TMI Blog2017 (11) TMI 1213X X X X Extracts X X X X X X X X Extracts X X X X ..... anner in which such income was derived and to substantiate the manner in which such income was derived. Furthermore AO has nowhere recorded any finding in the assessment order that it is undisclosed income of the assessee sufficient to attract the provisions contained u/s 271AAA. Coordinate Bench while dealing with the identical issue in case cited as Neerat Singal vs. ACIT – (2013 (6) TMI 762 - ITAT DELHI) also held that the AO was not justified in imposing penalty u/s 271AAA when authorized officer has not raised any query during course of recording of statement u/s 132 (4) about the manner in which the undisclosed income has been derived and about its substantiation. There is no illegality or perversity in the findings returned by ld. CIT (A) in deleting the penalty imposed u/s 271AAA - Decided in favour of assessee. - ITA No.2730/Del./2014, ITA No.2731/Del./2014, ITA No.2732/Del./2014 And ITA No.2733/Del./2014 - - - Dated:- 16-11-2017 - SHRI G.D. AGRAWAL, PRESIDENT AND SHRI KULDIP SINGH, JUDICIAL MEMBER For The ASSESSEE : Shri Adesh Kumar Jain, Rajat Jain and Akshant Jain, CAs For The REVENUE : Ms. Shefali Swroop, CIT DR ORDER PER BENCH : Sin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,857/- and ₹ 2,49,93,708/- for assessment years 2008-09, 2009-10 2010-11 respectively by making addition @ 0.25% of the total turnover declared by the assessee company. 6. AO proceeded to levy the penalty on the ground that when the account books were test checked and discrepancies were pointed out to the assessee company and only then, the assessee company had offered additional surrender during the assessment proceedings which is a clear case of concealment on the part of the assessee company and thereby imposed a penalty of ₹ 30,14,473/-, ₹ 46,07,976/- and ₹ 84,95,360/- for assessment years 2008-09, 2009-10 2010-11 respectively. ITA NO.2733/DEL/2014 (PENALTY U/S 271AAA) 7. AO initiated the penalty proceedings u/s 271AAA for AY 2010-11 on the basis of assessment order dated 30.12.2011 passed u/s 143 (3) and imposed the penalty of ₹ 2,60,63,900/- on the ground that the assessee company has neither specified the manner in which the disclosure of amount of ₹ 2,60,63,900/- was derived nor he has substantiated the manner in which such income was derived. 8. Assessee carried the matter by way of filing appeals before the ld. CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the provision, the penalty provision cannot be invoked. By no stretch of imagination can making an incorrect claim tantamount to furnishing inaccurate particulars. There can be no dispute that everything would depend upon the return filed by the assessee, because that is the only document where the assessee can furnish the particulars of his income. When such particulars are found to be inaccurate, the liability would arise. To attract penalty, the details supplied in the return must not be accurate, not exact or correct, not according to the truth or erroneous. Where there is no finding that any details supplied by the assessee in its return are found to be incorrect or erroneous or false there is no question of inviting the penalty under section 271(1)(c). A mere making of a claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. Such a claim made in the return cannot amount to furnishing inaccurate particulars. 12. Hon ble Delhi High Court in case of CIT vs. Aero Traders (P.) Ltd. (2010) 322 ITR 316 (Delhi) decided the identical issue in favour of the assessee company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 2,60,63,900/-. 16. Undisputedly, the assessee company has surrendered an amount of ₹ 26,06,38,986/- during search and seizure operation, but shown his inability to produce purchase bills of the various parties who have allegedly supplied mitti and grit (raw material) recorded in the ledger. It is also not in dispute that the assessee company by filing return u/s 139 deposited the tax along with interest. 17. Under section 271AAA (2), no penalty shall be levied u/s 271AAA qua the undisputed income in case the assessee company furnished declaration of the undisclosed income in the following manner :- ( a) There is deeming fiction of undisclosed income relating to specified previous year as defined under Section 271AAA. ( b) With respect to undisclosed income relating to specified previous year , penalty is leviable at the rate of ten percent of undisclosed income . ( c) Sub-section (2) of section 271AAA provides that no penalty under section 271AAA shall be levied with respect to the undisclosed income of the specified previous year , in case assessee makes declaration of the undisclosed income in the following manner :- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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