9911796707
TMI Blog2024 (6) TMI 1058X X X X Extracts X X X X X X X X Extracts X X X X ..... the penalty order passed u/s 271(1)(c) of the Income Tax Act, 1961 (in short 'Act') for the Assessment Year (A.Y. ) 2015-16. 2. Brief facts of the case are M/s Milk Producers & Employees Educational Health and Medical Welfare Trust, registered u/s 12A of the Act, filed it's return of income for the A.Y. 2015-16, declaring total income at Rs. Nil. Subsequently, search and seizure operation u/s 132 of the Act was conducted on 25.10.2016 in the case of Visakha Dairy Group. Consequent to the search, a notice u/s 153A was issued and served on the assessee on 23.06.2017. In response to the notice u/s 153A, the assessee filed it's return of income for the A.Y. 2015-16 on 15.07.2017, admitting total income of Rs. 4,37,66,000/-. Thereafter, notice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11 to 2016-17, as detailed in the assessment order. The Ld.AO considering the admission of the Managing Trustee concluded that the assessee has not disclosed the profit of Rs. 21,40,708/- as per the Profit & Loss Account, whereas the assessee has declared income on presumptive basis. The Ld. AO however has not disputed the gross income of the assessee. He therefore added an amount of Rs. 21,40,708/- to the returned income of the assessee. Further, the Ld.AO also observed that the assessee has created provision for expenditure amounting to Rs. 6,00,26,300/- to fulfil the criteria of 85% utilisation of receipts. The Ld. AO after examining the books of accounts found that the assessee has incurred expenditure to the extent of Rs. 1,89,26,698/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ata Pvt. Ltd., Vs. Commissioner of Income Tax (Civil Appeal No.9772 of 2013), wherein, it was held that the statute does not recognize the defences such as surrendering of additional sums to avoid litigation. iv. Any other ground of appeal that may arise at the time of hearing." 5. The Ld.DR argued that the assessee is engaged in the business activity by providing manpower supply to VVMPCL for collection of cash from the milk booths. The Ld.DR argued that admission by the Managing Trustee is consequent to the search and not voluntary and hence, levying of penalty is justifiable. He, therefore, pleaded that the order of the AO be sustained. The Ld.DR relied on the following case laws : i. Hon'ble Supreme Court of India in the case of MA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n which the admission was made. He, therefore, pleaded that the assessee has not concealed any particulars of income, but was under bonafide belief of claiming exemption, which should not be the basis for levying penalty u/s 271(1)(c) of the Act. The assessee also referred to Explanation 5A to section 271 of the Act. The Ld.AR, further submitted that the case law relied upon by the Ld.DR and the ratio laid down by the Hon'ble Supreme Court in MAK Data (P.) Ltd. Vs. Commissioner of Income Tax-II is distinguishable on the fact that the penalty levied in the instant case was on account of incriminating material impounded during the search. However, in the instant case, there is no such incriminating material, which leads to concealment of inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has fulfilled the obligation of incurring 85% of total receipts towards charity, amounting to Rs. 36.49 Crs, which is not disputed by the revenue authorities. Further, it is also found that the assessee has disclosed the cash collection receipts as business income, but has offered into tax by invoking the provisions of section 44AD of the Act under presumptive taxation scheme. During the search and seizure, it was found that the actual profit for the impugned assessment year, from it's business operations amounted to Rs. 26,76,396/-. However, there is no restriction to the assessee to offer the income u/s. 44AD of the Ac t on presumptive basis. We also find that the Ld. AO has not disputed the gross collections nor found any incriminating m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Parliament may not have intended. At any rate, the Commissioner was convinced on the facts that there was no act on the part of the respondent. It is only when the conclusions at the level of the Commissioner who happens to be the last authority on the facts are shown to be perverse or without any basis, that an occasion would arise for the Tribunal or for that matter, this Court to interfere with the same. Respectfully following the ratio laid down by the Hon'ble Jurisdictional High Court in CIT Vs. M/s Shakthi Industries (supra), we are of the view that mere admission of the additional income in the statement recorded u/s. 132(4) of the Act cannot be considered as concealment in the absence of any incriminating material disclosing such ..... X X X X Extracts X X X X X X X X Extracts X X X X
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