2016 (12) TMI 752
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....isions of section 271AAA(2)(iii) which do not stipulate any time frame for payment of taxes and interest thereon on undisclosed income. 3. The appellant craves leave to add to or amend any ground of appeal before the disposal of appeal." 3. The only issue involved in the present appeal relates to the levy of penalty under section 271AAA of the Income Tax Act, 1961 (in short 'the Act'). 4. Brief facts relating to the case are that a search and seizure operation was carried out at the residential/business premises of Manohar Singh group of cases on 8.9.2011. The assessee M/s. Manohar Infrastructure and Construction Pvt. Ltd. was one of the concerns covered under section 132 of the Act. During search operation, various documents were found and discrepancies were detected, which when confronted to Shri Taraninder Singh, Director of Manohar Singh group of cases, he voluntarily disclosed Rs. 13 crores under section 132(4) of the Act. On being asked to file break-up of the disclosure of Rs. 13 crores, assessee-wise break-up was given which showed an amount of Rs. 6.5 crores surrendered in the name of the assessee i.e. M/s. Manohar Infrastructure and Construction Pvt. Ltd. Du....
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....ity from penalty including payment of all taxes due on the income surrendered. The Ld. CIT (Appeals) after going through the detailed submissions of the assessee reproduced at para 4 of his order, held that the assessee had substantiated the manner in which the undisclosed income was derived but at the same time held that since the taxes on the same had not been paid before the due date of filing of the return of income, penalty under section 271AAA of the Act was leviable. The Ld. CIT (Appeals) placed reliance on the order of the Hon'ble Punjab and Haryana High Court in the case of Ashok Kumar Gupta vs. CIT (2006) 287 ITR 376 (P and H) in support of the proposition that immunity from penalty can be availed by the assessee invoking the provisions of Explanation-5 of section 271(1)(c) of the Act if tax on the surrendered income alongwith interest paid immediately and in any case before due date of return. In view of the same, the Ld. CIT (Appeals) upheld the penalty levied under section 271AAA of the Act. 7. Aggrieved by the same, the assessee filed the present appeal before us. The learned counsel for the assessee stated that the only reason for upholding the penalty was that ....
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....taxes since the other two conditions prescribed for claiming immunity have been accepted by the CIT (Appeals) himself as being fulfilled by the assessee. The Hon'ble I.T.A.T., Chandigarh Bench in the case of Shri Satish Goyal vs. DCIT in ITA No. 635/Chd/2016 has in identical circumstances deleted the levy of penalty under section 271AA of the Act levied for non-payment of taxes before the due date of filing of return of income by holding as follows:- 8. We have heard the rival contentions and perused the orders of the authorities below as also the documents placed before us. The sole issue arising in the present appeal is whether for claiming immunity from the levy of penalty under section 271AAA, the assessee is required to pay the due taxes on the undisclosed income before the due date of filing of return of income. The Ld. CIT(A), we find relied upon the order of Punjab and Haryana High Court in the case of Ashok Kumar Gupta vs. CIT (2006) 287 ITR 376 for upholding the levy of penalty. The Hon'ble High Court in the impugned case held as under:- "It was not in dispute that certain undisclosed assets were found from the premises of the assessee at the time of search a....
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....ion 5 is a deeming provision. It provides that where, in the course of search under Section 132, the assessee is found to be the owner of unaccounted assets and the assessee claims that such assets have been acquired by him by utilizing, wholly or partly, his income for any previous year which has ended before the date of search or which is to end on or after the date of search, then, in such a situation, notwithstanding that such income is declared by him in any return of income furnished on or after the date of search, he shall be deemed to have concealed the particulars of his income for the purposes of imposition of penalty under Section 271(1)(c). The only exceptions to such a deeming provision or to such a presumption of concealment are given in sub-clauses (1) and (2) of Explanation 5. In this case, we are concerned with interpretation of clause (2) of Explanation 5, which has been quoted above. Three conditions have got to be satisfied by the assessee for claiming immunity from payment of -penalty under clause (2) of Explanation 5 to Section 271(1)(c). The first condition was that the assessee must make a statement under Section 132(4) in the course of search stating that t....