TMI Blog2019 (12) TMI 410X X X X Extracts X X X X X X X X Extracts X X X X ..... ty under the said section could be levied. As relying on DURGA KAMAL RICE MILLS VERSUS COMMISSIONER OF INCOME-TAX. [ 2003 (4) TMI 26 - CALCUTTA HIGH COURT] burden of proof in the penalty proceedings is independent and larger than in the assessment proceedings and the assessment proceedings and penalty proceedings are different. Findings in the assessment proceedings are not sufficient to impose penalty. Further, penalty cannot be imposed when assessment has been enhanced merely on estimates. Considering the facts of the case in totality, we do not find any error or infirmity in the findings of the ld. CIT(A). - Decided against revenue. - ITA No. 6905/DEL/2015 - - - Dated:- 6-12-2019 - Shri N.K. Billaiya, Accountant Member, An ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A) and the ld. CIT(A) disposed of the appeal vide order dated 26.12.2014. Quantum additions made by the Assessing Officer were deleted and considering that the assessee was involved in providing accommodation entries, commission income was estimated at ₹ 5,06,19,100/- and further addition in respect of pay orders amounting to ₹ 2,64,68,506/- and cash of ₹ 50 lakhs were also added. 7. After giving appeal effect, the Assessing Officer computed the income at ₹ 8,22,64,607/-and worked out undisclosed income at ₹ 7,64,26,117/- and proposed to levy penalty u/s 271AAA of the Act @ 10% tax on undisclosed income and computed the penalty at ₹ 76,42,611/-. 8. During the course of pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Penalty computed @10% ₹ 76,42,611/- Penalty imposed ₹ 76,42,6117- Penalty levied @ 10% of tax on undisclosed income ₹ 76,42,611/- 10. Penalty so levied was agitated before the ld. CIT(A) and once again the assessee pointed out that the provisions of section 271AAA of the Act do not apply on the facts of the case. It was brought to the notice of the ld. CIT(A) that penalty u/s 271AAA of the Act is attracted when search is conducted and the assessee is found to be having undisclosed income for specified years. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5/NAG/2015. 14. Per contra, the ld. counsel for the assessee reiterated what has been stated before the lower authorities. 15. We have given thoughtful consideration to the orders of the authorities below and have also considered the judicial decisions relied upon by the ld. representatives. A bare perusal of the penalty order shows that the Assessing Officer has levied the penalty mechanically by taking difference in the return of income and assessed income. Entire penalty order is devoid of any specific findings in respect of any specific seized material or undisclosed income detected as a result of search. In our understanding of the law, it was incumbent upon the Assessing Officer to first establish tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the purposes of this section, - (i) undisclosed income means- (i) any income of the specified previous year represented, either wholly or partly, by any money, bullion, jewellery or other valuable article or thing or any entry in the books of account or other documents or transactions found in the course of a search under section 132,which has- (A) not been recorded on or before the date of search in the books of account or other documents maintained in the normal course relating to such previous year; or (B) otherwise not been disclosed to the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 18. At the very outset, the third limb has to be excluded because no expense was found recorded in the books of account which represents any income of the specified previous year. 19. As mentioned elsewhere, while levying the penalty, the Assessing Officer has nowhere mentioned specifically any undisclosed income within the meaning of undisclosed income given u/s 271AAA of the Act. On the contrary, the facts available on record indisputably establish that the quantum of income confirmed by the ld. CIT(A) was purely on estimate basis and in our humble opinion, estimated income cannot be said to be undisclosed income within the meaning of section 271AAA of the Act. 20. In the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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