D.C.I.T CC - V,kolkata, Kolkata V. Krishna Trade & Commerce Pvt Ltd, Kolkata

ITA 1083/KOL/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 4973 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 11 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2016
• Appeal Filed By: Department
• Bench Allotted: C
• Next Hearing Date: 26-04-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 06-05-2013
• Court: TRIBUNAL
• Department Lawyers: N O N E
• Assessee Lawyers: K K CHHAPARIA
• Keywords: Unexplained investment; Business income; Search and seizure; Transactions in derivatives; Tax effect; Revised return
• Section: 143(3); 153A; 132

Judgement Text

I.T.A. NO. 1083/ KOL./2013 ASSESSMENT YEAR: 2009-2010 PAGE 1 OF 13 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA C BENCH, KOLKATA BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER I.T.A. NO. 1083/KOL/2013 ASSESSMENT YEAR: 2009-10 DEPUTY COMMISSIONER OF INCOME TAX,................. ...................APPELLANT CENTRAL CIRCLE-V, KOLKATA, AAYAKAR BHAWAN POORVA, 3 RD FLOOR, 110, SHANTIPALLY, KOLKATA-700 107 -VS.- KRISHNA TRADE & COMMERCE PVT. LIMITED,............. ..............RESPONDENT MUKTI CHAMBER, 4A, CLIVE ROW, KOLKATA-700 001 [PAN : AABCK 2111 L] APPEARANCES BY: N O N E, FOR THE DEPARTMENT SHRI K.K. CHHAPARIA, FCA, FOR THE ASSESSEE DATE OF CONCLUDING THE HEARING : APRIL 26, 2016 DATE OF PRONOUNCING THE ORDER : APRIL 29, 2016 O R D E R PER SHRI P.M. JAGTAP :- THIS APPEAL IS PREFERRED BY THE REVENUE AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS), CENTRAL-1, KO LKATA DATED 04.02.2013, WHEREBY HE CANCELLED THE PENALTY OF RS. 17,50,000/- IMPOSED BY THE ASSESSING OFFICER UNDER SECTION 271AAA OF TH E INCOME TAX ACT, 1961. 2. THE ASSESSEE IN THE PRESENT CASE IS A COMPANY, W HICH IS ENGAGED IN THE BUSINESS OF TRADING AND INVESTMENT. THE RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION WAS ORIGINALLY FILED BY IT ON 2 5.09.2009 DECLARING A LOSS OF RS.19,06,520/-. A SEARCH AND SEIZURE ACTION UNDER SECTION 132 WAS CONDUCTED ON 11.09.2009 IN THE CASE OF THE ASSESSEE AS WELL AS IN THE I.T.A. NO. 1083/ KOL./2013 ASSESSMENT YEAR: 2009-2010 PAGE 2 OF 13 CASES OF M/S. SALASAR STOCK BROKING LIMITED AND M/S . SHREE SALASAR PROPERTIES AND FINANCE PVT. LIMITED. IN THE DISCLOS URE PETITION FILED IN CONSEQUENCE OF THE SAID ACTION BEFORE THE ADIT(INVE STIGATION), THE ASSESSEE DISCLOSED ADDITIONAL INCOME OF RS.1,75,00, 000/- FOR THE YEAR UNDER CONSIDERATION ON ACCOUNT OF SHARE CAPITAL RAI SED IN THAT YEAR INCLUDING SHARE PREMIUM BY STATING THAT THE EVIDENC ES REQUIRED IN SUPPORT OF SOURCE OF SUCH SHARE CAPITAL MIGHT NOT B E READILY AVAILABLE. IN THE RETURN OF INCOME FILED IN RESPONSE TO NOTICE UN DER SECTION 153A ON 31.05.2010, THE ASSESSEE OFFERED TO TAX THIS ADDITI ONAL INCOME DISCLOSED AS A RESULT OF SEARCH AND IN THE ASSESSMENT COMPLET ED UNDER SECTION 143(3) READ WITH SECTION 153A VIDE AN ORDER DATED 0 9.05.2011, THE ASSESSING OFFICER ACCEPTED THE ADDITIONAL INCOME SO OFFERED BY THE ASSESSEE AND COMPUTED THE TOTAL INCOME OF THE ASSES SEE AT RS.1,56,62,980/- AFTER MAKING CERTAIN PETTY ADDITIO NS. PENALTY PROCEEDINGS UNDER SECTION 271AAA WERE ALSO INITIATE D BY THE ASSESSING OFFICER AND IN RESPONSE TO THE SHOW-CAUSE NOTICE IS SUED DURING THE COURSE OF THE SAID PROCEEDINGS, A REPLY WAS FILED BY THE A SSESSEE INVITING THE ATTENTION OF THE ASSESSING OFFICER TO THE FOLLOWING RELEVANT PORTION OF THE DISCLOSURE PETITION FILED AS A RESULT OF SEARCH:- WE ARE A NON-BANKING FINANCIAL COMPANY AND WE ARE INTO THE BUSINESS OF FINANCIAL ACTIVITIES AND RELATED SE CTOR. WE HAVE PROCURED FINANCE IN THE FORM OF SHARE CAPITAL AND LOANS AND SUCH FUNDS ARE ROUTED INTO ACTIVITIES OF FINANC IAL SECTOR. SUCH FUNDS HAVE BEEN RAISED FROM VARIOUS SOURCES. Y OUR GOODSELF HAS RAISED A QUERY ON EXPLAINING THE SOURC ES OF ALL SUCH RECEIPTS. WE HAVE BEEN CARRYING OUT REGULAR AN D BONAFIDE TRANSACTIONS. HOWEVER, WE ARE NOT ABLE TO INSTANTLY PRODUCE ALL THE RELEVANT DOCUMENTATION OR PAPER WOR K WHICH MAY BE REQUIRED BY THE DEPARTMENT. HENCE TO DEMONSTRATE OUR COOPERATIVE ATTITUDE AND TO AVOID UNNECESSARY LONG DRAWN LITIGATIONS WITH THE DEPARTM ENT AND TO BUY PEACE, WE ARE OFFERING AN ADDITIONAL INCOME OF RS.1,75,00,000/- FOR FINANCIAL YEAR 2008-09....... 3. IT WAS SUBMITTED BY THE ASSESSEE BEFORE THE LD. CIT(APPEALS) THAT THE DISCLOSURE OF RS.1,75,00,000/- THUS WAS MADE TO AVOID LONG-TERM I.T.A. NO. 1083/ KOL./2013 ASSESSMENT YEAR: 2009-2010 PAGE 3 OF 13 LITIGATIONS AND TO BUY PEACE AS THEY WERE INSTANTLY NOT ABLE TO PRODUCE ALL THE RELEVANT DOCUMENTATION OR PAPER WORK AS REQUIRE D BY THE DEPARTMENT. IT WAS ALSO POINTED OUT THAT THE RELEVA NT TRANSACTIONS AS CARRIED ON BY THE ASSESSEE WERE CLAIMED TO BE BONAF IDE IN THE DISCLOSURE PETITION AND IN THE ASSESSMENT COMPLETED UNDER SECT ION 143(3) READ WITH SECTION 153A, THERE WAS NOTHING BROUGHT ON RECORD B Y THE ASSESSING OFFICER TO DISPUTE THIS POSITION. IT WAS CONTENDED THAT THE AMOUNT OF RS.1,75,00,000/- DISCLOSED BY THE ASSESSEE AS A RES ULT OF SEARCH THUS COULD NOT BE CATEGORIZED AS UNDISCLOSED INCOME SO A S TO ATTRACT THE PENAL PROVISIONS OF SECTION 271AAA. THIS CONTENTION OF TH E ASSESSEE WAS NOT FOUND ACCEPTABLE BY THE ASSESSING OFFICER. ACCORDIN G TO HIM, THE AMOUNT OF RS.1.75 CRORES WAS DISCLOSED BY THE ASSESSEE AS ITS INCOME AS A RESULT OF ITS FAILURE TO PROVE THE GENUINENESS OF THE RELE VANT TRANSACTION AND BUT FOR THE SEARCH, THE ASSESSEE WOULD NOT HAVE DISCLOS ED THE SAME. HE ALSO HELD THAT THERE WAS A FAILURE ON THE PART OF THE AS SESSEE TO SUBSTANTIATE THE MANNER IN WHICH THE SAID UNDISCLOSED INCOME WAS DERIVED AND, THEREFORE, IT WAS NOT ENTITLED TO GET IMMUNITY FROM IMPOSITION OF PENALTY AS LAID DOWN IN SUB-SECTION (2) OF SECTION 271AAA. ACCORDINGLY THE ASSESSING OFFICER PROCEEDED TO IMPOSE PENALTY OF RS .17,50,000/- UNDER SECTION 271AAA BEING 10% OF THE UNDISCLOSED INCOME OF RS.1.75 CRORES. 4. THE PENALTY IMPOSED BY THE ASSESSING OFFICER UND ER SECTION 271AAA WAS CHALLENGED BY THE ASSESSEE IN AN APPEAL FILED B EFORE THE LD. CIT(APPEALS) AND AFTER CONSIDERING THE SUBMISSIONS MADE BY THE ASSESSEE AND BY RELYING ON THE VARIOUS JUDICIAL PRONOUNCEMEN TS, THE LD. CIT(APPEALS) DELETED THE PENALTY IMPOSED BY THE ASS ESSING OFFICER UNDER SECTION 271AAA FOR THE FOLLOWING REASONS GIVEN IN P ARAGRAPHS NO. 12 TO 15 OF HIS IMPUGNED ORDER:- 12. I HAVE PERUSED THE PENALTY ORDER OF THE AO. I HAVE ALSO CONSIDERED THE SUBMISSIONS MADE ON BEHALF OF THE AP PELLANT AND THE JUDICIAL PRONOUNCEMENTS RELIED UPON. THE AO HAS CON CLUDED IN HIS PENALTY ORDER THAT THE DISCLOSURE OF RS.1.75 CRORES MADE U/S 132(4) WAS THE UNDISCLOSED INCOME OF THE APPELLANT ON THE GROUND THAT THE I.T.A. NO. 1083/ KOL./2013 ASSESSMENT YEAR: 2009-2010 PAGE 4 OF 13 DISCLOSURE SO MADE WAS NOT INCLUDED IN THE RETURN F ILED U/S 139(1); AND, THAT THE APPELLANT FAILED TO PROVE THE GENUINE NESS OF THE TRANSACTIONS WHEREBY IT HAD RECEIVED MONEY BY WAY O F ADVANCE, MARGIN MONEY AND DEPOSITS, ETC. WHICH WOULD NOT HAV E BEEN DISCLOSED BUT FOR THE SEARCH U/S 132. THE AO FURTHE R NOTED THAT THE APPELLANT FAILED TO SUBSTANTIATE THE MANNER IN WHIC H THE UNDISCLOSED INCOME WAS DERIVED; AND CONSEQUENTLY, IT WAS NOT EN TITLED TO IMMUNITY FROM PENALTY U/S 271AAA. THE AO REJECTED T HE JUDICIAL DECISIONS RELIED UPON BY THE APPELLANT ON THE GROUN D THAT THEY WERE DELIVERED IN RESPECT OF THE PENALTY PROVISIONS U/S. 271(1)(C). 13. THE LD AR HAS EXPLAINED THAT THE CONTENTION OF THE AO THAT THE DISCLOSURE MADE ULS 132(4) WAS NOT INCLUDED IN THE RETURN FILED U/S 139(1) WAS NOT ONLY FACTUALLY INCORRECT BUT ALSO MI SLEADING. FOR, THE DISCLOSURE WAS MADE ON THE CONCLUSION OF THE SEARCH ON 07-11-2009 WHEN THE RETURN U/S 139(1) HAD ALREADY BEEN FILED T O COMPLY WITH THE DUE DATE FOR FILING OF THE RETURN. THUS, WHEN T HE RETURN U/S 139(1) WAS FILED, NO DISCLOSURE HAD BEEN MADE BY TH E APPELLANT; AND SO, IT WAS FACTUALLY: INCORRECT AND MISLEADING FOR THE AO TO STATE THAT THE DISCLOSURE MADE U/S 132(4) WAS NOT INCLUDED IN THE RETURN FILED U/S 139(1). THE APPELLANT HAD MADE THE DISCLOSURE O N 07-11-2009 WHICH WAS INCLUDED IN THE RETURN FILED IN RESPONSE TO THE NOTICE U/S 153A. I FIND FROM THE COPY OF THE PANCHANAMA (FILED AT PAGES 39 TO 45 OF THE PAPER-BOOK) THAT SEARCH WAS CONDUCTED AT THE APPELLANT'S PREMISE AT 4A, CLIVE ROW, KOLKATA ON 07-11-2009 WHI CH WAS IN CONTINUANCE OF THE SEARCH PROCEEDINGS ON 11/12-09-2 009. THE DISCLOSURE U/S 132(4) WAS MADE ON THE CONCLUSION OF THE SEARCH WHEN THE RETURN U/S 139(1) HAD ALREADY BEEN FILED. BUT, EVEN OTHERWISE, I AM OF THE OPINION THAT IN ORDER TO AVA IL THE BENEFITS OF SUB-SECTION (2) OF SECTION 271AAA, IT IS NOT NECESS ARY THAT THE DISCLOSURE U/S 132(4) SHOULD BE INCLUDED IN THE RET URN FILED U/S 139(1). IT WOULD SUFFICE IF THE ADDITIONAL INCOME D ISCLOSED U/S 132(4) WAS INCLUDED IN THE RETURN FILED U/S 153A AN D THE TAX ALONG WITH THE INTEREST WAS PAID. 14. THE LD AR HAS DRAWN MY ATTENTION TO THE ASSESSM ENT ORDER WHEREIN THE AO HAS MENTIONED THAT CERTAIN BOOKS OF ACCOUNT, CASH AND THE BANK ACCOUNTS WERE FOUND IN COURSE OF THE S EARCH. THE AO HAS ALSO MENTIONED ABOUT THE DISCLOSURE MADE U/S 13 2(4). THE AO HAS ACCEPTED THE DISCLOSURE MADE BY THE APPELLANT A S SHOWN IN THE RETURN FILED IN RESPONSE TO THE NOTICE U/S 153A. I FIND FROM THE ASSESSMENT ORDER THAT THE AO HAS MADE NO DISCUSSION ABOUT ANY OF THE SEIZED MATERIAL WHICH COULD EVEN REMOTELY SUGGE ST THAT THE APPELLANT HAD EARNED THE UNDISCLOSED INCOME FOR WHI CH THE DISCLOSURE WAS MADE U/S 132(4). THERE IS NO FINDING OF THE AO AS TO WHETHER THE DISCLOSURE MADE BY THE APPELLANT WAS IN ACCORDANCE WITH THE EVIDENCE COLLECTED IN THE SEARCH, IT IS TH US APPARENT THAT THE ADDITIONAL INCOME BY WAY OF DISCLOSURE U/S 132(4) W AS VOLUNTARILY OFFERED BY THE APPELLANT. THE APPELLANT HAD CONTEND ED IN COURSE OF I.T.A. NO. 1083/ KOL./2013 ASSESSMENT YEAR: 2009-2010 PAGE 5 OF 13 THE PENALTY PROCEEDINGS THAT THE DISCLOSURE U/S 132 (4) WAS MADE VOLUNTARILY WITH A VIEW TO PURCHASE PEACE AND THAT THE SAME WAS NOT BASED ON ANY EVIDENCE OR DOCUMENT RECOVERED IN COUR SE OF THE SEARCH. THESE CONTENTIONS HAVE NEITHER BEEN DISPUTE D NOR DISPROVED BY THE AO IN HIS PENALTY ORDER. THE APPELLANT HAS I NCLUDED THE ADDITIONAL INCOME IN THE RETURN FILED U/S 153A AND HAS ALSO PAID THE TAX ALONG WITH INTEREST ON SUCH ADDITIONAL INCOME. AFTER A PERUSAL OF THE ASSESSMENT ORDER, I FIND MERIT AND SUBSTANCE IN THE SUBMISSION THAT THE DISCLOSURE U/S 132(4) WAS MADE VOLUNTARILY WITH A VIEW TO PURCHASE PEACE AND THAT THE SAME WAS NOT BASED ON A NY EVIDENCE OR DOCUMENT RECOVERED IN COURSE OF THE SEARCH; AND ALS O, THAT THE AO COULD FIND NO DEFECT OR INFIRMITY IN THE BOOKS OF A CCOUNT OR- DOCUMENTS FOUND IN COURSE OF THE SEARCH. THE AO HAS NOTED IN HIS PENALTY ORDER THAT THE APPELLANT FAILED TO PROVE TH E GENUINENESS OF THE TRANSACTIONS WHEREBY IT HAD RECEIVED MONEY BY W AY OF ADVANCE, MARGIN MONEY AND DEPOSITS, ETC (THE AO POSSIBLY MEA NT MONEY BY WAY OF SHARE CAPITAL AND LOAN). BUT THEN, THE AO HA S NOT IDENTIFIED ANY SPECIFIC TRANSACTION REGARDING RECEIPT OF MONEY WHICH WAS NOT GENUINE. THE ASSESSMENT ORDER OF THE AO CONTAINS NO ADVERSE FINDINGS IN THIS REGARD. THE AO HAS SIMPLY ACCEPTED THE DISCLOSURE MADE BY THE APPELLANT AS SHOWN IN THE RETURN FILED IN RESPONSE TO THE NOTICE U/S 153A. BUT THEN, THE MATERIAL ON RECORD S UGGESTS THAT THE DISCLOSURE WAS MADE VOLUNTARILY AND THAT IT WAS NOT BASED ON ANY DOCUMENTS FOUND IN COURSE OF THE SEARCH. THE AO HAS MERELY RELIED UPON THE DISCLOSURE MADE BY THE APPELLANT AT THE TI ME OF THE CONCLUSION OF THE SEARCH. BUT THEN, THE DISCLOSURE PETITION FILED BY THE APPELLANT HAS TO BE CONSIDERED IN TOTALITY. THE APPELLANT HAD CLEARLY AND CATEGORICALLY MENTIONED IN THE DISCLOSU RE PETITION THAT IT HAD BEEN CARRYING OUT REGULAR AND BONAFIDE TRANSACT IONS, WHICH HAS NOT BEEN DISPROVED BY THE AO. THE APPELLANT HAD ALS O STATED THAT THE DISCLOSURE WAS BEING MADE TO AVOID UNNECESSARY LONG DRAWN LITIGATIONS WITH THE DEPARTMENT AND TO BUY PEACE. T HE FACTS OF THE PRESENT CASE SUGGEST THAT THE ADDITIONAL INCOME DIS CLOSED U/S 132(4) DOES NOT REPRESENT ANY UNDISCLOSED ASSET OR UNRECORDED ENTRY IN THE BOOKS OF ACCOUNT OR FALSE EXPENSE. IN VIEW O F THE ABOVE, I AM OF THE CONSIDERED OPINION THAT THE AO WAS NOT JUSTIFIE D IN HOLDING THAT THE ADDITIONAL INCOME OF RS.1. 75 CRORES DISCLOSED U/S 132(4) WAS THE UNDISCLOSED INCOME OF THE APPELLANT WITHIN THE MEAN ING OF SECTION 271AAA; AND CONSEQUENTLY, THE SAID DISCLOSURE CANNO T BE MADE SUBJECT MATTER OF PENAL PROCEEDINGS U/S 271AAA. IT WAS ALSO CONTENDED IN COURSE OF THE APPELLATE PROCEEDINGS TH AT THE ADDITIONAL INCOME DISCLOSED U/S 132(4) WAS NOT ACTUALLY EARNED WHICH WAS EVIDENT FROM THE AUDITED FINAL ACCOUNTS AS THE DISC LOSURE DOES NOT FIND PLACE IN THE PROFIT AND LOSS ACCOUNT. THE DISC LOSURE WAS SIMPLY INCLUDED IN THE RETURN FILED IN RESPONSE TO THE NOT ICE U/S 153A. I FIND FORCE IN THE ARGUMENT THAT WHEN THERE WAS NO UNDISC LOSED INCOME WHICH WAS ACTUALLY EARNED, THE QUESTION OF DESCRIBI NG THE MANNER IN WHICH IT WAS EARNED OR SUBSTANTIATING THE SAME DOES NOT ARISE. IN THE CASE OF PRAMOD KUMAR LAIN VS DCIT 149 TTJ (CTK)(UO) 36, THE HON'BLE ITAT CUTTAK BENCH HAS HELD THAT LEVY OF PEN ALTY U/S 271AAA WAS NOT JUSTIFIED ON THE GROUND THAT THE ASSESSEE F AILED TO SPECIFY THE MANNER IN WHICH THE UNDISCLOSED INCOME ADMITTED U/S 132(4) WAS DERIVED. IN THE CASE OF DCIT VS SULOCHANADEVI A AGA RWAL ITA NO I.T.A. NO. 1083/ KOL./2013 ASSESSMENT YEAR: 2009-2010 PAGE 6 OF 13 1052/AHD/2012, THE HON'BLE ITAT AHMEDABAD BENCH DEL ETED THE PENALTY U/S 271AAA BY HOLDING THAT SUBSTANTIATION O F THE MANNER IN WHICH THE UNDISCLOSED INCOME ADMITTED U/S 132(4) HA D BEEN DERIVED WAS NOT NECESSARY FOR IMMUNITY FROM PENALTY U/S 271 AAA. 15. THE AO HAS REJECTED THE JUDICIAL DECISIONS RELI ED UPON BY THE APPELLANT ON THE GROUND THAT THEY ARE RELATED TO TH E PENALTY PROVISIONS U/S 271(1)(C). BUT THEN, THE COURTS HAVE LAID DOWN THE BASIC PRINCIPLES WHICH ARE AVAILABLE FOR GUIDANCE W HILE DECIDING ANY PENAL PROCEEDINGS, IN THE CASE OF VINOD K BHAGAT VS ACIT (2009) 118 ITD 574, IT WAS HELD THAT PENALTY PROVISIONS DO NOT LIE WHERE THE VERY BASIS FOR THE IMPOSITION OF THE PENALTY WAS TH E ADDITIONAL INCOME DISCLOSED BY THE ASSESSEE RU/S 132(4). IN TH E CASE OF TANVIRKUMAR DIAMONDS LTD VS ACIT (2009) 32 SOT 272, IT WAS HELD THAT NO PENALTY COULD BE LEVIED IN THE CASE OF AN A SSESSEE WHO HAS MADE A DECLARATION U/S 132(4) REGARDING THE UNDISCL OSED INCOME AND THE MANNER IN WHICH IT WAS EARNED; AND, HAS ALS O PAID THE TAX IN RESPECT OF SUCH UNDISCLOSED INCOME. IN THE CASE OF SUDHARSAN SILK & SAREES 300 ITR 205, THE HON'BLE SUPREME COURT HAS H ELD THAT WHERE THE ASSESSEE HAS MADE THE DISCLOSURE FOR THE PURPOS ES OF BUYING PEACE AND THE ASSESSMENT WAS BASED ON SUCH DISCLOSU RE, THEN EVEN IF NO ASSURANCE IN WRITING WAS GIVEN BY THE SEARCHING PARTY, IT MAY BE SAFELY INFERRED THAT SUCH AN INDUCEMENT MUST HAVE B EEN GIVEN BY THE SEARCHING PARTY. FOR, WHEN ONLY PARTIAL EVIDENCE OR NO EVIDENCE IN SUPPORT OF THE CONCEALMENT WAS DETECTED DURING THE SEARCH, WHY WOULD A PERSON GO TO OFFER A HIGHER AMOUNT UNLESS H E WAS PROMISED SOME RECIPROCAL BENEFITS LIKE NOT BEING VISITED WIT H PENALTY. THE APEX COURT HAS CONCLUDED THAT WHERE THE ASSESSMENT WAS BASED ON THE DISCLOSURE MADE BY THE ASSESSEE, THEN THE PENAL TY PROVISION SHALL NOT LIE. I FIND THAT THE BASIC PRINCIPLES AS LAID D OWN IN THE ABOVE JUDICIAL DECISIONS ARE SQUARELY APPLICABLE IN THE P RESENT CASE. AGGRIEVED BY THE ORDER OF THE LD. CIT(APPEALS), THE REVENUE HAS PREFERRED THIS APPEAL BEFORE THE TRIBUNAL. 5. AT THE TIME OF HEARING BEFORE US, THE CONCERNED LD. CIT, D.R. HAS MOVED AN APPLICATION SEEKING ADJOURNMENT. IN THIS R EGARD, IT IS NOTED THAT THE LD D.R. HAS SOUGHT ADJOURNMENT IN 15 CASES OUT OF 22 CASES FIXED TODAY. IT IS ALSO OBSERVED THAT THE ISSUE INVOLVED IN THE PRESENT APPEAL RELATING TO THE DELETION BY THE LD. CIT(APPEALS) OF THE PENALTY IMPOSED BY THE ASSESSING OFFICER UNDER SECTION 271AAA IS SQUAR ELY COVERED BY THE DECISIONS OF THIS TRIBUNAL IN THE CASE OF M/S. SALA SAR STOCK BROKING LIMITED AND M/S. SHREE SALASAR PROPERTIES AND FINAN CE PVT. LIMITED I.T.A. NO. 1083/ KOL./2013 ASSESSMENT YEAR: 2009-2010 PAGE 7 OF 13 RENDERED VIDE ITS TWO SEPARATE ORDERS BOTH DATED 15 .04.2016 PASSED IN ITA NOS. 1082 AND 1081/KOL/2013. THE REQUEST OF THE LD. D.R. FOR ADJOURNMENT THEREFORE IS NOT ACCEDED TO AND THIS AP PEAL IS BEING DISPOSED OF AFTER HEARING THE ARGUMENTS OF THE LD. COUNSEL F OR THE ASSESSEE AND PERUSING THE RELEVANT MATERIAL AVAILABLE ON RECORD INCLUDING THE ORDERS OF THE TRIBUNAL PASSED IN THE CASE OF M/S. SALASAR ST OCK BROKING LIMITED AND M/S. SHREE SALASAR PROPERTIES & FINANCE PVT. LI MITED (SUPRA). IT IS OBSERVED THAT IN THE SAID CASES, PENALTIES IMPOSED BY THE ASSESSING OFFICER UNDER SECTION 271AAA IN RESPECT OF SIMILAR DISCLOSURE MADE BY THE ASSESSEES CONSEQUENT TO THE SEARCH CONDUCTED SIMULT ANEOUSLY WERE DELETED BY THE LD. CIT(APPEALS) AND THE TRIBUNAL VI DE ITS TWO SEPARATE ORDERS BOTH DATED 15.04.2016 (SUPRA) UPHELD THE ORD ERS OF THE LD. CIT(APPEALS) AFTER DISCUSSING ALL THE FACTS OF THE CASE, RELEVANT PROVISIONS OF THE LAW AND THE JUDICIAL PRONOUNCEMENTS IN DETAI LS IN PARAGRAPH NO. 8 TO 8.3 OF ITS ORDERS, WHICH READ AS UNDER:- 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERU SED THE MATERIALS AVAILABLE ON RECORD. THE LEARNED AR STATED THAT THE LEARNED AO HAD NOT INITIATED ANY PENALTY PROCEEDINGS U/S 271AAA OF THE ACT FOR THE A SST YEAR 2010-11, BEING THE YEAR OF SEARCH, FOR THE ADDITIONAL DISCLOSURE M ADE U/S 132(4) OF THE ACT IN THE SUM OF RS. 2 CRORES, IN VIEW OF THE FACT THAT T HE SAME WAS OFFERED IN THE RETURN FILED U/S 139(1) OF THE ACT. IN THIS REGARD , IT IS PERTINENT TO NOTE THAT THE ASSESSEE HAD TIME TO FILE ITS RETURN U/S 139(1) OF THE ACT AND HENCE ASSESSEE TRUE TO HIS DISCLOSURE PETITION THOUGHT IT FIT TO O FFER THE ADDITIONAL INCOME OF RS. 2 CRORES IN THE RETURN FILED U/S 139(1) OF THE ACT. BUT WHAT IS TO BE UNDERSTOOD HERE IS ORIGINALLY THE DISCLOSURE WAS MADE U/S 132( 4) OF THE ACT WHICH WAS FOLLOWED BY RETURN U/S 139(1) OF THE ACT. WE FIND THAT THE ASSESSEE HAD NOT DISCLOSED THE ADDITIONAL INCOME IN THE RETURN FILED U/S 139(1) OF THE ACT FOR THE ASST YEAR 2009-10 FOR THE REASON THAT THE ASSESSEE HAD FILED RETURN U/S 139(1) OF THE ACT PRIOR TO THE DATE OF DISCLOSURE U/S 132( 4) OF THE ACT. THE ASSESSEE HAD MADE DISCLOSURE PETITION U/S 132(4) OF THE ACT SUBSTANTIATING THE REASONS FOR OFFERING THE ADDITIONAL INCOME . FOR THE SAKE OF CONVENIENCE, THE DISCLOSURE PETITION U/S 132(4) OF THE ACT IS REPRODUCED HEREUN DER:- DISCLOSURE PETITION U/S 132(4) OF THE ACT IN THE CA SE OF M/S SALASAR STOCK BROKING LTD TO THE LD. A.D.I.T. (INV), UNIT - III (4) AAYAKAR BHAWAN ANNEXE P-L3, CHOWRINGHEE SQUARE, I.T.A. NO. 1083/ KOL./2013 ASSESSMENT YEAR: 2009-2010 PAGE 8 OF 13 KOLKATA - 700 069 RESPECTED SIR, RE : DISCLOSURE CONSEQUENT TO SEARCH AND SEIZURE OP ERATIONS CARRIED OUT BY THE INCOME TAX DEPARTMENT ON OUR PREMISES ON 11 TH SEPTEMBER' 2009/12 TH SEPTEMBER' 2009 WE ARE MEMBERS OF NATIONAL STOCK EXCHANGE - CAPITAL MARKET, F&O AND CURRENCY DERIVATIVES, MUMBAI STOCK EXCHANGE - CAPITAL MARKET , F&O AND CURRENCY DERIVATIVES, NSDL, MCX - CURRENCY DERIVATIVES, CALCUTTA STOCK EX CHANGE - CAPITAL MARKET. WE HAVE DONE TRANSACTIONS ON BEHALF OF VARIOUS CLIENTS AND ON OUR SELF ACCOUNT. DURING THE COURSE OF OUR TRANSACTIONS WITH VARIOUS PARTIES, WE HAVE RECEIVED MONEY FROM VARIOUS PARTIES INCLUDING ADVANCES, MARGIN MONEY AND DEPOSI TS. YOUR GOODSELF HAS RAISED A QUERY ON EXPLAINING THE SOURCES OF ALL SUCH ADVANC ES AND DEPOSITS AND IT APPEARS THAT YOU HAVE RAISED DOUBTS ON THE GENUINENESS OF CERTAI N TRANSACTIONS EARNED OUT BY US INCLUDING THE RECEIPT OF FUNDS INTO OUR COMPANY. WE HAVE BEEN CARRYING OUT REGULAR AND BONAFIDE TRANSACTIONS. HOWEVER, WE ARE NOT ABLE TO INSTANTLY PRODUCE ALL THE RELEVANT DOCUMENTATION OR PAPER WORK WHICH MAY BE R EQUIRED BY THE DEPARTMENT. HENCE TO DEMONSTRATE OUR CO-OPERATIVE ATTITUDE AND TO AVOID UNNECESSARY LONG DRAWN LITIGATIONS WITH THE DEPARTMENT AND TO BUY PEACE, WE ARE OFFERING AN ADDITIONAL INCOME OF RS. 2,00,00,000/- FOR FINANCIAL YEAR 200 8-09 AND RS. 2,00,00,000/- FOR FINANCIAL YEAR 2009-10 RESPECTIVELY. DURING THE COURSE OF SEARCH, CERTAIN DOCUMENTS PERT AINING TO THE COMPANY WERE INVENTORIZED AT OUR OFFICE PREMISES AT 4A, CLIVE RO W, SUIT NO. 411, 301A, 301B, 301C KOLKATA - 700 001 . BASED ON VARIOUS SEIZED DOCUMEN TS, WE HEREBY OFFER A SUM OF RS. 7,00,00,000/- AS OUR INCOME FOR THE FINANCIAL YEAR 2009-2010 UPTO THE PERIOD OF SEARCH. REFERENCE MAY BE MADE TO SEIZED DOCUMENT, SSB/6, PA GE I TO 25 AND 35-36. THE AFORESAID INCOME HAVE BEEN DEPLOYED IN THE WORKING CAPITAL OF THE COMPANY INCLUDING SECURITIES AND MARGIN MONEY WITH STOCK EXCHANGES. WE SHALL FILE RETURN ACCORDINGLY IN ACCORDANCE WITH LAW AFTER MAKING TECHNICAL ADJUSTMENTS (IF ANY). WE HAVE TRIED TO PROJECT A FU LL AND TRUE PICTURE ON AN ESTIMATED BASIS OF ALL THE INCOME AND WE ASSURE YOU THAT WE S HALL MAKE FULL AND TRUE DISCLOSURE IN THE RETURN ACCORDINGLY AND PAY TAXES THEREON. WE ALSO UNDERSTAND THAT WE SHALL NOT BE PENALIZED I N ANY MANNER FOR MAKING THE ABOVE STATEMENTS. THANKING YOU, FOR SALASAR STOCK BROKING LIMITED R.K. SARAOGI (DIRECTOR). I.T.A. NO. 1083/ KOL./2013 ASSESSMENT YEAR: 2009-2010 PAGE 9 OF 13 8.1. FROM THE ABOVE DISCLOSURE STATEMENT , WE FIND THAT THE ASSESSEE HAD SUBSTANTIATED THE FACT THAT THE INCOME IN THE FORM OF ADVANCES, M ARGIN MONEY AND DEPOSITS ETC WHICH MIGHT NOT BE PROVED TO THE SATISFACTION OF THE DEPA RTMENT WITH PROPER DOCUMENTATION AND PAPER WORK. WE ALSO FIND THAT EVEN THE LEARNE D AO HAD ACCEPTED THE SAID OFFER FOR THE SAID REASON IN HIS ASSESSMENT ORDER. WE FIND THAT THE ASSESSEE HAD NOT RETRACTED FROM THE DISCLOSURE PETITION. WE FIND THAT THE AS SESSEE HAD DULY OFFERED THE ADDITIONAL INCOME OF RS. 2,00,00,000/- IN THE CASE OF M/S SALA SAR STOCK BROKING LTD FOR THE ASST YEAR 2009-10 IN THE RETURN FILED U/S 153A OF THE ACT AND PAID TAXES THEREON. IN THE DISCLOSURE PETITION ITSELF, WE FIND THAT THE ASSESS EE HAD CLEARLY DEMONSTRATED THE INABILITY TO SUBSTANTIATE THE MANNER OF DERIVING TH E UNDISCLOSED INCOME IN THE CASE OF M/S SALASAR STOCK BROKING LTD. WE FIND THAT THE OFFER OF RS. 2 CRORES HAS BEEN MADE VOLUNTARILY BY THE ASSESSEE IN THE DISCLOSURE PETIT ION U/S 132(4) FOLLOWED BY FILING OF RETURN U/S 153A OF THE ACT. IT IS ALSO PERTINENT T O NOTE THAT THIS OFFER HAS BEEN VOLUNTARILY BY THE ASSESSEE WITHOUT ANY INCRIMINATI NG MATERIALS FOUND DURING THE COURSE OF SEARCH. HENCE IT GOES TO PROVE BEYOND DOUBT T HAT THE OFFER OF UNDISCLOSED INCOME OF RS. 2 CRORES WAS MADE VOLUNTARILY BY THE ASSESSEE W ITHOUT ANY DETECTION BY THE DEPARTMENT AND ACCORDINGLY THE ARGUMENT OF THE LEAR NED DR THAT BUT FOR THE SEARCH, THIS INCOME WOULD NOT HAVE BEEN OFFERED DOES NOT HO LD ANY WATER AND DESERVES TO BE DISMISSED. IT IS ALREADY WELL SETTLED THAT THOUG H THE INCOME IS NOT DISCLOSED IN THE RETURN FILED U/S 139(1) OF THE ACT, BUT DULY DISCLO SED IN THE PETITION FILED U/S 132(4) OF THE ACT FOLLOWED BY THE FILING OF RETURN IN RESPONSE TO SECTION 153A OF THE ACT AND TAXES PAID THEREON, THEN THE ASSESSEE WOULD NOT BE INVITED WI TH THE LEVY OF PENALTY. WE FIND THAT IF THE ARGUMENT OF THE LEARNED DR THAT SINCE THE AS SESSEE HAD NOT OFFERED THE SAID INCOME IN RETURN FILED U/S 139(1) OF THE ACT THEREB Y LEVY OF PENALTY IS IN ORDER IS TO BE ACCEPTED, THEN IT WOULD MAKE THE IMMUNITY PROVISION S CONTEMPLATED U/S 271AAA(2) OF THE ACT REDUNDANT. THE LEGISLATURE IN ITS WISDOM H AD GIVEN A THOUGHTFUL CONSIDERATION ON THE FACTS AND CIRCUMSTANCES UNDER WHICH THE ASSE SSEE WOULD NOT BE INVITED WITH THE LEVY OF PENALTY PURSUANT TO THE SEARCH SUBJECT TO F ULFILLMENT OF CERTAIN CONDITIONS STIPULATED IN THE SAID SECTION . HENCE IN VIEW OF THE ABOVE, WE HOLD THAT THE LEVY OF PENALTY IS NOT AUTOMATIC AND ASSESSEE IS CLEARLY EN TITLED FOR IMMUNITY FROM LEVY OF PENALTY. 8.2. WE ALSO FIND THAT THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF SUDARSHAN SILKS & SAREES VS CIT REPORTED IN (2008) 300 ITR 205 (SC) SUPPORTS THE CASE OF THE ASSESSEE. THE BRIEF FACTS OF THIS ARE AS BELOW :- 3. A SEARCH WAS CONDUCTED ON THE PREMISES OF THE ASSESSEE ON 14 AND 15-10-1987 AND INCRIMINATING DOCUMENTS EVIDENCING CONCEALMENT OF I NCOME BY THE ASSESSEE WERE UNEARTHED APART FROM CASH AND JEWELLERY FOUND AT TH E TIME OF SEARCH. IT WAS FOUND THAT THE APPELLANT WAS MAINTAINING DOUBLE SET OF BOOKS A ND WAS ACCOUNTING FOR ONLY 50 PER CENT OF SALES IN THE REGULAR SET OF BOOKS. THIS FAC T WAS ADMITTED BY SHRI 1.S. RAMESH, A PARTNER OF THE FIRM IN THE STATEMENT RECORDED UNDER SECTION 132(4) OF THE ACT. SHRI 1.S. RAMESH IS THE PERSON-IN- I.T.A. NO. 1083/ KOL./2013 ASSESSMENT YEAR: 2009-2010 PAGE 10 OF 13 CHARGE OF THE ENTIRE GROUP. THE TOTAL TURNOVER SUPP RESSED BY THE ASSESSEE FOR THE ASSESSMENT YEAR 1987-88 WAS FOUND TO BE TO THE TUNE OF RS. 44,07,783. THESE HAVE BEEN DISCUSSED IN DETAIL IN THE ORDER OF ASSESSMENT. ASS ESSING OFFICER ESTIMATED THAT THE SALES OF THE ASSESSEE WERE RS. 50,000 PER DAY, WHEREAS THE A CCOUNTED SALES WERE NOT FOUND EVEN 50 PER CENT OF THE TOTAL SALES. APART FROM THIS, IT WA S FOUND THAT CERTAIN PURCHASES WERE ALSO NOT BEING ACCOUNTED FOR. SIMILARLY CERTAIN PAYMENTS MAD E WERE NOT BEING ACCOUNTED FOR. ALL THESE WERE POINTED OUT TO THE ASSESSEE. THE ASSESSE E CAME FORWARD WITH OFFER OF ADDITIONAL INCOME. ASSESSEE FILED A REVISED RETURN ON 31-3-198 9 DECLARING A TOTAL INCOME FOR THIS YEAR AT RS. 3,74,226 AS AGAINST THE EARLIER AMOUNT OF RS . 43,650. THIS WAS ACCEPTED AND AFTER VERIFICATION THE ASSESSMENT WAS COMPLETED ON 29-12- 1989. 4. DURING THE COURSE OF RECORDING THE STATEMENT UN DER SECTION 132(4) OF THE ACT, SHRI RAMESH AGREED TO DECLARE SUCH ADDITIONAL INCOME AS HAD BEEN ESTIMATED BY THE SEARCH PARTY IN THE OFFICE OF THE APPELLANT AND ITS SISTER CONCERNS. ON THE BASIS OF THESE CALCULATIONS, REVISED RETURNS WERE FILED BY THE APPELLANT FOR ALL THE YEARS UNDER APPEAL. THE INCOME AS PER REVISED RETURNS WERE ALSO ACCEPTED IN TOTO. IN THE COURSE OF ASSESSMENT PROCEEDINGS, PENAL ACTION UNDER SECTION 271(1)(C) OF THE ACT WAS INITI ATED AND, AFTER CONSIDERING THE REPLY FILED BY THE APPELLANT, THE LEARNED ASSISTANT COMMISSIONE R OF INCOME-TAX/ASSESSING OFFICER CHOSE TO LEVY MAXIMUM PENALTY UNDER SECTION 271(1)(C). WH ILE LEVYING THE PENALTY, THE ASSESSING OFFICER REPELLED THE CONTENTION OF THE APPELLANT TH AT A PROMISE HAD BEEN MADE NOT TO LEVY THE PENALTY, AS THERE WAS NO EVIDENCE TO THIS EFFEC T ON RECORD. IT WAS ALSO HELD THAT THE APPELLANT WAS NOT ENTITLED TO THE IMMUNITY GIVEN UN DER SECTION 132(4) READ WITH SECTION 271(1)(C) OF THE ACT. THE LEARNED CIT(A) DELETED THE LEVY OF PENALTY U/S 271(1)(C ) OF THE ACT. ON SECOND APPEAL BY THE REVENUE, THE TRIBUNAL HELD AS FOLLOWS:- 'ALTHOUGH THERE IS NOTHING ON RECORD TO SHOW THAT H E WAS GIVEN AN ASSURANCE THAT NO PENALTY WOULD BE LEVIED, THE FACT HOWEVER CLEARLY S UGGEST THAT SUCH AN INDUCEMENT MUST HAVE BEEN GIVEN BY THE SEARCHING PARTY. WHEN ONLY P ARTIAL EVIDENCE IN SUPPORT OF CONCEALMENT FOR A VERY LIMITED PERIOD WAS DETECTED DURING THE SEARCH, WHY WOULD A MAN GO TO OFFER MUCH HIGHER AMOUNTS FOR A LARGE NUMBER OF YEARS UNLESS HE WAS PROMISED SOME RECIPROCAL BENEFIT LIKE NOT BEING VISITED WITH PENA LTY? THE LEARNED DR HAS TRIED TO ARGUE BEFORE US THAT A CHANGE OF HEART MIGHT HAVE TAKEN P LACE AS A RESULT OF WHICH SRI RAMESH CAME FORWARD WITH ALL THE DISCLOSURES FOR DIFFERENT YEARS VOLUNTARILY. BUT LOOKING INTO THE HARD FACTS OF LIFE AND THE GENERAL EXPERIENCE OF MA NKIND, ESPECIALLY WITH REGARD TO FINANCIAL AFFAIRS, IT WOULD BE DIFFICULT TO ACCEPT SUCH A PRO POSITION. EVIDENTLY, HUGE AMOUNT OF UNEXPLAINED INVESTMENTS INCLUDING UNEXPLAINED STOCK WAS FOUND AT THE TIME OF SEARCH. ULTIMATELY, ALMOST THE SAME AMOUNT OF INCOME WAS OF FERED BY THE ASSESSEES OVER A NUMBER OF YEARS. AS THE TAX RATES OVER THE ENTIRE PERIOD W AS MORE OR LESS THE SAME, THE TAX EFFECT, EITHER FROM THE POINT OF VIEW OF THE DEPARTMENT, OR THE ASSESSEE WOULD HAVE MORE OR LESS THE SAME, HAD THE ENTIRE UNDISCLOSED ASSETS BEEN SU BJECTED TO TAX IN THE YEAR OF SEARCH OR THE ENTIRE INCOME WAS SPREAD OVER A NUMBER OF YEARS AS HAS BEEN DONE IN THE PRESENT ASSESSMENTS. IN VIEW OF THE DEPOSITION GIVEN UNDER SECTION 132(4) FOLLOWED BY THE I.T.A. NO. 1083/ KOL./2013 ASSESSMENT YEAR: 2009-2010 PAGE 11 OF 13 COOPERATING ATTITUDE OF THE ASSESSEE IN PAYING UP T HE TAX, IT WOULD BE CLEAR THAT NO PENALTY UNDER SECTION 271(1) WOULD HAVE BEEN LEVIABLE HAD T HE ENTIRE UNDISCLOSED INCOME BEEN ASSESSED IN THE YEAR OF SEARCH. INSTEAD OF GOING FO R THAT SIMPLE WAY, SRI RAMESH WENT INTO THE QUESTION OF ADMITTING UNDISCLOSED INCOME ON EST IMATED BASIS FOR THE DIFFERENT PAST YEARS. HE MUST HAVE FELT THAT IN THAT PROCESS ALONE , HE WOULD AVOID THE LEVY OF PENALTY BY THE DEPARTMENTAL AUTHORITIES. THE FACTS AND CIRCUMS TANCES STRONGLY INDICATE THAT AN INDUCEMENT AND AN ALLUREMENT HAD BEEN PROVIDED TO H IM AT THE TIME OF SEARCH IN THAT MATTER. AGAIN, ALTHOUGH INCRIMINATING MATERIALS WERE FOUND OUT DURING THE SEARCH, SUCH MATERIALS WERE HOWEVER ULTIMATELY NOT USED BY THE DEPARTMENTA L AUTHORITIES IN MAKING THE ASSESSMENTS. THE ASSESSMENTS WERE MADE TOTALLY ON T HE BASIS OF ESTIMATION INCOME FOR THE EARLIER YEARS AS DISCLOSED IN THE REVISED RETURNS. THE REVISED RETURNS SHOULD THEREFORE BE CONSIDERED AS HAVING BEEN FILED IN GOOD FAITH. SO F AR AS ASSESSMENT OF THE UNDISCLOSED INCOME IS CONCERNED, SUCH REVISED RETURNS WOULD BE SUFFICIENT EVIDENCE FOR THAT PURPOSE. HOWEVER, FOR LEVYING PENALTY, SOME FURTHER AND STRO NGER EVIDENCES WERE SURELY REQUIRED. IN THE CASES RELIED UPON BY THE LEARNED DR, THE SEARCH ITSELF DISCOVERED THE UNDISCLOSED INCOME. IN THE INSTANT CASES, THE SEARCH MERELY LED TO CERTAIN CLUES TO THE UNDISCLOSED INCOME AND BUT FOR THE STATEMENT MADE BY SRI RAMESH , IT WOULD PERHAPS HAVE NOT BEEN POSSIBLE FOR THE DEPARTMENT TO ASSESS THE UNDISCLOS ED INCOME OVER ALL THESE YEARS IN THE WAY IN WHICH SUCH ASSESSMENTS HAVE BEEN MADE. THE O NLY WAY FOR THE DEPARTMENT IN SUCH A CASE WOULD HAVE BEEN TO ASSESS THE ENTIRE AMOUNT OF UNDISCLOSED INVESTMENTS FOR THE YEAR OF SEARCH AS HAS BEEN DISCUSSED BY US ABOVE, THE DE PTT. COULD NOT HAVE BEEN IN A POSITION TO LEVY PENALTY FOR CONCEALMENT IN SUCH A CASE. WE ARE THEREFORE OF THE OPINION THAT THE CASE LAWS AS CITED BY THE DEPARTMENT, DO NOT EXACTLY SUP PORT ITS CASE, SO FAR AS THE PRESENT APPEALS ARE CONCERNED. ON THE OTHER HAND, MOST OF T HE JUDGMENTS CITED BY THE LEARNED COUNSEL FOR THE ASSESSEE SUPPORT THE CASE OF THE AS SESSEE THAT ON ACCOUNT OF STRONG CIRCUMSTANTIAL EVIDENCES BEING THERE ABOUT INDUCEME NT HAVING BEEN GIVEN BY THE DEPARTMENTAL AUTHORITIES FOR NOT LEVYING PENALTY IN CASE OF DISCLOSURE OF INCOME OVER THE EARLIER YEARS, NO PENALTY CAN ACTUALLY BE LEVIED BY THE DEPARTMENT.' THESE FINDINGS HAVE BEEN FINALLY APPROVED BY THE HO NBLE SUPREME COURT BY OBSERVING AS UNDER:- 17. ACCORDINGLY, THE ORDERS UNDER APPEAL ARE SET AS IDE AND THAT OF THE CIT(APPEALS) AND TRIBUNAL RESTORED. IT IS HELD THAT IN THE FACTS AN D CIRCUMSTANCES OF THE CASE, PENALTY UNDER SECTION 271(1)(C ) WAS NOT EXIGIBLE. THE APPEALS A RE ACCEPTED WITH COSTS. 8.3. WE FIND THAT THE FOLLOWING DECISIONS SUPPORT THE CASE OF THE ASSESSEE :- A) DECISION OF CO-ORDINATE BENCH OF CUTTACK TRIBUNA L IN THE CASE OF PRAMOD KUMAR JAIN VS DCIT REPORTED IN (2013) 33 TAXMANN.COM 651 (CUTTACK TRIB.) I.T.A. NO. 1083/ KOL./2013 ASSESSMENT YEAR: 2009-2010 PAGE 12 OF 13 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERU SED THE MATERIAL AVAILABLE ON RECORD. ON CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE INCLINED TO HOLD THAT NO DEFINITION COULD BE GIVEN TO THE 'SPECIFIED MANNER' INSOFAR AS THE VERY STATEMENT ON OATH U/S. 132(4) SPECIFIES THE MANNER ON WHICH THE ASSES SEE IS PREPARED TO PAY TAX THEREON. THE INSCRIBING IN THE BOOKS OF ACCOUNT WAS TAKEN CARE O F BY THE ASSESSEE WHEN HE FILED THE RETURNS IN PURSUANCE TO NOTICE U/S. 153A ACCOUNTING THE ASSETS. THEREFORE, THE CASE LAWS CITED AT THE BAR CLEARLY INDICATE THAT THE PENALTY IS NOT AUTOMATIC IF ONE OF THE PURPORTED CONDITION IS NOT FULFILLED ALTHOUGH ALL THE CONDITI ONS HAVE BEEN AGREED TO OF HAVING FULFILLED BY THE ASSESSING OFFICER INSOFAR AS THE TAX AND INT EREST HAS BEEN RECOVERED. PENALTY HAS BEEN LEVIED AFTER THE TAX HAS BEEN RECOVERED THEREF ORE ANSWERS THE QUERIES RAISED BY THE LEARNED DR FOR THAT THE SAID PROVISIONS BECOME REDU NDANT WAS NOT THE INTENTION OF THE LEGISLATION. THE MANNER, DURING THE SEARCH OPERATIO N, IS NOTED BY THE SEARCH PARTY WHICH THE ASSESSING OFFICER HAS ACCEDED TO. THEREFORE, FOLLOW ING THE DECISIONS AS RELIED UPON BY THE LEARNED COUNSEL FOR THE ASSESSEE, WHEREIN THE TRIBU NAL WAS PLEASED TO CONSIDER CANCELLING THE PENALTY SO LEVIED ARE ALSO APPLICABLE TO THE AS SESSEES' CASES BEFORE US INSOFAR AS THERE IS NO PRESCRIBED METHOD TO INDICATE THE MANNER IN WHIC H INCOME WAS GENERATED WHEN THE DEFINITION OF 'UNDISCLOSED INCOME' HAS BEEN DEFINED IN THE ACT ITSELF WHEN NO INCOME OF THE SPECIFIED PREVIOUS YEAR REPRESENTED 'EITHER WHOLLY OR PARTLY' WHICH ONUS LAY UPON THE ASSESSEE STOOD DISCHARGED. IN VIEW OF THE ABOVE, WE ARE OF THE CONSIDERED VIEW THAT THE LEVY OF PENALTY U/S. 27LAAA IN THE INSTANT CASES ARE NOT JUSTIFIED AND AS SUCH, WE CANCEL THE PENALTY SO LEVIED U/S. 271 AAA FOR THE AYS UNDER CO NSIDERATION IN THE CASE OF RESPECTIVE ASESSEES. IN THE RESULT, ALL THE APPEALS FILED BY THE A SSESSES ARE ALLOWED. B) DECISION OF CO-ORDINATE BENCH OF NAGPUR TRIBUNA L IN THE CASE OF CONCRETE DEVELOPERS VS ACIT REPORTED IN (2013) 34 TAXMANN.COM 62 (NAGPUR-T RIB.) SECTION 271AAA OF THE INCOME-TAX ACT, 1961 - PENAL TY - WHERE SEARCH HAS BEEN INITIATED - ASSESSMENT YEAR 2009-10 - WHETHER WHERE DURING COUR SE OF SEARCH ASSESSEE ADMITTED UNDISCLOSED INCOME, PAID TAX TOGETHER WITH INTEREST , FILED RETURN SHOWING SAID INCOME AS BUSINESS INCOME AND ASSESSING OFFICER HAD ACCEPTED SAME, IT COULD NOT BE SAID THAT ASSESSEE HAD NOT SPECIFIED MANNER OR COULD NOT SUBSTANTIATE MANNER IN WHICH INCOME WAS DERIVED - HELD, YES - WHETHER, THEREFORE, PENALTY UNDER SECTI ON 271AAA WAS NOT LEVIABLE AS ASSESSEE'S CASE FELL UNDER SUB- SECTION (2) OF SECTION 271AAA - HELD, YES [PARA 9] [IN FAVOUR OF ASSESSEE] 6. A PERUSAL OF THE RELEVANT PORTION OF THE TRIBUNA LS ORDER PASSED IN THE CASES OF M/S. SALASAR STOCK BROKING LIMITED AND M/S. SHREE SALASAR PROPERTIES & FINANCE PVT. LIMITED (SUPRA) CLEARLY S HOWS THAT SIMILAR PENALTIES IMPOSED BY THE ASSESSING OFFICER UNDER SE CTION 271AAA IN THE IDENTICAL FACTS AND CIRCUMSTANCES HAVE BEEN HELD TO BE NOT SUSTAINABLE BY I.T.A. NO. 1083/ KOL./2013 ASSESSMENT YEAR: 2009-2010 PAGE 13 OF 13 THE TRIBUNAL AND THE DECISION RENDERED THEREIN BY T HE COORDINATE BENCH OF THIS TRIBUNAL IS SQUARELY APPLICABLE IN THE PRES ENT CASE. WE, THEREFORE, RESPECTFULLY FOLLOW THE SAME AND UPHOLD THE IMPUGNE D ORDER OF THE LD. CIT(APPEALS) CANCELLING THE PENALTY IMPOSED BY THE ASSESSING OFFICER UNDER SECTION 271AAA OF THE ACT. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON APRIL 29, 201 6. SD/- SD/- (S.S. VISWANETHRA RAVI) (P.M. JAGTAP) JUDICIAL MEMBER ACCOUNTANT MEMBER KOLKATA, THE 29 TH DAY OF APRIL, 2016 COPIES TO : (1) DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-V, KOLKATA, AAYAKAR BHAWAN POORVA, 3 RD FLOOR, 110, SHANTIPALLY, KOLKATA-700 107 (2) KRISHNA TRADE & COMMERCE PVT. LIMITED, MUKTI CHAMBER, 4A, CLIVE ROW, KOLKATA-700 001 (3) COMMISSIONER OF INCOME-TAX (APPEALS), CENTRAL- I, KOLKATA (4) COMMISSIONER OF INCOME TAX, KOLKATA (5) THE DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.