TMI Blog2019 (12) TMI 971X X X X Extracts X X X X X X X X Extracts X X X X ..... n 271(1)(c) of the Act. Penalty u/s 271AAB - assessee has disclosed additional income in pursuance to the return filed under section 153A - HELD THAT:- Penalty shall be imposed under section 271AAB of the Act where there is undisclosed income within the meaning of the explanation C to 271AAB of the Act. However, we note that there was no documentary evidence found by the search team suggesting that there was any undisclosed income of the assessee. As such the voluntary income disclosed by the assessee and the addition made by the AO was without having found any incriminating document in the course of search. We also note that there no reference made by the authorities below to the documents of incriminating nature having bearing on the income of the assessee in their respective orders. The ld. DR has not advanced any arguments against the contentions raised by the ld. AR for the assessee. See M/S. MARVEL ASSOCIATES VERSUS ACIT, CENTRAL CIRCLE-2, VISAKHAPATNAM [ 2018 (3) TMI 946 - ITAT VISAKHAPATNAM] - Decided in favour of assessee. - ITA No(s). 556/Ahd/2018, 557/Ahd/2018, 558/Ahd/2018, 560/Ahd/2018, 561/Ahd/2018, 562/Ahd/2018, 563/Ahd/2018, 564/Ahd/2018, 565/Ahd/2018, 566/A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re directed against the separate orders of the CIT(A)-12, Ahmedabad all dated 23/01/2018 for AYs 2007-08 to 2011-12 towards confirmation of penalty u/s.271(1)(c) of the Act and 271AAB of the Act for AYs 2012-13 2013-14. First we take the appeals in the case(s) of Dhanwantiben C. Darshiyani : ITA Nos. 587 to 592/Ahd/2018 for AYs 2008-09 to 592/Ahd/2018 These are six appeals filed by the assessee against the combined order of the Ld. Commissioner of Income Tax (Appeals)-12, Ahmedabad, dated 22/01/2018 the Assessment Years (AYs) 2008-09 to 2013-14. Since all the appeals relate to the same assessee, hence the same are heard analogously and are being disposed of by way of this common order. 2. First we take up assessee s appeal in ITA No. 587/Ahd/2018 for Asst. Year 2008-09. The assessee has raised the following grounds of appeal:- 1.00 IMPOSITION OF PENLATY TO THE TUNE OF ₹ 2,89,300/- ON ADDITION MADE ON ACCOUNT OF UNDISCLOSED INCOME. 1.01 On the facts and circumstances of appellant's case and in law, the ld. CIT (Appeals) has erred in confi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fered in the return filed and the addition made for the land transaction deal as discussed above in the assessment framed under section 153A/143(3) of the Act. 3.2 The assessee in response to such notice vide letter dated 7th August 2015 submitted that there was no incriminating material found during the search proceedings. As such the additional income of ₹ 4,05,795/- was voluntarily offered. 3.3 Similarly, the addition of ₹ 3,77,790.00 was accepted as she (the assessee) failed to record such transaction due to oversight but the same does not amount either concealment of income or furnishing inaccurate particulars of income. Moreover all the relevant records were available with the Revenue and the information was provided by the Revenue regarding the income from land transactions deals. 3.4 The assessee also claimed that there is no specific charged mentioned in the assessment/ notice whether it was concealment or furnishing inaccurate particulars of income. 3.5 The assessee further claimed that there was no deliberate act on her part either to conceal the income or furnishing the inac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. But the ITAT has deleted such penalty. The learned AR also furnished the list of such orders of the tribunal as detailed under: Pramod J. Daswani IT(ss) No.264/Ahd/2017, ITAT Order dated 14/10/2019, as per page 73 to 75 of paper book filed on 13/11/2019. Guruprasad Infrastructure ITA No.1658/Ahd/2017, ITAT order dated 19/07/2019, as per page 1 to 11 of paper book filed on 13/11/2019. Parag V.Chugh ITA No.581 to 586/Ahd/2018, ITAT Order dated 16/10/2019, as per page 102 to 112 of paper book filed on 13/11/2019. 7. On the contrary, the ld. DR submitted that the additional income was offered to tax by the assessee as a result of search proceeding carried out under section 132 of the Act. The ld. DR vehemently supported the order of the Authorities Below. 8. We have heard the rival contentions of both the parties and perused the materials available on record. The penalty in the case on hand was levied under explanation 5A of section 271(1)(c) of the Act which reads as under: [Explanation 5A.-Where, in the co urse of a search initiated under section 132 on or after t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re was also no mentioned of any incriminating document in relation to the addition of ₹ 3,77,790.00 on the basis of which the addition was made by the Revenue. Thus, it is inferred that such addition was not based on the document found during the course of search. 8.4 Now the question arises, whether the assessee can be visited with the penalty with respect to the income disclosed by him in such proceedings voluntarily and without finding any incriminating document during the course of search. To our mind the answer stands in favour of the assessee. In holding so we draw support and guidance from the order of ITAT in the case of Ajay Traders Vs. DCIT reported in 81 taxmann.com 463, wherein it was held as under: The assessee disclosed an additional income on account of unaccounted sales. Based on said disclosures, the Assessing Officer imposed penalty under section 271(1)(c) by invoking Explanation 5A to said section. Held that it was undisputed fact that during the course of search, no incriminating documents were found and seized. The assessee surrendered the additional income under section 132(4) at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Ld. CIT (A). Hence, the ground of appeal of the assessee is allowed. 11. In the result, these appeals of the assessee are also allowed. Coming to the assessee s appeal bearing ITA No. 591/Ahd/2018 for the AY 2012- 13. The only issue raised by the assessee is that the ld. CIT(A) erred in confirming the penalty imposed by the AO for ₹ 11,28,165.00 under section 271AAB of the Act. 12. The assessee has disclosed additional income of ₹ 1,06,36,545.00 in pursuance to the return filed under section 153A of the Act. However, the AO further made the addition of ₹ 2,15,039.00 on account of the income of land transactions deal. Thus the assessment was framed after making the impugned addition to the total income at ₹ 1,20,29,399.00 only under section 153A r.w.s. 143(3) of the Act vide order dated 20-03-2015. 12.1 Subsequently, the AO further on such additional income disclosed by the assessee and the income added in the assessment levied the penalty of ₹ 11,28,165.00 under the provisions of section 271AAB of the Act. The learned CIT (A) also confirmed the order of the AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed.] 15.1 From the above provision, it is clear that the penalty shall be imposed under section 271AAB of the Act where there is undisclosed income within the meaning of the explanation to 271AAB of the Act. However, we note that there was no documentary evidence found by the search team suggesting that there was any undisclosed income of the assessee. As such the voluntary income disclosed by the assessee and the addition made by the AO was without having found any incriminating document in the course of search. We also note that there no reference made by the authorities below to the documents of incriminating nature having bearing on the income of the assessee in their respective orders. The ld. DR has not advanced any arguments against the contentions raised by the ld. AR for the assessee. In holding so we draw support and guidance from the order of the Tribunal in the case of ACIT Vs. Marvel Associates reported in 170 ITD 353 wherein it was held as under: 9. Penalty u/s 271AAB attracts on undisclosed income but not on admission made by the assessee u/s 132(4). The AO must establish that there is undisclosed income on the basi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expenditure. The Hon'ble ITAT Delhi Bench in the case of Ajay Sharma v. Dy. CIT [2013] 30 taxmann.com 109 held that with respect to the addition on account of alleged receivables as per seized paper, there is no direct material which leads and establishes that any income received by the assessee has not been declared by the assessee. An addition has been made on the basis of loose document, which did not closely prove any concealment or furnishing of inaccurate particulars by the assessee. Hence penalty u/s 158BFA (2) of the Act is not leviable. The facts of the assessee's case shows that there was no undisclosed income found during the course of search and no incriminating material was found, hence we hold that there is no case for imposing penalty u/s 271AAB of the Act, accordingly, we set aside the order of the lower authorities and cancel the penalty u/s 271AAB of the Act. 15.2 We are also conscious to the fact that the impugned penalty was deleted in the case of other assessees who were part of the group and subject to the same search vis-a-vis involving identical facts and circumstances. The details of such cases have already been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. CIT (A). Hence, the ground of appeal of the assessee is allowed. 21. In the result the appeal of the assessee in ITA No.569/Ahd/2018 for AY 2012-13 is allowed. Coming to the assessee appeals in the case(s) of Mukesh B. Manglani: Coming to ITA Nos. 556/AHD/2018 for the AY 2011-12 22. At the outset, we note that in the identical facts and circumstances, we have deleted the penalty imposed under section 271(1)(c) of the Act vide Paragraph No. 8 of this order in the case of Dhanwantiben C. Darshiyani (supra) in ITA No. 587/AHD/2018 . Respectfully, following the same, we delete the penalty imposed by the AO which was subsequently confirmed by the Ld. CIT (A). Hence, the ground of appeal of the assessee is allowed. 23. In the result, the appeal of the assessee in ITA No.556/Ahd/2018 for AY 2011-12 is also allowed. Coming to ITA Nos. 557 558/AHD/2018 for the AYs 2012-13 and 2013-14 24. At the outset, we note that in the identical facts and circumstances, we have deleted the penalty imposed under section 271AAB of the Act vide Paragraph No. 15 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the AO which was subsequently confirmed by the Ld. CIT (A). Hence, the ground of appeal(s) of the assessee is allowed. 31. In the result, all the five appeals of the assessee in ITA No.593 to 597/Ahd/2018 for AYs 2007-08 to 2011-12 are also allowed. Coming to ITA Nos. 598 599/AHD/2018 for the AYs 2012-13 2013-14 32. At the outset, we note that in the identical facts and circumstances, we have deleted the penalty imposed under section 271AAB of the Act vide Paragraph No. 15 of this order in the case Dhanwantiben C. Darshiyani (supra) in ITA No. 591/AHD/2018. Respectfully, following the same, we delete the penalty imposed by the AO which was subsequently confirmed by the Ld. CIT (A). Hence, the ground of appeal(s) of the assessee is allowed. 33. In the result, both the appeals of the assessee in ITA Nos.588 599/Ahd/2018 for AYs 2012-13 2013-14 are allowed. Coming to assessee appeals in the case(s) of Kamlesh D. Mangalani 34. The learned counsel for the assessee, at the time of hearing, sought an adjournment but we decline the same on the reasoning that the ..... 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