2020 (4) TMI 791

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..... ct, 1961. 3. Brief facts of the case are that a search under section 153A of the Act was carried out at the premises of Dhanjimama group of cases on 3.7.2012. A notice under section 153A was issued upon the assessee, and he filed his return of income on 14.8.2014 declaring total income at Rs. 1,65,30,860/-. The assessee has disclosed additional income of Rs. 9,98,000/-. The facts with regard to disclosure of this additional income, and how the ld.AO has initiated penalty proceedings qua this additional income is being noticed by the AO in the brief assessment order dated 31.1.2015. The relevant part reads as under: "4. The assessee in his return of income has offered additional income of Rs. 9,80,000/- which is as per the disclosure of .....

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..... additional income. The AO has not made any reference to the seized material in the assessment order. He took us through para 4 and 5.1 of the assessment extracted (supra). Thus, on the strength of the Tribunal's order in ITA No.1266/Ahd/2019 and others, he contended that no penalty can be imposed upon the assessee. On the other hand, the ld.DR relied upon the order of the ld.CIT(A). 6. With the assistance of the ld.representatives, we have gone through the record carefully. Explanation 5A appended to section 271(1)(c) has a direct bearing on the controversy, and therefore, we deem it appropriate to take note of this Explanation, which reads as under: "[Explanation 5A.-Where, in the course of a search initiated under section 132 on or af .....

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..... f accounts found during the course of search, based on such material, addition is being made. This Explanation cannot be invoked simply for the reason that, had the search not been carried out, the assessee would not have disclosed this additional income. Somewhat an identical situation was considered by the ITAT, Rajkot Bench in the case of Shri Mansukhbhai R. Sorathia and Others, in IT(SS)A.No.46 to 52/RJT/2012, wherein question before the Tribunal was, when no money, bullion, jewellery or book entry was found at the time of search, and only evidence against the assessee is an admission of additional income made in the statement under section 132(4), whether such admission tantamount to disclosure of money, bullion, jewellery or diary and .....

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