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TMI Blog2022 (6) TMI 563X X X X Extracts X X X X X X X X Extracts X X X X ..... for short 'the Act') pertaining to assessment year 2012-13. 2. Though, in the impugned order, learned Commissioner (appeals) has disposed of the appeals relating to three assessment years, however, presently, we are concerned with assessment year 2012-13. 3. Briefly the facts are, the assessee, since deceased, was a resident individual. For the assessment year under dispute, the assessee had filed his return of income on 28.07.2012 declaring income of Rs.9,87,75,340/-. It is relevant to observe, on 09.11.2011, a search and seizure operation under section 132 of the Act was conducted on the assessee, wherein, information was found that the assessee was operating a foreign bank account at HSBC Geneva. Further, in course of search and seizur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Commissioner (Appeals) having found that the addition made on account of unexplained jewellery, in the meanwhile, was deleted by the Tribunal, deleted the penalty imposed under section 271AAA of the Act in respect of the additions made of Rs.1,12,89,646/- representing unexplained jewellery. However, insofar as the addition of Rs.11,82,500/- on account of cash found in course of search, learned Commissioner (Appeals) confirmed the penalty imposed with the observation that the manner in which cash was derived was not specified by the assessee. Accordingly, he held that the assessee was unable to satisfy all the criteria laid down in section 271AAA of the Act. 5. Drawing out attention to the statement recorded under section 132(4) of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ific answer. He submitted, only because, according to the department, there is no proper explanation by the assessee with regard to the manner in which undisclosed income was derived, penalty under section 271AAA cannot be levied. He submitted, penalty under section 271AAA of the Act is not mandatory. Therefore, if the assessee offers a reasonable explanation, no penalty can be imposed. Further, he submitted, once the department accepts the voluntary disclosure of income made by the assessee, no penalty under section 271AAA can be imposed. In support of his contention, learned counsel for the assessee relied upon a number of judicial precedents as referred to in the written submission filed before us. 6. Strongly relying upon the observati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal while deciding assessee's appeal. Thus, the only amount which could have been subjected to levy of penalty under section 271AAA is cash found of Rs.11,82,500/-. The question which arises for consideration is, whether penalty under section 271AAA can be imposed when the assessee has offered the amount as undisclosed income in course of search and seizure operation. For better appreciation, it is necessary to have a look at the provision contained under subsection (2) of section 271AAA of the Act, which reads as under: "Penalty where search has been initiated. 271AAA. (1) ...................................... (2) Nothing contained in sub-section (1) shall apply if the assessee,- (i) in the course of the search, in a statement u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us, in course of search and seizure operation when the assessee came forward and offered certain income to show his bonafide and ultimately followed it up by actually offering such income to tax, in our view, the assessee should be given the benefit of the exceptions provided under sub-section (2) of section 271AAA. In any case of the matter, it is a fact on record that the assessee is no more and has been substituted by his legal heir, in course of proceeding before us. Thus, in our considered opinion, a liberal and compassionate view has to be taken qua the imposition of penalty under section 271AAA of the Act. Accordingly, we delete the penalty imposed under section 271AAA of the Act. Grounds are allowed. 9. In the result, the appeal is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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