TMI Blog2017 (1) TMI 112X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee stands allowed and penalty stands deleted. - ITA No.1346/Del./2014 - - - Dated:- 26-10-2016 - SHRI L.P. SAHU, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER For The Assessee : Shri R.S. Singhvi, Advocate For The Revenue : Shri Rajesh Kumar, Senior DR ORDER PER KULDIP SINGH, JUDICIAL MEMBER : Appellant, M/s. Navdeep Jewellers Pvt. Ltd. (hereinafter referred to as the assessee ), by filing the present appeal sought to set aside the impugned order dated 18.12.2013 passed by the Commissioner of Income-tax (Appeals (Central), Gurgaon qua the assessment year 20010-11 confirming the penalty levied u/s 271AAA on the grounds inter alia that :- 1. A search seizure action u/s 132 of the Income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sting of unaccounted job-work, unaccounted purchase of old jewellery at cheap rate and unaccounted income received from other jewelers. However, no documentary evidence have been produced by the assessee in support of his claim. In view of the above, it is seen that assessee has not been able to substantiate the manner in which undisclosed income has been derived and therefore I am satisfied that the assessee is liable for facing penalty proceedings u/s 271 AAA of the I T. Act, with regards to surrender of undisclosed income made of ₹ 17,04,317/- and accordingly penalty proceeding are being initiated separately by the issue of notice U/S 274 of the I T. Act. 8. Aggrieved against the Penalty Order u/s 271 AAA, the assessee filed a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s held in Pioneer(supra), there has been a paradigm shift in the treatment of undisclosed income which gets unearth during the search operations. The burden cast upon the assessee is much higher as unlike in see 271 (1)(c) explanation 5 if the assessee fails to divulge such finer details of the earning of income, then the requirements of immunity can be held to be not met. The questions posed by the AO were categorical. To reiterate, the provisions of the sub Sec. 2 (i) (ii) and (iii) of section 271AAA are very clear. These three conditions need to be satisfied together. There is no dispute regarding sub see (i) and (iii). In this case as the assessee cannot be said to have discharged the onus of substantiating the manner in which the incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owever, AO has not accepted the submissions made by the assessee and imposed the penalty to the tune of ₹ 17,04,317/- u/s 271AAA (1) of the Act. 3. Assessee challenged the penalty order before the ld. CIT (A) who has affirmed the penalty order by dismissing the appeal. Feeling aggrieved, the assessee has come up before the Tribunal by way of filing the present appeal. 4. We have heard the ld. Authorized Representatives of the parties to the appeal, gone through the documents relied upon and orders passed by the revenue authorities below in the light of the facts and circumstances of the case. 5. It is not in dispute that during the search and seizure operation, the assessee has made following disclosure :- Income relating to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rn of income filed by the assessee u/s 153B(1)(b) of the Act. 8. Undisputedly, consequent to the search and seizure operation conducted on the business premises of the assessee company on 30.07.2009, surrender to the tune of ₹ 1,70,43,170/- has been made and thereafter assessment was completed u/s 153B(1)(b) of the Act at ₹ 1,74,98,810/- and the assessee has deposited the due tax along with interest. 9. To proceed further, we would like to reproduce the provisions contained u/s 271AAA of the Act for ready perusal:- 271AAA. (1) The Assessing Officer may, notwithstanding anything contained in any other provisions of this Act, direct that, in a case where search has been initiated under section 132 on or after the 1st d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earch operation are related to unaccounted income which was invested in the showroom and stock of jewellery. However, AO has proceeded to invoke the provisions contained u/s 271AAA on the ground that the assessee has not disclosed how exactly the undisclosed income was returned but undisputedly the AO has not examined the assessee on oath as required u/s 132(4) of the Act to substantiate the manner in which the undisclosed income was derived, rather proceeded on the basis of disclosure letter given by the assessee. 12. When the assessee has given details of unaccounted money available with him during the search operation substantiated with loose paper/documents seized during search and seizure operation and the AO has not questioned the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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