TMI Blog2020 (2) TMI 882X X X X Extracts X X X X X X X X Extracts X X X X ..... ts in confirming penalty imposed of ₹ 10,12,126/- u/s.271(1)(c) on account of alleged addition made at ₹ 32,13,100/(inclusive of enhanced income), without establishing any alleged facts/thing and bringing any corroborative evidence on record, even in penalty proceedings and hence, penalty be deleted 2] On the facts and in the prevailing circumstances of the case, the learned CIT(A) has grossly erred in confirming the penalty u/s.271(1)(c) of the I T Act, without rebutting any contention of the appellant filed before him. Therefore, penalty be deleted. 3] On the facts and in the prevailing circumstances of the case and in law the learned CIT(A) has grossly erred in confirming the penalty imposed by A.O without having jurisdiction to him to imposed such penalty on enhanced income to ₹ 32,13,100/-, hence, it is bad in law and it may please be deleted. 4] On the facts and in the prevailing circumstances of the case, the learned CIT(A) has grossly erred in confirming the penalty u/s.271 (1)(c) of the I T Act, even though A.O has not given any clear finding , as to whether it is imposed for furnishing inaccurate particulars of income , or for concealme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13,100/-. 5. Against the above said penalty order of the Assessing Officer, the assessee filed a further appeal before the CIT(A). The CIT(A) without establishing any alleged facts/thing and bringing any corroborative evidence on record confirmed the penalty as levied by the Assessing Officer. 6. Before us, ld. Counsel for the assessee submitted that the assessee carried the litigation on addition in quantum appeal to the Tribunal and got relief in favour of the assessee. Further, ld. Counsel for the assessee, by making a reference to the grounds, mentioned that the addition was deleted by the Pune Bench of the Tribunal in assessee s own case vide ITA No.1427/PUN/2011 dated 05.09.2019. In this regard, ld. AR brought our attention to the contents of para 4 and 5 of the order of the Tribunal (supra) for demonstrating the reasons for granting relief to the assessee. The ld. AR for the assessee further mentioned that the Tribunal granted relief to the assessee on the issue of penalties giving the reason that the penalty does not survive when the quantum addition is deleted. Thus, the ld. AR fairly mentioned that the Tribunal may take a view on the issue of penalty u/s 271(1)(c) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sel relied on the various decisions including the decision of the Pune Bench of the Tribunal in the case of Shri V. L. Khandge vs. ITO in ITA No.1971/PUN/2014 for the assessment year 2006-07 dated 24.04.2018 and submitted that this appeal also pertains to the period post-assessment year 2004-05 and the provisions of section 153C of the Act are applicable to the said case. On these facts, the Tribunal did not approve the Assessing Officer action in resorting to section 147 of the Act in reference to the provisions of section 153C of the Act. He also mentioned that the contents of para 7 to 11 of the said order of the Tribunal (supra) are relevant in this regard. 8. The ld. DR for the Revenue, on the other hand, relied heavily on the orders of the Assessing Officer and the CIT(A). 9. On hearing both the sides on this issue, I find the contents of para 7 to 11 of the order of the Tribunal (supra) are relevant to extract. For the sake of completeness of this order, the said para 7 to 11 of the order of the Tribunal (supra) are extracted hereunder :- 7. Briefly, in the facts of the case, the assessee had furnished return of income in time which was processed under sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions to the notice issued under section 148 of the Act. 8. The issue which arises before us is whether in such facts and circumstances of the case, where the basis of making investigation and assessment thereafter in the hands of assessee is on the basis of information unearthed during the course of search action on the premises of Shri Ganesh Khandge on 12.02.2013, then whether proceedings are to be initiated under section 148 or under section 153C of the Act. The perusal of provisions of section 153C of the Act reflects that in case any document relating to any other person is found during the course of search on a person, then the said document is to be forwarded to the Assessing Officer in-charge of the person other than the person searched. The proceedings have to be initiated against such person on the basis of such document found and impounded. Section 153C of the Act very clearly provided that where the conditions as mentioned in the said section prevail, then provisions of said section have to be applied notwithstanding anything contained in sections 139, 147, 148, 149, 151 and 153 of the Act. The requirement of section 153C of the Act is the first satisfaction o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de is section 153C of the Act which provides as under:- 153C. (1) Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that any money, bullion, jewellery or other valuable article or thing or books of account or documents seized or requisitioned belongs or belong to a person other than the person referred to in section 153A, then the books of account or documents or assets seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person and that Assessing Officer shall proceed against each such other person and issue such other person notice and assess or reassess income of such other person in accordance with the provisions of section 153A: Provided that in case of such other person, the reference to the date of initiation of the search under section 132 or making of requisition under section 132A in the second proviso to sub-section (1) of section 153A shall be construed as reference to the date of receiving the books of account or documents or assets seized or requisitioned by the Assessing Officer having jurisdicti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n searched; then first, all the said assets or information is to be handed over to the Assessing Officer, who is incharge of the person other than the person searched and then the Assessing Officer has to proceed and determine the income of the other person in accordance with provisions of section 153C of the Act. The said section very clearly also lays down that the provisions of section 153C of the Act are to be applied notwithstanding anything contained in sections 139, 147, 148, 151 and 153 of the Act. Applying the said provisions to the facts of the present case, wherein certain documents were found during the course of search at the residence of partners of assessee firm on the basis of which, additional income was to be assessed in the hands of partnership firm i.e. one of the assessees before us, then for making aforesaid addition, recourse which was open to the Assessing Officer was to initiate proceedings under section 153C of the Act. Where the provisions of said section are to be applied, then no proceedings can be initiated under section 147, 148, 151 and 153 of the Act. Accordingly, we hold that when during the course of search under section 132 of the Act at the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under consideration. Considering the above settled legal proposition on this issue (common in both the appeals), we do not find force in the order of the CIT(A). Accordingly, we set-aside the order of the CIT(A) and quash the reassessment orders made by the Assessing Officer. Thus, the relevant additional grounds/concise grounds raised by the assessee on the legal issue, common in the both appeals, are allowed. 9. Considering the above decision of the Tribunal in assessee s own case (supra), we find that the Tribunal deleted the additions on merits. Therefore, it is reasonable be infer that the Tribunal granted relief to the assessee on merits in quantum appeal. As such, there is no dispute on the issue of deletion of the said addition, which is the subject matter of the penalty. Accordingly, the impugned penalty levied u/s 271(1)(c) of the Act shall not survive. Considering the above fate of the factual matrix of the penalty, in our opinion, the order of the CIT(A) is required to be set-aside and the grounds raised by the assessee in the present appeal should be allowed in favour of the assessee. Accordingly, the grounds raised by the assessee in this appeal are allowed. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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