TMI Blog2019 (1) TMI 641X X X X Extracts X X X X X X X X Extracts X X X X ..... penalty, the stand taken by the assessee deserves to be looked into and deserves to be decided afresh. CIT(A) has confirmed penalty for deemed concealment, whereas, this was not used by the AO as reason for visiting the assessee with penalty. We extracted a part of the penalty order as well as finding of the CIT(A). If both the orders of the Revenue authorities are being examined in the light of the discussion made by the Tribunal in the case Shri Kantibhai Naranbhai Prajpati [2018 (2) TMI 1823 - ITAT AHMEDABAD] then penalty is not sustainable. - Decided in favour of assessee. - ITA No.1041/Ahd/2015 - - - Dated:- 9-1-2019 - SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER For The Assessee : Shri T.P. Hema ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontended by the assessee that it has made a note along with return of income wherein it submitted that ₹ 3,99,850/- was earned in earlier year, and it was duly recognized as normal profit in the return filed for earlier year. Therefore, balance of ₹ 8.50 lakhs was offered in this assessment year. The ld.AO was not satisfied with the explanation of the assessee. He observed that the assessee has furnished inaccurate particualrs to the extent of ₹ 3.00 lakhs, and accordingly levied penalty of ₹ 93,630/- which is equivalent to the tax sought to be evaded of ₹ 3 lakhs. The finding recorded by the AO in para-5 is worth to note. It reads as under: 5. In view of the above discussion, it is clear that the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 000/- was added as disclosed under survey. The appellant neither before the AO nor before me has submitted the details of expenditure to arrive at the figure of ₹ 8,50,000/-. In view of the above and Explanation 1 to Section 271(1)(c), penalty of ₹ 3,00,000/- levied by the Assessing Officer u/s. 271(1)(c) is confirmed. 5. With the assistance of the ld.representatives, we have gone through the record carefully. The ld.counsel for the assessee has raised multi-fold contentions before us. In the first fold of contentions, he submitted that the addition has been made on the basis of alleged voluntary disclosure. This disclosure is based on a statement recorded during the course of search, and such statement was given without a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith penalty unless such penalty proceedings was initiated by the ld.CIT(A). For buttressing his contentions, he relied upon the order of the ITAT passed in the case of Shri Kantibhai Naranbhai Prajapati in ITA No.2880/Ahd/2014 which has been taken note by the Tribunal in the case of Shri Jayendra N. Shah Vs. ACIT, in ITA No.1381/Ahd/2016. The Tribunal has reproduced finding of the ITAT in the case of Kantibhai Naranbhai Prajpati (supra). Such finding reads as under: 6. We have heard the rival contentions and perused the materials available on record. At the outset, we find that in the identical facts and circumstances the Hon'ble ITAT in the case of Kantibhai Naranbhai Prajapati (supra) has deleted the penalty imposed by the lowe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w, we usefully refer to the decision of the Hon'ble Gujarat High Court in the case of New Sorathia Engineering Company vs. CIT(2006) 282 ITR 642 (Guj.) and CIT vs. Manu Engineering Works (1980) 122 ITR 306 (Guj.). Similar view has been taken by the Coordinate Bench of the Tribunal in Gian Chand Batia vs. DCIT 61 ITD 24(AIL). Therefore, where concurrent I.T.authorities are not sure about nature of default, the penal action under s.271(l)(c) of the Act is not sustainable in law. The facts of the case in hand are identical to the facts of the case as discussed above. Therefore, the ratio laid down by this Tribunal in the case of Kantibhai Naranbhai Prajapati (supra) is squarely applicable to the facts of the instant case. Therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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