TMI Blog2018 (9) TMI 1560X X X X Extracts X X X X X X X X Extracts X X X X ..... erived. - Decided against revenue - Income Tax Appeal No. 973/2018 - - - Dated:- 13-9-2018 - MR. SANJIV KHANNA AND MR. CHANDER SHEKHAR JJ. Appellant Through: Mr. Ruchir Bhatia, Advocate. Respondent Through: Mr. Rohit Jain Mr. Aniket D. Agrawal, Advocates. SANJIV KHANNA, J. (ORAL): This appeal by the Revenue under Section 260A of the Income Tax Act, 1961 (Act, for short) impugns the order dated 17th April, 2018 passed by the Income Tax Appellate Tribunal (Tribunal, for short) in the case of Bhavi Chand Jindal (respondent-assessee, for short). The impugned order affirms the order passed by the Commissioner of Income Tax (Appeals) deleting penalty of ₹ 3 crores imposed by the Assessing Officer under Section 271AAA of the Act. The appeal relates to Assessment Year 2012-13. 2. Having heard learned counsel for the appellant-Revenue, we are not inclined to interfere with the impugned order for several reasons. 3. The assessment order records that the respondent-assessee is an individual, who was subjected to search and seizure operations at his premises at Kolkata on 14th November, 2011. Later on, this case was centralised with Central Circle-14, New D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... basis of material on record. Considering the facts and circumstances of the case, I am of the opinion that it is fit case for imposition of penalty under Section 271AAA. The quantum of penalty is computed @ 10% of the amount of disclosure at ₹ 30,00,00,000. Hence penalty is levied at ₹ 3 Crore. Penalty imposed u/s 271AAA: ₹ 3,00,00,000/- 5. It is clear that there is hardly any discussion in the penalty order. It is a brief and cryptic order. 6. We are concerned for we notice that surrender of ₹ 30 crores was made by Mr. Punit Jatia, one of the directors of M/s Jindal (India) Limited in his statement recorded on oath under Section 132(4) of the Act on 15th November, 2011 on the basis of seized documents. The surrender was made by the respondent-assessee by way of letter dated 25th March, 2014. This has been treated as valid surrender and statement under Section 132(4) of the Act. Nature and manner of surrender and whether it would satisfy requirement of sub-section (2) to Section 271AAA is not examined either in the assessment order or in the penalty order under Section 271AAA. It is also apparent that this contention was not raised by the R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issued notices under section 271AAA of the Income tax Act, 1961 dated 31/03/2014 and 03/09/2014, to show cause as to why an order imposing a penalty should not be made under section 271AAA of the Income tax Act, 1961 as the appellant has not substantiated the manner in which undisclosed income admitted during search was derived. (Pages 8 to 8A of the Paper book) In response, the appellant vide replies dated 28/04/2014 and 08/09/2014 submitted that no specific query was raised by the authorized officer during the course of recording statement under section 132(4) of the Income tax Act, 1961 in relation to the manner in which the undisclosed income was derived by the appellant. The appellant further submitted that since during the course of search undisclosed income is admitted and the same was offered for tax, together with interest has been paid, return showing said income has been filed and the same is also been accepted as it is in the assessment, merely because the appellant had not specified the manner in which the said undisclosed income was derived, could not be the basis for denying the benefit of immunity from penalty under sub section (2) of section 271AAA of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rded on oath under section 132(4) of the Income tax Act, 1961 on 15/11/2011 on the basis of certain seized documents. It is also pertinent to note that the appellant filed his return of income for the said assessment year on 31/08/2012 declaring income of ₹ 30,28,31,563/-, which inter alia includes income of ₹ 30,00,00,000/-, which was surrendered by Mr. Punit Jatia one of the directors of M/s Jindal (India) Limited in his statement recorded on oath under section 132(4) of the Income tax Act, 1961 on 15/11/2011, which was relatable to the appellant. It is also pertinent to note that the said disclosure was made to buy peace of mind, avoid litigation with the department and penal provisions under the Income tax Act, 1961. (Pages 5 to 6 and Pages 29 to 31 of the Paper book) 1.11 It is pertinent to note that the learned assessing officer vide notice dated 05/03/2014 asked the appellant to specify the nature of income, bifurcation with the supporting evidences. (Page 7 of the Paper book) 1.12 It is also pertinent to note that in response the appellant. vide reply dated 19/03/2014 submitted that the income of ₹ 30,00,00,000/- declared under the under the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alty of ₹ 3,00,00,000/- imposed under section 271AAA of the Income tax Act, 1961 is liable to be deleted. 1.16 It is also pertinent to note that the authorized officer during the course of recording statement under section 132(4) of the Income tax Act, 1961 has not asked the appellant / directors of M/s Jindal (India) Limited to specify or to substantiate the manner in which the undisclosed income of ₹ 30,00,00,000/- was derived and thus the. appellant / directors of M/s Jindal (India) Limited has not specified the manner in which the said undisclosed income of ₹ 30,00,00,000/- was earned at the time of recording statement under section 132(4) of the Income tax Act, 1961. However, duing the course of assessment proceedings the appellant has specified and substantiated the manner in which the said undisclosed income of ₹ 30,00,00,000/- was derived as required by the learned assessing officer. (Pages 9 to 18 and Pages 29 to 31 of the Paper book) 8. The aforesaid communications written by the respondent-assessee to the Assessing Officer during the course of the assessment proceedings have not been placed on record in the present appeal. The penal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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