. When the assessee claims that what was received by her daughter Premalatha is lease advance, this Tribunal is of the considered opinion that the lease advance cannot be construed as income of the assessee. Moreover, if at all any addition has to be made, it has to be .....

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se where search was initiated on or after 1.6.2007 but before 1.7.2012. Sub-section (3) of sec. 271AAA of the Act in categorical terms declares that no penalty can be levied u/s 271(1)(c) of the Act in respect of the undisclosed income referred to in sub-section(1) of sec. 271AAA of the Act. In the case before us, the penalty levied by the Assessing Officer squarely falls u/s 271AAA of the Act. Therefore, there cannot be any levy of penalty u/s 271(1)(c) of the Act in view of section 271AAA(3) o .....

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5/-. Moreover, by way of letters dated 24.12.2010 and 28.12.2010, the assessee has also offered additional sum of ₹ 1,05,88,900/-. Since ₹ 1,05,88,900/- was not offered in the original return, according to the ld. DR, there was a concealment of income,. Therefore, the CIT(A) is not justified in deleting the penalty levied by the Assessing Officer u/s 271(1)(c) of the Act. 8. On the contrary, Shri S. Sridhar, ld. Counsel for the assessee submitted that even though the assessee origina .....

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8377; 1,05,88,900/-. According to the ld. Counsel, the Assessing Officer accepted the income offered by the assessee without any further addition, therefore, the CIT(A) has rightly deleted the penalty levied by the Assessing Officer. 9. We have considered the rival submissions on either side and also perused the material available on record. As rightly submitted by the ld. DR, the assessee has declared ₹ 8,49,855/- in the original return. By way of letters dated 24.12.2010 ad 28.12.2010, t .....

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or levy of penalty u/s 271(1)(c) of the Act. The Assessing Officer has to reappreciate the material available on record and find out whether the income actually relates to the assessee. Moreover, by sec. 271AAA of the Act, the Parliament enacted a separate provision for levy of penalty. Sub-section (3) of sec. 271AAA of the Act in categorical terms declares that no penalty can be levied u/s 271(1)(c) of the Act in respect of the income which falls in subsection( 1) of sec. 271AAA of the Act. In .....

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Act. 11. Shri S. Sridhar, ld. Counsel for the assessee submitted that there was a search in the case of Shri A.N. Radhakrishnan, husband of the assessee, on 29.9.2008. Consequently, notice u/s 153C of the Act was issued. The assessee has declared taxable income of ₹ 8,01,979/-. In fact, the assessment proceedings was completed u/s 153C of the Act on 31.12.2010. During the course of assessment proceedings, the assessee has also offered a sum of ₹ 40,50,000/- being the advance lease re .....

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ld. Counsel, penalty cannot be levied on the basis of the statement recorded u/s 131(1) of the Act. 12. On the contrary, Shri Sahadevan, ld. DR submitted that the assessee has paid an advance of ₹ 40,75,000/- for purchase of a flat at Saligramam, Chennai. However, the source of such payment was not disclosed to the Revenue. On a query from the Bench, the ld. DR clarified that even though the Assessing Officer found that the assessee has received a sum of ₹ 40,50,000/- towards advance .....

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l available on record. In the penalty order, the Assessing Officer claims that the assessee has received a sum of ₹ 40,50,000/- from Smt. U.Anitha for a flat at Saligramam, Chennai. However, the CIT(A) fund that the assessee has paid advance of ₹ 40,75,000/- for purchase of flat at Saligramam. The fact remains that the assessee has not disclosed ₹ 40,75,000/- in the return of income. However, the same was voluntarily offered during the course of assessment proceedings. The Asse .....

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y u/s 271(1)(c) of the Act. The Assessing Officer has to reappreciate the material available on record and find out whether there was any concealment of income. In the case before us, both the lower authorities have not reappreciated the material available on record. Merely because the assessee offered the amount as income, they have levied/confirmed penalty u/s 271(1)(c) of the Act. The fact remains that the search was conducted in the case of Shri A.N. Radhakrishnan on 29.9.2008. Therefore, pe .....

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es below. Accordingly, the orders of the lower authorities are set asie and the penalty levied by the Assessing Officer u/s 271(1)(c) of the Act is deleted. 14. Now coming to assessment year 2008-09, both the assessee and Revenue filed appeals. 15. Shri Sahadevan, ld. DR submitted that the Assessing Officer levied penalty u/s 271(1)(c) of the Act in respect of the income offered by the assessee. According to the ld. DR, the assessee has offered a sum of ₹ 86 lakhs by way of letter dated 24 .....

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y the CIT(A). However, in respect of ₹ 86 lakhs offered by the assessee as undisclosed income, the CIT(A) deleted the penalty levied by the Assessing Officer. According to the ld. DR, the CIT(A) ought not to have deleted the penalty with respect to the investment in KK Nagar Property and Thalakanchery property. These are all investment made by the assessee which was not disclosed in the return of income, therefore, there was a definite concealment of income to that extent. Hence, the CIT(A .....

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ver, in order to avoid litigation, the assessee has offered the assessee as income and paid taxes. Morever, ₹ 6 lakhs was in fact received by her daughter as gift. The assessee has also offered a sum of ₹ 80 lakhs as undisclosed income in Thalakachery property. The assessee in fact filed a revised return on 31.10.2010. The disclosure made by the assessee was accepted by the Assessing Officer and the same was brought to taxation. According to the ld. Counsel, the entire addition was m .....

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of the income offered by the assessee to the extent of ₹ 86 lakhs. Therefore, the assessee filed the appeal in respect of penalty confirmed by the CIT(A) to the extent of ₹ 14 lakhs and ₹ 80 lakhs being the investments made in KK Nagar property and Thalakanchery property. 17. We have considered the rival submissions on either side and also perused the material available on record. The assessment was completed u/s 153C of the Act consequent to the search conduced in the case of .....

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