TMI Blog2017 (2) TMI 110X X X X Extracts X X X X X X X X Extracts X X X X ..... anjukta Chowdhury, AR For The Respondent : Mr. Maurya Pratap, DR ORDER PER N.K. PRADHAN, A.M. This is an appeal filed by the assessee. The relevant assessment year is 2010-11. It is directed against the order of Commissioner of Income Tax (Appeals)-39, Mumbai and arises out of the order u/s. 271AAA of the Income Tax Act, 1961 ( the Act ). 2. The sole ground raised by the assessee in this appeal is that ld. CIT(A) erred in confirming the levy of penalty without appreciating that the appellant had admitted to the undisclosed income during the course of search and specified the manner in which the same was derived and consequently paid the taxes thereon, therefore it is not a fit case u/s Appellant by: Mrs. Sanjukta Cho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as undisclosed income. The AO completed the assessment u/s 143(3) on 26/12/2011 assessing the income at ₹ 2,07,40,700/- Then the AO imposed a penalty of ₹ 16,30,100/- u/s 271AAA of the Act. The assessee preferred appeal against the order of the AO before the ld. CIT(A). The ld. CIT(A) has dismissed the appeal filed by the assessee. 4. Before us, the ld. Counsel of the assessee submits that merely because quantum is confirmed, it does not become an automatic case for the levy of penalty u/s 271AAA. It is stated that the case of the assessee falls in sub 3 sec.(2) of section 271AAA. She further clarifies that during the recording of statement, the Director Shri. Prakash K. Jain has explained about the manner of accumulation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year can be avoided if the following conditions are satisfied- i. If the assessee in a statement u/s 132(4) in the course of the search, admits the undisclosed income. Further, he specifies the manner in which such income has been derived. ii. He substantiates the manner in which the undisclosed income was derived. iii. He pays the tax, together with interest, if any, in respect of the undisclosed income. If the above three conditions are satisfied penalty u/s 271AAA (i.e. 10 per cent of undisclosed income of the specified previous year ) can be avoided. 6.1 As pointed out by the Hon ble Supreme Court in Anantharam Veerasinghaiah Co vs. CIT (1980) 123 ITR 457,462 (SC), the findings recorded in the assessment order const ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0/- as additional income on account of cash salary paid to Mr. Motilal Lodha. I humbly request that no penalty/prosecution proceedings are launched against our company, and we shall fully co-operate with the income tax proceedings. 6.3 A similar issue arose before ITAT A Bench Mumbai in the case of M/s. Kanakia Spaces Pvt. Ltd. (supra). The ground raised by the Revenue before the Tribunal was as under: 1. On the facts and in the circumstances of the case and in law, the ld. CIT(A) erred in deleting penalty levied u/s. 271AAA of the I.T. Act,1961 of ₹ 55,00,000/- without appreciating the fact that assessee failed to substantiate the manner in which undisclosed income was derived so as to qualify for non-levy of penalty within ..... X X X X Extracts X X X X X X X X Extracts X X X X
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