SHRI AESHWARYA JAIN, KOTA V. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, KOTA

ITA 1129/JPR/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 7776 (ITAT-JAIPUR)
• Duration Of Justice: 3 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 17-09-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CHANCHAL MEENA J DHK
• Assessee Lawyers: S L PODDAR
• Keywords: Unexplained expenditure; Business income; Income from undisclosed sources; Search and seizure; Salary income; Loose papers; Document seized; Opportunity of being heard; Principle of natural justice; Transactions in derivatives; Source of fund; Retrospective amendment; Question of law; Reasonable cause; Non compliance; Documents seized; Set aside; CHAPTER IV
• Section: 271(1)(c); 44AD; 143(3); 153A; 292BB; 274; 44BB; 139(1); 13; 32; 69; 27; 132; 12; 139

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCH A , JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE : SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA-@ ITA NO. 1129/JP/2019 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2014-15 SHRI AESHWARYA JAIN 65, SHOPPING CENTRE KOTA CUKE VS. THE DCIT CENTRAL CIRCLE KOTA LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: ABJPJ 3114 A VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI S.L. PODDAR, ADVOCATE JKTLO DH VKSJ LS@ REVENUE BY : MS.CHANCHAL MEENA, JCIT-DR LQUOKBZ DH RKJH[K@ DATE OF HEARING : 03/01/2020 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 07/01/2020 VKNS'K@ ORDER PER VIJAY PAL RAO, JM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER DATED 28-06-2019 OF LD. CIT(A)-2, UDAIPUR ARISING FROM PENALTY ORDER PASSED U/S 271AAB OF THE ACT FOR THE ASSESSMENT YEAR 2014- 15. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS. 1. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN PASSING THE ORDER U/S 271AAB OF THE I.T. ACT, 1961 WHICH IS VOID AB INITO DESERVES TO BE QUASHED. ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 2 2. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE TH E LD. CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF THE AO IN PASSING THE ORDER DATED 13-08-2018 PASSED U/S 271AAB OF THE I.T . ACT, 1961 WITHOUT RECORDING THE SATISFACTION THAT UNDER WHICH LIMB THE ASSESSEE HAS COMMITTED OFFENCE FOR WHICH PENALTY IS LEVIABLE. 3. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE TH E LD. CIT(A) HAS ERRED IN CONFIRMING THE PENALTY OF RS. 3 ,00,000/- IMPOSED BY THE AO U/S 271AAB OF THE I.T. ACT, 1961. 2.1 THE GROUND NOS. 1 TO 3 OF THE ASSESSEE ARE REGA RDING DELETION OF PENALTY OF RS. 3.00 LACS U/S 271AAB OF THE ACT CONF IRMED BY THE LD. CIT(A) 2.2 THE ASSESSEE IS AN INDIVIDUAL AND DERIVES INCOM E FROM HOUSE PROPERTY, INCOME FROM BUSINESS AND PROFESSION AND I NTEREST FROM PARTNERSHIP FIRM. A SEARCH AND SEIZURE ACTION U/S 1 32 OF THE ACT WAS CARRIED OUT IN THE CASE OF M/S. MUNDRA & JAIN MARBL E, 16, JHALAWAR ROAD, KOTA ON 13-08-2013. DURING THE COURSE OF SEARCH AND SEIZURE ACTION, CERTAIN LOOSE PAPERS WERE FOUND AND SEIZED MARKED A S ANNEXURE A-2, PAGE NO. 60 TO 62 IN RESPECT OF FURNITURE AND FIXTU RE IN RESIDENTIAL HOUSE SITUATED AT 56, RAJEEV GANDHI NAGAR, KOTA IN THE N AME OF ASSESSEE'S WIFE SMT. USHA JAIN. DURING THE COURSE OF STATEMENT RECO RDED U/S 132(4) OF THE ACT, THE ASSESSEE SURRENDERED AN INCOME OF RS. 10.0 0 LACS ON THIS ACCOUNT. ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 3 THE ASSESSEE FILED THE RETURN OF INCOME FOR THE YEA R UNDER CONSIDERATION DECLARING TOTAL INCOME AT RS. 13,68,700/- INCLUDING THE SURRENDERED INCOME OF RS. 10.00 LACS. THE ASSESSMENT WAS COMPLE TED U/S 143(3) OF THE ACT R.W.S. 153B(1)(B) OF THE OF THE ACT AT THE RETURNED INCOME. HOWEVER, THE AO HELD THAT INCOME OF RS. 10.00 LACS IS ASSESSABLE U/S 69 OF THE ACT AND THEREFORE, THE SAME IS TAXABLE @ 30% AS PER THE PROVISIONS OF SECTION 115BBE OF THE ACT. THE AO ALSO INITIATED THE PENALTY PROCEEDINGS U/S 271AAB OF THE ACT AND LEVIED THE PE NALTY OF RS. 3.00 LACS BEING 30% OF UNDISCLOSED INCOME OF RS. 10.00 L ACS DUE TO THE REASON THAT RETURN OF INCOME FILED BY THE ASSESSEE WAS BEL ATED BEYOND THE TIME PRESCRIBED PROVIDED U/S 139(1) OF THE ACT. THE ASSE SSEE CHALLENGED THE ACTION OF THE AO BEFORE THE LD. CIT(A) AND CONTENDE D THAT INCOME SURRENDERED BY THE ASSESSEE OF RS. 10.00 LACS DOES NOT FALL UNDER THE DEFINITION OF UNDISCLOSED INCOME AS PROVIDED U/S 27 1AAB OF THE ACT. THE LD. CIT(A) DID NOT ACCEPT THE CONTENTION OF THE ASS ESSEE AND CONFIRMED THE PENALTY LEVIED BY THE AO U/S 271AAB OF THE ACT WHILE PASSING THE IMPUGNED ORDER. 2.3 BEFORE US, THE LD.AR OF THE ASSESSEE REFERRED T O THE SEIZED MATERIAL AND SUBMITTED THAT IT IS NOTHING BUT ONLY A SITE PL AN/ DESIGN OF ELECTRIC ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 4 WORK AND APPLIANCES OF RESIDENTIAL HOUSE NO. 56, R AJEEV GANDHI NAGAR, KOTA. THE SAID DOCUMENTS FOUND DURING SEARCH AND SE IZURE ACTION DOES NOT REVEAL ANY UNDISCLOSED INCOME OR ANY UNEXPLAINE D EXPENDITURE. HE HAS REFERRED TO THE STATEMENT OF THE ASSESSEE AND S UBMITTED THAT IN QUESTION NO. 22, THE SEARCHED PARTY HAD CONFRONTED THE SEIZED DOCUMENTS TO THE ASSESSEE AND IN RESPONSE THE ASSESSEE HAD S TATED THAT IT IS AN ELECTRIC PLAN AND MAP OF THE HOUSE, HOWEVER, THE AS SESSEE SURRENDERED A SUM OF RS. 10.00 LACS. THUS THE LD.AR OF THE ASSESS EE SUBMITTED THAT WHEN THE SURRENDER IS NOT BASED ON ANY INCRIMINATIN G MATERIAL REVEALING ANY UNDISCLOSED INCOME THEN THE PENALTY LEVIED U/S 271AAB OF THE ACT IS NOT JUSTIFIED AS THE SAID SURRENDER DOES NOT FALL IN THE DEFINITION OF UNDISCLOSED INCOME AS PROVIDED IN THE EXPLANATION T O SECTION 271AAB OF THE ACT. THE LD.AR OF THE ASSESSEE SUBMITTED THAT T HE PENALTY U/S 271AAB OF THE ACT IS LEVIBALE WITH REFERENCE TO UNDISCLOSE D INCOME. THE UNDISCLOSED INCOME HAS BEEN DEFINED SPECIFICALLY UN DER EXPLANATION TO THE PROVISIONS OF SECTION 271AAB (3) OF THE ACT. TH E LD.AR OF THE ALSO REFERRED TO CBDT CIRCULARS BEARING F.NO.286/2/2003 -IT(INV) DATED 10- 03-2003 AND F.NO.286/98/2013/IT(INV.II) DATED 18-12 -2014. THE LD.AR OF THE ASSESSEE FURTHER SUBMITTED THAT IN THIS CASE THERE WAS NO ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 5 UNDISCLOSED INCOME IN THE CASE OF THE ASSESSEE. THE ASSESSEE WAS FORCED TO ADMIT AND SURRENDER INCOME DURING THE COURSE OF ASSESSMENT PROCEEDING / IN THE STATEMENT RECORDED U/S 132(4) O F THE ACT. SUCH FORCEFUL ADMISSION DOES NOT COMPLY WITH THE SPIRIT OF THE LAW. THE PROVISIONS OF SECTION 271AAB(1)(A)(II) CLEARLY REQU IRES THAT SUCH UNDISCLOSED INCOME ADMITTED U/S 132(4) REQUIRES TO BE SUBSTANTIATED. IT MEANS THAT THE ASSESSEE IS REQUIRED TO SPECIFY THE MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED AND FURTHER SUBSTANTIATE TH E SAME BY FURNISHING MATERIAL AVAILABLE WITH HIM. IN THIS CASE NO SUCH S UBSTANTIATION WAS DONE AS IN FACT THERE EXISTED NO UNDISCLOSED INCOME. THE ENTIRE DISCLOSURE WAS ON PAPER AND ASSESSEE ADMITTED SUCH DISCLOSURE TO A VOID UNDUE HARASSMENT AND UNWANTED LITIGATION. IN THE CIRCUMST ANCES, NO PENALTY IS CALLED FOR U/S 271AAB OF THE I.T. ACT, 1961. IN SUP PORT OF HIS CONTENTION, THE LD.AR OF THE ASSESSEE RELIED ON THE DECISION OF ITAT COORDINATE BENCH IN THE CASE OF RAVI MATHUR VS DCIT IN ITA NO. 969/JP/2017 DATED 13-06-2018. THUS THE LD.AR OF THE ASSESSEE PLEADED THAT THE PENALTY LEVIED U/S 271AAB OF THE ACT IS NOT SUSTAINABLE IN LAW AND THE SAME IS LIABLE TO BE DELETED. ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 6 2.4 ON THE OTHER HAND, THE LD. DR SUBMITTED THAT TH E ASSESSEE HAS DISCLOSED THE UNDISCLOSED INCOME DURING THE COURSE OF SEARCH AND SEIZURE ACTION BASED ON SEIZED MATERIAL. THE ASSESSEE HAS N EVER ALLEGED THAT DISCLOSURE IS DUE TO ANY COERCIVE ACTION OR UNDUE P RESSURE ON THE DEPARTMENT. IT WAS VOLUNTARY STATEMENT OF THE ASSES SEE EXPLAINING THE UNDISCLOSED INCOME ON ACCOUNT OF UNACCOUNTED EXPEND ITURE INCURRED ON FURNITURE AND FIXTURE AND NOT ENTERED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. THE LD. DR RELIED ON THE ORDERS OF THE AU THORITIES BELOW AS WELL AS THE DECISION OF HON'BLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS SANDEEP CHANDAK, 405 ITR 648 (ALL.) 2.5 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WEL L AS RELEVANT MATERIALS AVAILABLE ON RECORD. IN THE CASE IN HAND DURING SEARCH AND SEIZURE ACTION U/S 132 OF THE ACT, THE ASSESSEE IN HIS STATEMENT RECORDED U/S 132(4) OF THE ACT HAD DISCLOSED AND SURRENDERED INCOME OF RS. 10.00 LACS ON ACCOUNT OF EXPENDITURE OF FURNITURE AND FIX TURE IN THE RESIDENTIAL HOUSE SITUATED AT 56, RAJEEV GANDHI NAGAR, KOTA IN THE NAME OF ASSESSEE'S WIFE SMT. USHA JAIN. IT IS SETTLED PROPOSITION OF L AW THAT PENALTY U/S 271AAB OF THE ACT IS NOT MANDATORY IN NATURE BUT T HE AO HAS TO TAKE THE DECISION AFTER CONSIDERING ALL THE FACTS OF THE CAS E AS WELL AS TO ENSURE ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 7 THAT CONDITIONS AS SPECIFIED U/S 271AAB OF THE ACT ARE SATISFIED. THUS THE PENALTY U/S 271AAB OF THE ACT IS NOT IPSO FACTO AS A RESULT OF SURRENDER OR DISCLOSURE OF INCOME BY THE ASSESSEE DURING THE COU RSE OF SEARCH AND SEIZURE ACTION UNTIL AND UNLESS SUCH SURRENDER OF I NCOME BY THE ASSESSEE FALLS IN THE DEFINITION OF UNDISCLOSED INCOME AS PR OVIDED IN EXPLANATION TO SECTION 271AAB OF THE ACT. THIS ISSUE WHETHER PENAL TY IS MANDATORY OR DISCRETIONARY HAS BEEN CONSIDERED BY THE COORDINAT E BENCH OF THE JAIPUR TRIBUNAL IN THE CASE OF RAVI MATHUR VS DCIT (SUPRA ) WHEREIN THE TRIBUNAL HAS ANALYZED THIS PROVISION AS WELL AS CON SIDERED THE DECISION OF HON'BLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS SANDEEP CHANDAK AND OTHERS (SUPRA) IN PARA 4 TO 9 AS UNDER:- 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WE LL AS THE RELEVANT MATERIAL ON RECORD. THE INCOME SURRENDERED BY THE ASSESSEE DURING THE COURSE OF SEARCH AND SEIZURE AND IN THE STATEMENT R ECORDED UNDER SECTION 132(4) OF THE ACT IS ON ACCOUNT OF ADVANCES GIVEN F OR PURCHASES OF LAND. THE ASSESSEE HAS DECLARED THE INCOME AS SALARY RECEIVED FROM PARTNERSHIP FIRM, INTEREST FROM PARTNERSHIP FIRM, CAPITAL GAIN SHORT TERM AND LONG TERM BOTH AND INCOME FROM OTHER SOURCES, APART FROM THE SURRENDER ED INCOME OF RS. 7,22,00,000/-. THEREFORE, IT IS CLEAR THAT THE ASS ESSEE WAS NOT REQUIRED TO MAIN THE REGULAR BOOKS OF ACCOUNT AS PER SECTION 44 AA OF THE ACT. THE AO AND LD. CIT (A) HAVE PROCEEDED ON THE PREMISES THAT THE PENALTY UNDER SECTION 271AAB IS MANDATORY IN NATURE AND, THEREFOR E, THE OBJECTIONS RAISED BY THE ASSESSEE BEFORE THE AO AS WELL AS BEFORE THE LD. CIT (A) WERE NOT ADJUDICATED WHILE PASSING THE IMPUGNED ORDER. ONCE THE AO HAS TO TAKE A DECISION AFTER GIVING AN OPPORTUNITY OF HEARING TO THE ASSESSEE FOR LEVY OF PENALTY UNDER SECTION 271AAB OF THE ACT, THEN THE E XPLANATION AND CONTENTIONS RAISED BY THE ASSESSEE AGAINST THE PROP OSED LEVY OF PENALTY ARE ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 8 REQUIRED TO BE CONSIDERED AND DISPOSED OFF IN OBJEC TIVE MANNER. THERE IS NO DISPUTE THAT THE CBDT EXTENDED THE DUE DATE OF FILI NG THE RETURN UNDER SECTION 139(1) UPTO 31 ST DECEMBER, 2014 AND, THEREFORE, THE RETURN OF INCOM E FILED BY THE ASSESSEE ON 31 ST JANUARY, 2015 OUGHT TO HAVE BEEN CONSIDERED IN THE LIGHT OF THE EXPLANATION AND CIRCUMSTANCES IN W HICH THE DELAY IN FILING THE RETURN HAD OCCURRED. THE AO AS WELL AS THE LD. CIT (A) HAVE FAILED TO DISCHARGE THE STATUTORY DUTY TO SHOW CAUSE THE ASSE SSEE FOR APPLYING THE PROVISIONS OF SECTION 271AAB(B)(1)(C) OF THE ACT AN D THEN TO CONSIDER THE EXPLANATION OF THE ASSESSEE WHETHER BONAFIDE AND BE YOND THE CONTROL OF THE ASSESSEE FOR NOT FULFILLING THE SAID CONDITION. EVE N THERE IS NO FINDING BY THE AUTHORITIES BELOW WHETHER THE AMOUNT IN QUESTION FA LLS IN THE AMBIT OF UNDISCLOSED INCOME AS DEFINED UNDER CLAUSE (C) OF T HE EXPLANATION TO SECTION 271AAB OF THE ACT. ACCORDINGLY, IN THE FACTS AND C IRCUMSTANCES OF THE CASE, WE NOTE THAT AN IDENTICAL ISSUE HAS BEEN CONSIDERED BY THIS TRIBUNAL IN THE CASE OF RAVI MATHUR VS. DCIT IN ITA NO. 969/JP/2017 DATED 13.06.2018 IN PARA 4 TO 9 AS UNDER :- 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WEL L AS RELEVANT MATERIAL ON RECORD. A SEARCH WAS CONDUCTED UNDER S ECTION 132 OF THE IT ACT ON 30 TH OCTOBER, 2014 AT THE PREMISES OF THE ASSESSEE. TH E ASSESSEE IN HIS STATEMENT RECORDED UNDER SECTION 13 2(4) HAS DISCLOSED AN INCOME OF RS. 10,02,00,000/- IN PURSUANT TO THE ENTRIES OF ADVANCES GIVEN FOR PURCHASE OF LAND RECORDED IN THE POCKET D IARY WHICH WAS FOUND AND SEIZED DURING THE COURSE OF SEARCH AND SE IZURE ACTION. THIS IS YEAR OF SEARCH AND THE FINANCIAL YEAR WOULD END ON 31 ST MARCH, 2015. HOWEVER, THE ASSESSEE DISCLOSED THIS AMOUNT OF RS. 10,02,00,000/- BASED ON THE ENTRIES IN THE DIARY REGARDING INVESTM ENT IN REAL ESTATE. THE DUE DATE OF FILING OF RETURN OF INCOME UNDER SE CTION 139(1) WAS 30 TH SEPTEMBER, 2015. IT IS UNDISPUTED FACT THAT THE A SSESSEE IS AN INDIVIDUAL AND WAS NOT MAINTAINING REGULAR BOOKS OF ACCOUNT. THEREFORE, THE TRANSACTIONS RECORDED IN THE POCKET DIARY FOUND DURING THE COURSE OF SEARCH ITSELF WOULD NOT LEAD TO THE P RESUMPTION THAT THE ASSESSEE WOULD NOT HAVE OFFERED THIS INCOME TO TAX IF THE SEARCH IS NOT CONDUCTED ON 30 TH OCTOBER, 2014. FURTHER, THE ENTRIES IN THE DIARY ITSELF DO NO NOT REPRESENT THE INCOME OF THE ASSESS EE DURING THE YEAR UNDER CONSIDERATION THOUGH THE ASSESSEE WAS REQUIRE D TO EXPLAIN THE SOURCE OF INVESTMENT IN QUESTION AND THAT SOURCE WO ULD BE THE INCOME OF THE ASSESSEE. IT IS MOST LIKELY THAT THE INVEST MENT IN QUESTION WAS MADE FROM THE UNACCOUNTED INCOME OF PRECEDING YEARS . HENCE THE INVESTMENT IN THE REAL ESTATE ITSELF WOULD NOT REVE AL THE NATURE OF INCOME AND THE SOURCE OF INCOME OF THE YEAR UNDER C ONSIDERATION. IT IS ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 9 A PRE-CONDITION FOR INVOKING THE PROVISIONS OF SECT ION 271AAB THAT THE ASSESSEE ADMITTED THE UNDISCLOSED INCOME IN THE STA TEMENT UNDER SECTION 132(4). THE DEFINITION OF UNDISCLOSED IN COME IS PROVIDED IN SECTION 271AAB ITSELF AND, THEREFORE, THE AO IN THE PROCEEDINGS UNDER SECTION 271AAB HAS TO EXAMINE ALL THE FACTS OF THE CASE AND THEN ARRIVE TO THE CONCLUSION THAT THE INCOME DISCLOSED BY THE ASSESSEE FALLS IN THE DEFINITION OF UNDISCLOSED INCOME AS STIPULATED IN THE EXPLANATION TO SAID SECTION. THE FIRST QUESTION ARISES IS WHETHER THE LEVY OF PENALTY UNDER SECTION 271AAB IS MANDATORY AND CONSEQUENTIAL TO THE DISCLOSURE OF INCOME BY THE ASSESSEE UNDER SECTION 132(4) OR T HE AO HAS TO TAKE A DECISION WHETHER THE GIVEN CASE HAS SATISFIED TH E REQUIREMENTS FOR LEVY OF PENALTY UNDER SECTION 271AAB OF THE ACT. IN ORDER TO CONSIDER THIS ISSUE, THE PROVISIONS OF SECTION 271AAB ARE TO BE ANALYZED. FOR READY REFERENCE, WE QUOTE SECTION 271AAB AS UNDER : - 271AAB. (1) THE ASSESSING OFFICER MAY, NOTWITHSTANDING ANY THING CONTAINED IN ANY OTHER PROVISIONS OF THIS ACT, DIRECT THAT, IN A CASE WHERE SEARCH HAS BEEN INITIATED UNDER SECTION 132 ON OR AFTER THE 1ST DAY OF JULY, 2012 49 [BUT BEFORE THE DATE ON WHICH THE TAXATION LAWS (SECOND AMENDMENT) BILL, 2016 RECEIVES THE ASSENT OF THE PRESIDENT 50 ], THE ASSESSEE SHALL PAY BY WAY OF PENALTY, IN ADD ITION TO TAX, IF ANY, PAYABLE BY HIM, (A) A SUM COMPUTED AT THE RATE OF TEN PER CENT OF THE U NDISCLOSED INCOME OF THE SPECIFIED PREVIOUS YEAR, IF SUCH ASSESSEE (I) IN THE COURSE OF THE SEARCH, IN A STATEMENT UNDER S UB- SECTION (4) OF SECTION 132 , ADMITS THE UNDISCLOSED INCOME AND SPECIFIES THE MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED; (II) SUBSTANTIATES THE MANNER IN WHICH THE UNDISCLOSED I NCOME WAS DERIVED; AND (III) ON OR BEFORE THE SPECIFIED DATE (A) PAYS THE TAX, TOGETHER WITH INTEREST, IF ANY, IN RE SPECT OF THE UNDISCLOSED INCOME; AND (B) FURNISHES THE RETURN OF INCOME FOR THE SPECIFIED PR EVIOUS YEAR DECLARING SUCH UNDISCLOSED INCOME THEREIN; (B) A SUM COMPUTED AT THE RATE OF TWENTY PER CENT OF TH E UNDISCLOSED INCOME OF THE SPECIFIED PREVIOUS YEAR, IF SUCH ASSESSEE (I) IN THE COURSE OF THE SEARCH, IN A STATEMENT UNDER S UB- SECTION (4) OF SECTION 132 , DOES NOT ADMIT THE UNDISCLOSED INCOME; AND (II) ON OR BEFORE THE SPECIFIED DATE (A) DECLARES SUCH INCOME IN THE RETURN OF INCOME FURNIS HED FOR ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 10 THE SPECIFIED PREVIOUS YEAR; AND (B) PAYS THE TAX, TOGETHER WITH INTEREST, IF ANY, IN RE SPECT OF THE UNDISCLOSED INCOME; (C) A SUM 51 [COMPUTED AT THE RATE OF SIXTY PER CENT] OF THE UND ISCLOSED INCOME OF THE SPECIFIED PREVIOUS YEAR, IF IT IS NOT COVERED B Y THE PROVISIONS OF CLAUSES (A ) AND (B). 52 [(1A) THE ASSESSING OFFICER MAY, NOTWITHSTANDING AN YTHING CONTAINED IN ANY OTHER PROVISIONS OF THIS ACT, DIRECT THAT, IN A CASE WHER E SEARCH HAS BEEN INITIATED UNDER SECTION 132 ON OR AFTER THE DATE ON WHICH THE TAXATION LAWS (S ECOND AMENDMENT) BILL, 2016 RECEIVES THE ASSENT OF THE PR ESIDENT, THE ASSESSEE SHALL PAY BY WAY OF PENALTY, IN ADDITION TO TAX, IF ANY, PAYABLE BY HIM, (A) A SUM COMPUTED AT THE RATE OF THIRTY PER CENT OF THE UNDISCLOSED INCOME OF THE SPECIFIED PREVIOUS YEAR, IF THE ASSESSEE (I) IN THE COURSE OF THE SEARCH, IN A STATEMENT UNDER S UB- SECTION (4) OF SECTION 132 , ADMITS THE UNDISCLOSED INCOME AND SPECIFIES THE MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED; (II) SUBSTANTIATES THE MANNER IN WHICH THE UNDISCLOSED I NCOME WAS DERIVED; AND (III) ON OR BEFORE THE SPECIFIED DATE (A) PAYS THE TAX, TOGETHER WITH INTEREST, IF ANY, IN RESPECT OF THE UNDISCLOSED INCOME; AND (B) FURNISHES THE RETURN OF INCOME FOR THE SPECIFIED PR EVIOUS YEAR DECLARING SUCH UNDISCLOSED INCOME THEREIN; (B) A SUM COMPUTED AT THE RATE OF SIXTY PER CENT OF THE UNDISCLOSED INCOME OF THE SPECIFIED PREVIOUS YEAR, IF IT IS NOT COVERED UNDER THE PROVISIONS OF CLAUSE (A).] (2) NO PENALTY UNDER THE PROVISIONS OF 53 [ SECTION 270A OR] CLAUSE (C) OF SUB-SECTION (1) OF SECTION 271 SHALL BE IMPOSED UPON THE ASSESSEE IN RESPECT OF T HE UNDISCLOSED INCOME REFERRED TO IN SUB-SECTION (1) 52 [OR SUB-SECTION (1A)]. (3) THE PROVISIONS OF SECTIONS 274 AND 275 SHALL, AS FAR AS MAY BE, APPLY IN RELATION TO THE PENALTY REFERRED TO IN THIS SECTION. EXPLANATION.FOR THE PURPOSES OF THIS SECTION, (A) 'SPECIFIED DATE' MEANS THE DUE DATE OF FURNISHING O F RETURN OF INCOME UNDER SUB-SECTION (1) OF SECTION 139 OR THE DATE ON WHICH THE PERIOD SPECIFIED IN THE NOTICE ISSUED UNDER SECTION 153A FOR FURNISHING OF RETURN OF INCOME EXPIRES, AS THE CASE MAY BE; (B) 'SPECIFIED PREVIOUS YEAR' MEANS THE PREVIOUS YEAR (I) WHICH HAS ENDED BEFORE THE DATE OF SEARCH, BUT THE DATE OF FURNISHING ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 11 THE RETURN OF INCOME UNDER SUB-SECTION (1) OF SECTION 139 FOR SUCH Y EAR HAS NOT EXPIRED BEFORE THE DATE OF SEARCH AND T HE ASSESSEE HAS NOT FURNISHED THE RETURN OF INCOME FOR THE PREVIOUS YEAR BEFORE THE DATE OF SEARCH; OR (II) IN WHICH SEARCH WAS CONDUCTED; (C) 'UNDISCLOSED INCOME' MEANS (I) ANY INCOME OF THE SPECIFIED PREVIOUS YEAR REPRESENTED, EITHER WHOLLY OR PARTLY, BY ANY MONEY, BULLION, JEWELLERY OR OTHE R VALUABLE ARTICLE OR THING OR ANY ENTRY IN THE BOOKS OF ACCOUNT OR OT HER DOCUMENTS OR TRANSACTIONS FOUND IN THE COURSE OF A SEARCH UNDER SECTION 132 , WHICH HAS (A) NOT BEEN RECORDED ON OR BEFORE THE DATE OF SEARCH I N THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS MAINTAINED IN T HE NORMAL COURSE RELATING TO SUCH PREVIOUS YEAR; OR (B) OTHERWISE NOT BEEN DISCLOSED TO THE 54 [PRINCIPAL CHIEF COMMISSIONER OR] CHIEF COMMISSIONER OR 54 [PRINCIPAL COMMISSIONER OR] COMMISSIONER BEFORE THE DATE OF SE ARCH; OR (II) ANY INCOME OF THE SPECIFIED PREVIOUS YEAR REPRESENT ED, EITHER WHOLLY OR PARTLY, BY ANY ENTRY IN RESPECT OF AN EXPENSE RE CORDED IN THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS MAINTAINED IN THE NOR MAL COURSE RELATING TO THE SPECIFIED PREVIOUS YEAR W HICH IS FOUND TO BE FALSE AND WOULD NOT HAVE BEEN FOUND TO BE SO HAD THE SEARCH N OT BEEN CONDUCTED.] THE SECTION BEGINS WITH THE STIPULATION THAT THE AO MAY DIRECT THE ASSESSEE SHALL PAY BY WAY OF PENALTY IF THE CONDITI ONS AS PRESCRIBED UNDER CLAUSES (A) TO (C) ARE SATISFIED. AS PER SUB -SECTION (3) OF SECTION 271AAB THE PROVISIONS OF SECTION 274 AND 275 AS FAR AS MAY BE APPLIED IN RELATION TO THE PENALTY REFERRED IN THIS SECTION WHICH MEANS THAT BEFORE IMPOSING THE PENALTY UNDER SEC. 271AAB, THE AO HAS TO ISSUE A SHOW CAUSE NOTICE AND GIVE A PROPER OPPORTUNITY OF HEARING TO THE ASSESSEE. THUS THE LEVY OF PENALTY U/S. 271AAB IS N OT AUTOMATIC BUT THE A.O. HAS TO TAKE A DECISION TO IMPOSE THE PENAL TY AFTER GIVING A PROPER OPPORTUNITY OF HEARING TO THE ASSESSEE. IT IS STATUTORY REQUIREMENT THAT THE EXPLANATION OF THE ASSESSEE FO R NOT FULFILLING THE CONDITIONS AS PRESCRIBED U/S 271AAB OF THE ACT IS R EQUIRED TO BE CONSIDERED BY THE AO AND PARTICULARLY WHETHER THE E XPLANATION FURNISHED BY THE ASSESSEE IS BONAFIDE AND NON-COMPL IANCE OF THE SAME IS DUE TO THE REASON BEYOND THE CONTROL OF THE ASSE SSEE. THEREFORE, THE ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 12 PENALTY U/S 271AAB IS NOT A CONSEQUENTIAL ACT BUT T HE AO HAS TO FIRST INITIATE PROCEEDINGS BY ISSUING A SHOW CAUSE NOTICE AND AFTER CONSIDERING THE EXPLANATION AND REPLY OF THE ASSESS EE HAS TO TAKE A DECISION. THIS REQUIREMENT OF GIVING AN OPPORTUNIT Y OF HEARING ITSELF MAKES IT CLEAR THAT THE PENALTY U/S 271AAB IS NOT M ANDATORY BUT THE AO HAS TO TAKE A DECISION BASED ON THE FACTS AND CI RCUMSTANCES OF THE CASE OTHERWISE THERE IS NO REQUIREMENT OF ISSUING A NY NOTICE FOR INITIATION OF PROCEEDINGS BUT THE LEVY OF PENALTY W OULD BE CONSEQUENTIAL AND ONLY COMPUTATION OF THE QUANTUM WAS TO BE DONE BY THE AO AS IN THE CASE OF LEVY OF INTEREST AND FEE U/S 234A TO E. EVEN THE QUANTUM OF PENALTY LEVIABLE U/S 271AAB IS ALSO SUBJECT TO T HE CONDITION PRESCRIBED UNDER CLAUSES (A) TO (C) OF SUB-SECTION (1) AND THE AO HAS TO AGAIN GIVE A FINDING FOR LEVY OF PENALTY @ 10% O R 20% OR 30% OF THE UNDISCLOSED INCOME. THUS THE AO IS BOUND TO TA KE A DECISION AS TO WHAT DEFAULT IS COMMITTED BY THE ASSESSEE AND WHICH PARTICULAR CLAUSE OF SECTION 271AAB(1) IS ATTRACTED ON SUCH DEFAULT. FURTHER, MERE DISCLOSURE OF INCOME UNDER SECTION 132(4) WOULD NOT IPSO FACTO PAR TAKE THE CHARACTER OF UNDISCLOSED INCOME BUT THE FA CTS OF EACH CASE ARE REQUIRED TO BE ANALYZED IN OBJECTIVE MANNER SO AS T O ATTRACT THE PROVISIONS OF SECTION 271AAB OF THE ACT. SINCE IT IS NOT AUTOMATIC BUT THE AO HAS TO GIVE A FINDING THAT THE CASE OF THE A SSESSEE FALLS IN THE AMBIT OF UNDISCLOSED INCOME AS DEFINED IN EXPLANATIO N TO THE SAID SECTION. THEREFORE, THE PROVISIONS OF SECTION 271A AB STIPULATE THAT THE AO MAY COME TO THE CONCLUSION THAT THE ASSESSEE SHA LL PAY THE PENALTY. THE ONLY MANDATORY ASPECT IN THE PROVISIO N IS THE QUANTUM OF PENALTY AS SPECIFIED UNDER CLAUSES (A) TO (C) OF SE C. 271AAB(1) OF THE ACT AS 10% TO 30% OR MORE AS AGAINST THE DISCRETION GIVEN TO THE AO AS PER THE PROVISIONS OF SECTION 271(1)(C) OF THE A CT WHERE THE AO HAS THE DISCRETION TO LEVY THE PENALTY FROM 100% TO 300 % OF THE TAX SOUGHT TO BE EVADED. THUS THE AO IS DUTY BOUND TO COME TO THE CONCLUSION THAT THE CASE OF THE ASSESSEE IS FIT FOR LEVY OF PENALTY UNDER SECTION 271AAB AND THEN ONLY THE QUANTUM OF PENALTY BEING 10% OR 20% OR 30% HAS TO BE DETERMINED SUBJECT TO THE EXPL ANATION OF THE ASSESSEE FOR THE DEFAULTS. 5. BEFORE WE PROCEED FURTHER, THE DECISIONS RELIED UPON BY THE LD. D/R ARE TO BE CONSIDERED. IN THE CASE OF PRINCIPAL CIT VS. SANDEEP CHANDAK & OTHERS (SUPRA) THE ISSUE BEFORE THE HONB LE HIGH COURT WAS THE DEFECT IN THE NOTICE ISSUED UNDER SECTION 271AA B ON ACCOUNT OF MENTIONING WRONG PROVISION OF THE ACT BEING 271(1)( C) OF THE ACT. THE HONBLE HIGH COURT AFTER CONSIDERING THE FACT THAT THE SHOW CAUSE ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 13 NOTICE ISSUED BY THE AO THOUGH MENTIONS SECTION 271 (1) IN THE CAPTION OF THE SAID NOTICE, HOWEVER, THE BODY OF THE SHOW C AUSE NOTICE CLEARLY MENTIONS SECTION 271AAB, WHICH WAS FULLY COMPREHEND ED BY THE ASSESSEE AS REVEALS IN THE REPLY FILED BY THE ASSES SEE AGAINST THE SAID SHOW CAUSE NOTICE. HENCE THE HONBLE HIGH COURT HA S HELD AS UNDER :- THE LD. A.RS HAVE ALSO CHALLENGED THAT THE CAPTIO N OF THE NOTICE MENTIONED ONLY SECTION 271 AND NOT 271AAB. I N THIS RESPECT, THE COPY OF NOTICE HAS BEEN PRODUCED BY TH E LD. A.R. BEFORE ME. IT IS SEEN THAT THE LD. A.R IS CORRECT I N OBSERVING THAT THE SECTION OF PENALTY HAS NOT BEEN CORRECTLY MENTI ONED BY THE AO IN THE CAPTION. HOWEVER, THE AO WILL GET THE BE NEFIT OF SECTION 292BB OF THE INCOME TAX ACT, 1961 BECAUSE F IRSTLY, THE ASSESSEE HAS RAISED NO OBJECTION BEFORE THE AO IN T HIS REGARD. SECONDLY, LAST LINE OF THE NOTICE CLEARLY MENTIONS SECTION 271AAB. THIRDLY, THE ASSESSEE HAS GIVEN REPLY TO SA ID NOTICE WHICH SHOWS THAT THE ASSESSEE FULLY COMPREHENDED TH E IMPLICATION OF THE NOTICE THAT IT IS FOR SECTION 27 1AAB. THE ASSESSEE HAS ALSO CHALLENGED THAT THE PRINCIPLE S OF NATURAL JUSTICE HAS NOT FOLLOWED BY THE AO. THE DETAILED SU BMISSIONS OF A.R IN THIS REGARD HAS ALREADY BEEN REPRODUCED ABOV E. THE A.R DID NOT PRODUCE ANY EVIDENCE TO SHOW THAT HE WAS NO T GIVEN PROPER OPPORTUNITY OF HEARING. IT IS CLEAR FROM THE PENALTY ORDER THAT THE AO HAS GIVEN PENALTY NOTICE AND WHICH WAS ALSO REPLIED BY THE ASSESSEE. THEREFORE, IN MY OPINION, PRINCIPL E OF NATURAL JUSTICE HAS NOT BEEN VIOLATED. THUS IN VIEW OF ABOV E DISCUSSION PENALTY IMPOSED BY AO U/S 271AAB OF THE ACT IS CONF IRMED. THUS IT WAS FOUND BY THE HONBLE HIGH COURT THAT TH E MISTAKE IN MENTIONING THE SECTION IN THE SHOW CAUSE NOTICE IS COVERED UNDER SECTION 292BB AND THE AO WILL GET THE BENEFIT OF TH E SAME. THE SAID DECISION WILL NOT HELP THE CASE OF THE REVENUE SO F AR AS THE ISSUE INVOLVES THE MERITS OF LEVY OF PENALTY UNDER SECTIO N 271AAB. AS REGARDS THE DECISION OF KOLKATA BENCHES OF THE TRIB UNAL IN THE CASE OF DCIT VS. AMIT AGARWAL (SUPRA), WE FIND THAT THE SAI D DECISION WAS SUBSEQUENTLY RECALLED BY THE TRIBUNAL AND A FRESH O RDER DATED 14 TH MARCH, 2018 WAS PASSED BY THE TRIBUNAL IN FAVOUR OF THE ASSESSEE. THEREFORE, THE DECISION RELIED UPON BY THE LD. D/R IS NO MORE IN EXISTENCE. ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 14 6. THE QUESTION WHETHER LEVY OF PENALTY UNDER SECTI ON 271AAB BY THE AO IS MANDATORY OR DISCRETIONARY HAS BEEN CONSI DERED BY THE VISAKHAPATNAM BENCH OF THIS TRIBUNAL IN CASE OF ACI T VS. M/S. MARVEL ASSOCIATES (SUPRA) IN PARA 5 TO 7 AS UNDER :- 5. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATE RIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELO W. DURING THE APPEAL HEARING, THE LD. A.R. VEHEMENTLY ARGUED THAT THE A.O. HAS LEVIED THE PENALTY UNDER THE IMPRESSION THAT THE LEVY OF PENALTY IN THE CASE OF ADMISSION O F INCOME U/S 132(4) IS MANDATORY. THE LD. A.R. FURTHER STATED THAT PENALTY U/S 271AAB OF THE ACT IS NOT MANDATORY BUT DISCRETIONARY. THE PROVISIONS OF SECTION 271AAB OF THE ACT IS PARIMATERIA WITH THAT OF SECTION 158BFA OF THE ACT RELATING TO BLOCK ASSESSM ENT AND ACCORDINGLY ARGUED THAT THE LEVY OF PENALTY UNDER SECTION 271AAB IS NOT MAN DATORY BUT DISCRETIONARY. WHEN THERE IS REASONABLE CAUSE, THE PENALTY IS NOT EXIGI BLE. THE LD. A.R. TAKEN US TO THE SECTION 271AAB OF THE ACT AND ALSO SECTION 158BFA(2 ) OF THE ACT AND ARGUED THAT THE WORDS USED IN SECTION 271AAB OF THE ACT AND THE WOR DS USED IN SECTION 158BFA(2) OF THE ACT ARE IDENTICAL. HENCE, ARGUED THAT THE PENAL TY SECTION 271AAB OF THE ACT PENALTY IS NOT AUTOMATIC AND IT IS ON THE MERITS OF EACH CASE. FOR READY REFERENCE, WE REPRODUCE HEREUNDER SECTION 158BFA (2) OF THE ACT A ND SECTION 271AAB OF THE ACT WHICH READS AS UNDER; 271AAB [PENALTY WHERE SEARCH HAS BEEN INITIATED]: (1) THE ASSESSING OFFICER MAY, NOTWITHSTANDING ANYTHING CONTAINED IN ANY OTHER PROVISIONS OF THIS ACT, DIRECT THAT, IN A CASE WHER E SEARCH HAS BEEN INITIATED UNDER SECTION 132 ON OR AFTER THE 1 ST DAY OF JULY, 2012, THE ASSESSEE SHALL PAY BY WAY OF PENALTY, IN ADDITION TO TAX, IF ANY, PAYABLE BY HIM (A) A SUM COMPUTED AT THE RATE OF TEN PER CENT OF T HE UNDISCLOSED INCOME OF THE SPECIFIED PREVIOUS YEAR, IF SUCH ASSESSEE (I) IN THE COURSE OF SEARCH, IN A STATEMENT UNDER SUB-S ECTION (4) OF SECTION 132, ADMITS THE UNDISCLOSED INCOME AND S PECIFIES THE MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED. (II) SUBSTANTIATES THE MANNER IN WHICH THE UNDISCLOSED I NCOME WAS DERIVED; AND (III) ON OR BEFORE THE SPECIFIED DATE (A) PAYS THE TAX, TOGETHER WITH INTEREST, IF ANY, IN RE SPECT OF THE UNDISCLOSED INCOME; AND ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 15 (B) FURNISHES THE RETURN OF INCOME FOR THE SPECIFIED PR EVIOUS YEAR DECLARING SUCH UNDISCLOSED INCOME THEREIN; (B) A SUM COMPUTED AT THE RATE OF TWENTY PER CENT O F THE UNDISCLOSED INCOME OF THE SPECIFIED PREVIOUS YEAR, IF SUCH ASSESSEE (I) IN THE COURSE OF THE SEARCH, IN A STATEMENT UNDER S UB-SECTION (4_) OF SECTION 132, DOES NOT ADMIT THE UNDISCLOSED INCOME; AND (II) ON OR BEFORE THE SPECIFIED DATE (A) DECLARES SUCH INCOME IN THE RETURN OF INCOME FURNIS HED FOR THE SPECIFIED PREVIOUS YEAR; AND (B) PAYS THE TAX, TOGETHER WITH INTEREST, IF ANY, I N RESPECT OF THE UNDISCLOSED INCOME; (C) A SUM WHICH SHALL NOT BE LESS THAN THIRTY PER C ENT BUT WHICH SHALL NOT EXCEED NINETY PER CENT OF THE UNDISCLOSED INCOME OF THE SP ECIFIED PREVIOUS YEAR, IF IT IS NOT COVERED BY THE PROVISIONS OF CLAUSES (A) AND (B). (2) NO PENALTY UNDER THE PROVISIONS OF CLAUSE (C) O F SUB-SECTION (1) OF SECTION 271 SHALL BE IMPOSED UPON THE ASSESSEE IN RESPECT OF THE UNDI SCLOSED INCOME REFERRED TO IN SUB-SECTION (1). SECTION 158BFA(2): (2) THE ASSESSING OFFICER OR THE COMMISSIONER (APP EALS) IN THE COURSE OF ANY PROCEEDINGS UNDER THIS CHAPTER, MAY DIRECT THAT A P ERSON SHALL PAY BY WAY OF PENALTY A SUM WHICH SHALL NOT BE LESS THAN THE AMOUNT OF TA X LEVIABLE BUT WHICH SHALL NOT EXCEED THREE TIMES THE AMOUNT OF TAX SO LEVIABLE IN RESPECT OF THE UNDISCLOSED INCOME DETERMINED BY THE ASSESSING OFFICER UNDER CLAUSE (C ) OF SECTION 158BC: PROVIDED THAT NO ORDER IMPOSING PENALTY SHALL BE MADE IN RE SPECT OF A PERSON IF (I) SUCH PERSON HAS FURNISHED A RETURN UNDER CLAUSE (A) OF SECTION 158BC; (II) THE TAX PAYABLE ON THE BASIS OF SUCH RETURN HAS BEE N PAID OR, IF THE ASSETS SEIZED CONSIST OF MONEY, THE ASSESSEE OFFERS THE MONEY SO SEIZED TO BE ADJUSTED AGAINST THE TAX PAYABLE. (III) EVIDENCE OF TAX PAID IS FURNISHED ALONG WITH THE RE TURN; AND ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 16 (IV) AN APPEAL IS NOT FILED AGAINST THE ASSESSMENT OF TH AT PART OF INCOME WHICH IS SHOWN IN THE RETURN: PROVIDED FURTHER THAT THE PROVISIONS OF THE PRECEDING PROVI SO SHALL NOT APPLY WHERE THE UNDISCLOSED INCOME DETERMINED BY THE ASSE SSING OFFICER IS IN EXCESS OF THE INCOME SHOWN IN THE RETURN AND IN SUC H CASES THE PENALTY SHALL BE IMPOSED ON THAT PORTION OF UNDISCLOSED INCOME DE TERMINED WHICH IS IN EXCESS OF THE AMOUNT OF UNDISCLOSED INCOME SHOWN IN THE RETURN. 6. CAREFUL READING OF SECTION 271AAB OF THE ACT, TH E WORDS USED ARE AO MAY DIRECT AND THE ASSESSEE SHALL PAY BY WAY OF PENALTY. SIM ILAR WORDS ARE USED SECTION 158BFA(2) OF THE ACT. THE WORD MAY DIRECT INDICATES THE DISCRETION TO THE AO. FURTHER, SUB SECTION (3) OF SECTION 271AAB OF THE A CT, FORTIFIES THIS VIEW. SUB SECTION (3) OF SECTION 271AAB: THE PROVISIONS OF SECTION 274 AND 275 SHALL, AS FAR AS MAY BE, APPLY IN RELATION TO THE PENALTY REFERRED TO IN THIS SECTION . 7. THE LEGISLATURE HAS INCLUDED THE PROVISIONS OF S ECTION 274 AND SECTION 275 OF THE ACT IN 271AAB OF THE ACT WITH CLEAR INTENTION TO CO NSIDER THE IMPOSITION OF PENALTY JUDICIALLY. SECTION 274 DEALS WITH THE PROCEDURE FO R LEVY OF PENALTY, WHEREIN, IT DIRECTS THAT NO ORDER IMPOSING PENALTY SHALL BE MADE UNLESS THE ASSESSEE HAS BEEN HEARD OR HAS BEEN GIVEN A REASONABLE OPPORTUNITY OF BEING HE ARD. THEREFORE, FROM PLAIN READING OF SECTION 271AAB OF THE ACT, IT IS EVIDENT THAT THE PENALTY CANNOT BE IMPOSED UNLESS THE ASSESSEE IS GIVEN A REASONABLE O PPORTUNITY AND ASSESSEE IS BEING HEARD. ONCE THE OPPORTUNITY IS GIVEN TO THE ASSESSE E, THE PENALTY CANNOT BE MANDATORY AND IT IS ON THE BASIS OF THE FACTS AND M ERITS PLACED BEFORE THE A.O. ONCE THE A.O. IS BOUND BY THE ACT TO HEAR THE ASSESSEE A ND TO GIVE REASONABLE OPPORTUNITY TO EXPLAIN HIS CASE, THERE IS NO MANDATORY REQUIREM ENT OF IMPOSING PENALTY, BECAUSE THE OPPORTUNITY OF BEING HEARD AND REASONABLE OPPOR TUNITY IS NOT A MERE FORMALITY BUT IT IS TO ADHERE TO THE PRINCIPLES OF NATURAL JU STICE. HONBLE A.P. HIGH COURT IN THE CASE OF RADHAKRISHNA VIHAR IN ITTA NO.740/2011 WHIL E DEALING WITH THE PENALTY U/S 158BFA HELD THAT WE ARE OF THE OPINION THAT WHILE THE WORDS SHALL BE LIABLE UNDER SUB SECTION (1) OF SECTION 158BFA OF THE ACT THAT A RE ENTITLED TO BE MANDATORY, THE WORDS MAY DIRECT IN SUB SECTION 2 THERE OF INTENDED TO DIRECTORY. IN OTHER WORDS, WHILE PAYMENT OF INTEREST IS MANDATORY LEVY OF PENA LTY IS DISCRETIONARY. IT IS TRITE POSITION OF LAW THAT DISCRETION IS VESTED AND AUTHO RITY HAS TO BE EXERCISED IN A REASONABLE AND RATIONAL MANNER DEPENDING UPON THE F ACTS AND CIRCUMSTANCES OF THE EACH CASE. PLAIN READING OF SECTION 271AAB AND 274 OF THE ACT INDICATES THAT THE IMPOSITION OF PENALTY U/S 271AAB OF THE ACT IS NOT MANDATORY BUT DIRECTORY. ACCORDINGLY WE HOLD THAT THE PENALTY U/S 271AAB IS NOT MANDATORY BUT TO BE IMPOSED ON MERITS OF THE EACH CASE. ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 17 THUS THE TRIBUNAL HAS HELD THAT THE LEVY OF PENALTY UNDER SECTION 271AAB IS NOT MANDATORY BUT THE AO HAS THE DISCRETI ON TO TAKE A DECISION AND SHALL BE BASED ON JUDICIOUS DECISION O F THE AO. HENCE WE FORTIFY OUR VIEW BY THE ABOVE DECISIONS OF TRIBUNAL IN CASE OF ACIT VS. MARVEL ASSOCIATES. 7. AS REGARDS THE VALIDITY OF NOTICE UNDER SECTION 274 FOR WANT OF SPECIFYING THE GROUND AND DEFAULT, WE FIND THAT WHE N THE BASIC CONDITION OF THE UNDISCLOSED INCOME NOT RECORDED IN THE BOOKS OF ACCOUNTS DOES NOT EXISTS, THEN THE SAME HAS TO BE S PECIFIED BY THE AO IN THE SHOW CAUSE NOTICE AND FURTHER THE AO IS REQU IRED TO GIVE A FINDING WHILE IMPOSING THE PENALTY UNDER SECTION 27 1AAB. EVEN IF THE AO IS SATISFIED AND COME TO THE CONCLUSION THAT THE ASSESSEE HAS NOT RECORDED THE UNDISCLOSED INCOME IN THE BOOKS OF ACC OUNTS OR IN THE OTHER DOCUMENTS / RECORD MAINTAINED IN NORMAL CO URSE RELATING TO SPECIFIED PREVIOUS YEAR, THE SHOW CAUSE NOTICE SHALL ALSO SPECIFY THE DEFAULT COMMITTED BY THE ASSESSEE TO AT TRACT THE PENALTY @ 10% OR 20% OR 30% OF THE UNDISCLOSED INCOME. THER E IS NO DISPUTE THAT THE AO HAS NOT SPECIFIED THE DEFAULT AND CHARG E AGAINST THE ASSESSEE WHICH NECESSITATED THE LEVY OF PENALTY UND ER SECTION 271AAB OF THE ACT. CONSEQUENTLY, THE ASSESSEE WAS NOT GIVE N AN OPPORTUNITY TO EXPLAIN HIS CASE FOR SPECIFIC DEFAULT ATTRACTING TH E LEVY OF PENALTY IN TERMS OF CLAUSES (A) TO (C) OF SECTION 271AAB(1) OF THE ACT. THE CHANNAI BENCH OF THE TRIBUNAL IN THE CASE OF DCIT V S. SHRI R. ELANGOVAN (SUPRA) AT PAGES 7 TO 10 HAS HELD AS UNDER :- IT IS CLEAR FROM THE SUB SECTION (3) OF SECTION 271 AAB THAT SECTIONS 274 AND SECTION 275 OF THE ACT SHALL, SO FAR AS MAY BE, APPLY. SUB SECTION (1) OF SECTION 274 OF THE ACT MANDATES THAT ORDER IMPOSING PENALTY HAS TO BE IMPOSED ONLY AFTER HEARING THE ASSESSEE OR GIVING A ASSESSEE OPPORTUNITY OF HEARING. OPPORTUNITY THAT IS TO BE GIVEN TO THE ASS ESSEE SHOULD BE A MEANINGFUL ONE AND NOT A FARCE. NOTICE ISSUED TO TH E ASSESSEE REPRODUCED (SUPRA), DOES NOT SHOW WHETHER PENALTY PROCEEDINGS WERE INITIATED FOR CONCEALMENT OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME OR FOR HAVING UNDISCLOSED INCOME WITHIN THE MEANING OF SECTION 271AAB OF THE ACT. NOTICE IN OUR OPINION WAS VAGUE. HONBLE KARNA TAKA HIGH COURT IN THE CASE OF SSAS EMERALD MEADOWS (SUPRA) RELYING IN IT S OWN JUDGMENT IN THE CASE OF MANJUNATHA COTTON AND GINNING FACTORY (SUPR A) HAD HELD AS UNDER:- 2. THIS APPEAL HAS BEEN FILED RAISING THE FOLLOWI NG SUBSTANTIAL QUESTIONS OF LAW: ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 18 (1) WHETHER, OMISSION IF ASSESSING OFFICER TO EXPLICITL Y MENTION THAT PENALTY PROCEEDINGS ARE BEING INITIATE D FOR FURNISHING OF INACCURATE PARTICULARS OR THAT FOR CONCEALMENT OF INCOME MAKES THE PENALTY ORDER LIABL E FOR CANCELLATION EVEN WHEN IT HAS BEEN PROVED BEYON D REASONABLE DOUBT THAT THE ASSESSEE HAD CONCEALED INCOME IN THE FACTS AND CIRCUMSTANCES OF THE CASE? (2) WHETHER, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE TRIBUNAL WAS JUSTIFIED IN LAW IN HOLDING THAT THE PENALTY NOTICE UNDER SECTION 274 R.W.S. 271(1)(C) I S BAD IN LAW AND INVALID DESPITE THE AMENDMENT OF SECTION 271(1B) WITH RETROSPECTIVE EFFECT AND BY VIRTUE OF THE AMENDMENT, THE ASSESSING OFFICER HAS INITIATED THE PENALTY BY PROPERLY RECORDING THE SATISFACTION FOR THE SAME? (3) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE TRIBUNAL WAS JUSTIFIED IN DECIDING THE AP PEALS AGAINST THE REVENUE ON THE BASIS OF NOTICE ISSUED U NDER SECTION 274 WITHOUT TAKING INTO CONSIDERATION THE ASSESSMENT ORDER WHEN THE ASSESSING OFFICER HAS SPE CIFIED THAT THE ASSESSEE HAS CONCEALED PARTICULARS OF INCO ME? 3. THE TRIBUNAL HAS ALLOWED THE APPEAL FILED BY THE ASSESSEE HOLDING THE NOTICE ISSUED BY THE ASSESSING OFFICER UNDER SECTIO N 274 READ WITH SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 (FOR SHORT T HE ACT) TO BE BAD IN LAW AS IT DID NOT SPECIFY WHICH LIMB OF SECTION 271(1)(C) OF THE ACT, THE PENALTY PROCEEDINGS HAD BEEN INITIATED I.E., WHETHER FOR CO NCEALMENT OF PARTICULARS OF INCOME OR FURNISHING OF INACCURATE PARTICULARS O F INCOME. THE TRIBUNAL, WHILE ALLOWING THE APPEAL OF THE ASSESSEE, HAS RELI ED ON THE DECISION OF THE DIVISION BENCH OF THIS COURT RENDERED IN THE CASE O F CIT VS. MANJUNATHA COTTON AND GINNING FACTORY (2013) 359 ITR 565. 4. IN OUR VIEW, SINCE THE MATTER IS COVERED BY JUDG MENT OF THE DIVISION BENCH OF THIS COURT, WE ARE OF THE OPINION, NO SUBSTANTIA L QUESTION OF LAW ARISES IN THIS APPEAL FOR DETERMINATION BY THIS COURT. THE AP PEAL IS ACCORDINGLY DISMISSED. IN THE EARLIER CASE OF MANJUNATHA COTTON AND GINNIN G FACTORY (SUPRA) THEIR LORDSHIP HAD OBSERVED AS UNDER:- NOTICE UNDER SECTION 274 OF THE ACT SHOULD SPECIF ICALLY STATE THE GROUNDS MENTIONED IN SECTION 271(1)(C), I.E., WHETH ER IT IS FOR ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 19 CONCEALMENT OF INCOME OR FOR FURNISHING OF INCORREC T PARTICULARS OF INCOME. SENDING PRINTED FORM WHERE ALL THE GROUNDS MENTIONED IN SECTION 271 ARE MENTIONED WOULD NOT SATISFY THE REQ UIREMENT OF LAW ; THE ASSESSEE SHOULD KNOW THE GROUNDS WHICH HE HAS T O MEET SPECIFICALLY. OTHERWISE, THE PRINCIPLES OF NATURAL JUSTICE ARE OFFENDED. ON THE BASIS OF SUCH PROCEEDINGS, NO PENALTY COULD BE IMPOSED ON THE ASSESSEE ; ) TAKING UP OF PENALTY PROCEEDINGS O N ONE LIMB AND FINDING THE ASSESSEE GUILTY OF ANOTHER LIMB IS BAD IN LAW ; PENALTY PROCEEDINGS ARE DISTINCT FROM THE ASSESSMENT PROCEE DINGS : THOUGH PROCEEDINGS FOR IMPOSITION OF PENALTY EMANATE FROM PROCEEDINGS OF ASSESSMENT, THEY ARE INDEPENDENT AND A SEPARATE ASP ECT OF THE PROCEEDINGS ; THE FINDINGS RECORDED IN THE ASSESSMENT PROCEEDINGS IN SO FAR AS CONCEALMENT OF INCOME AND FURNISHING OF INCORREC T PARTICULARS WOULD NOT OPERATE AS RES JUDICATA IN THE PENALTY PR OCEEDINGS. IT IS OPEN TO THE ASSESSEE TO CONTEST THE PROCEEDINGS ON THE MERITS. HOWEVER, THE VALIDITY OF THE ASSESSMENT OR REASSESS MENT IN PURSUANCE OF WHICH PENALTY IS LEVIED, CANNOT BE THE SUBJECT MATTER OF PENALTY PROCEEDINGS. THE ASSESSMENT OR REASSESSM ENT CANNOT BE DECLARED INVALID IN THE PENALTY PROCEEDINGS. VIEW TAKEN BY THE HONBLE KARNATAKA HIGH COURT IN T HE ABOVE JUDGMENT WAS INDIRECTLY AFFIRMED BY THE HONBLE APEX COURT, WHEN IT DISMISSED AN SLP FILED BY THE REVENUE AGAINST THE JUDGMENT IN THE CASE OF SSAS EMERALD MEADOWS (SUPRA), SPECIFICALLY OBSERVING THAT THERE WAS NO M ERITS IN THE PETITION FILED BY THE REVENUE. CONSIDERING THE ABOVE CITED JUDGMEN TS, WE HOLD THAT THE NOTICE ISSUED U/S.274 R.W.S. 271AAB OF THE ACT, REP RODUCED BY US AT PARA 5 ABOVE WAS NOT VALID. EX-CONSEQUENTI, THE PENALTY OR DER IS SET ASIDE. 6. SINCE WE HAVE SET ASIDE THE PENALTY ORDER FOR TH E IMPUGNED ASSESSMENT YEAR, THE APPEAL FILED BY THE REVENUE HAS BECOME IN FRUCTUOUS. IN VIEW OF THE DECISION OF THE CHENNAI BENCH (SUPRA ), THE SHOW CAUSE NOTICE ISSUED BY THE AO IN THE CASE OF THE ASSESSEE IS NOT SUSTAINABLE. 8. EVEN OTHERWISE, WITHOUT RESTRICTING OURSELVES TO THE VALIDITY OF SHOW CAUSE NOTICE, WE NOTE THAT SECTION 271AAB OF T HE ACT CONTEMPLATES IMPOSITION OF PENALTY PURSUANT TO THE DISCLOSURE OF UNDISCLOSED INCOME IN THE STATEMENT RECORDED UNDER SECTION 132(4) AND, THEREFORE, THE LEVY OF PENALTY UNDER THIS SECT ION DOES NOT DEPEND ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 20 ON THE ADDITION MADE DURING THE ASSESSMENT PROCEEDI NGS. HENCE THE PENALTY PROCEEDINGS UNDER SECTION 271AAB ARE COMPLE TELY INDEPENDENT OF THE ENQUIRY AND FINDING OF THE AO IN THE ASSESSM ENT ORDER EXCEPT FOR THE LIMITATION PROVIDED AS PER SECTION 275 OF THE A CT. WE HAVE ALREADY HELD THAT THE PENALTY IS NOT AUTOMATIC BUT THE AO H AS TO TAKE A DECISION TO IMPOSE THE PENALTY AFTER GIVING AN OPPORTUNITY O F HEARING TO THE ASSESSEE IN TERMS OF SECTION 274 OF THE ACT. THUS T HE AO IN THE PROCEEDINGS UNDER SECTION 271AAB OF THE ACT HAS TO FIRST DECIDE THAT THE CONDITIONS PRESCRIBED UNDER THE SAID SECTION AR E SATISFIED FOR LEVY OF PENALTY AND THEN TO FURTHER TAKE A DECISION AFTER C ONSIDERING THE EXPLANATION OF THE ASSESSEE FOR NON COMPLIANCE OF A NY OF THE CONDITIONS UNDER CLAUSES (A) TO (C) OF SUB-SECTION (1) REGARDING THE QUANTUM OF PENALTY. THE PRIMARY CONDITION FOR LEVY OF PENALTY IS THE EXISTENCE OF UNDISCLOSED INCOME AS PER THE DISCLOSU RE MADE BY THE ASSESSEE UNDER SECTION 132(4). THE TERM UNDISCLOS ED INCOME HAS BEEN DEFINED IN EXPLANATIONS TO SECTION 271AAB. THER EFORE, AS PER THE DEFINITION PROVIDED IN THE EXPLANATION, THE UNDISCLO SED INCOME MAY HAVE VARIOUS FORMS AND THE SAME IS NOT RECORDED IN THE BOOKS OF ACCOUNTS OR OTHER DOCUMENTS MAINTAINED IN NORMAL CO URSE RELATING TO THE SPECIFIED PREVIOUS YEAR. AS PER SUB-CLAUSE (I) OF CLAUSE (C) OF THE EXPLANATION , THE UNDISCLOSED INCOME MEANS ANY INCOME OF THE SPECIFIED PREVIOUS YEAR REPRESENTED BY ANY MONEY, B ULLION, JEWELLERY OR VALUABLE ARTICLE OR THINGS OR ANY ENTRY IN BOOKS OF ACCOUNTS OR OTHER DOCUMENTS OR TRANSACTIONS FOUND IN THE COURSE OF SE ARCH. THIS DEFINITION IS FURTHER SUBJECT TO TWO CONDITIONS THA T THE SAID INCOME HAS NOT BEEN RECORDED ON OR BEFORE THE DATE OF SEARCH I N THE BOOKS OF ACCOUNTS OR OTHER DOCUMENTS MAINTAINED IN THE NORMA L COURSE RELATING TO SUCH PREVIOUS YEAR OR OTHERWISE NOT BEING DISCLO SED TO THE PRINCIPAL CHIEF COMMISSIONER, PRINCIPAL COMMISSIONER OR COMMI SSIONER BEFORE THE DATE OF SEARCH. THE OTHER FORMS OF UNDISCLOSED INCOME AS DEFINED IN SUB CLAUSE (II) IS ANY ENTRY IN RESPECT OF EXPEN SES RECORDED IN THE BOOKS OF ACCOUNTS OR OTHER DOCUMENTS MAINTAINED IN THE NORMAL COURSE. THEREFORE, THE CLAUSE (II) CONTEMPLATES U NDISCLOSED INCOME IN THE FORM OF FALSE ENTRIES OF EXPENSES RECORDED IN T HE BOOKS OF ACCOUNTS WHICH IS NOT RELEVANT FOR THE CASE IN HAND. SINCE IN THE CASE OF ASSESSEE THE TRANSACTIONS OF I NVESTMENT WERE FOUND IN THE DIARY, THEREFORE, WHETHER THESE E NTRIES IN THE DIARY CONSTITUTE UNDISCLOSED INCOME AS PER CLAUSE (C)(I) OF EXPLANATION TO SECTION 271AAB OF THE ACT. THE ASSESSEE IS AN INDI VIDUAL AND FOR THE YEAR UNDER CONSIDERATION THE ASSESSEE HAS NOT REPOR TED ANY BUSINESS INCOME NOR IT WAS ASSESSED BY THE AO. THEREFORE, I T IS CLEAR THAT THE ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 21 ASSESSEE WAS NOT REQUIRED BY ANY MANDATE OF LAW TO MAINTAIN REGULAR BOOKS OF ACCOUNTS. IN THE COMPUTATION OF INCOME, T HE ASSESSEE HAS SHOWN INCOME FROM SALARY, INCOME FROM HOUSE PROPERT Y AND INCOME FROM OTHER SOURCES. THE RETURNED INCOME WAS ACCEPTE D BY THE AO WHILE FRAMING THE ASSESSMENT UNDER SECTION 143(3) A ND HENCE ASSESSEES CASE DOES NOT FALL IN THE CATEGORY WHERE THE REGULAR BOOKS OF ACCOUNTS ARE MANDATORY. THE ENTRIES OF INVESTME NT IN REAL ESTATE WERE FOUND RECORDED IN THE DIARY AND IN THE ABSENCE OF ANY OTHER DOCUMENT MAINTAINED IN THE NORMAL COURSE RELATING T O THE YEAR UNDER CONSIDERATION, THE ENTRIES IN THE DIARY ARE TO BE C ONSIDERED AS RECORDED IN THE DOCUMENTS MAINTAINED IN THE NORMAL COURSE. IT IS NOT THE CASE OF THE REVENUE THAT THE ASSESSEE HAS RECORDED THE O THER TRANSACTIONS IN THE OTHER DOCUMENTS MAINTAINED IN THE REGULAR COURS E RELATING TO THE YEAR UNDER CONSIDERATION AND ONLY THESE ENTRIES ARE RECORDED IN THE DIARY. SINCE THE LEVY OF PENALTY UNDER SECTION 271 AAB IS NOT BASED ON THE ADDITION AND ENQUIRY CONDUCTED BY THE AO IN THE ASSESSMENT PROCEEDINGS, THEREFORE, IT IS INCUMBENT ON THE AO T O CONDUCT A PROPER EXAMINATION OF FACTS, CIRCUMSTANCES AND EXPLANATION FURNISHED BY THE ASSESSEE BEFORE ARRIVING TO THE CONCLUSION THAT PEN ALTY UNDER SECTION 271AAB IS LEVIABLE AND FURTHER WHETHER IT IS 10% OR 20% OR 30% OF SUCH UNDISCLOSED INCOME. THEREFORE, THE AO IS UNDE R STATUTORY OBLIGATION TO EXAMINE ALL THE ISSUES DURING THE PRO CEEDINGS UNDER SECTION 271AAB AFTER GIVING THE ASSESSEE AN OPPORTU NITY TO EXPLAIN THE CHARGES/GROUNDS ON WHICH THE PENALTY IS PROPOSED TO BE LEVIED. HENCE IT IS A PRE-REQUISITE CONDITION THAT THE AO FIRST S PECIFY THE CHARGES AGAINST THE ASSESSEE AND TO MAKE KNOWN THE ASSESSEE OF HIS DEFAULT SO AS TO AFFORD AN OPPORTUNITY TO EXPLAIN THE DEFAULT/ CHARGES SO BROUGHT AGAINST THE ASSESSEE. WITHOUT CONSIDERING THE EXPL ANATION OF THE ASSESSEE ON THE SPECIFIC DEFAULT, THE ORDER PASSED BY THE AO UNDER SECTION 271AAB SUFFERS FROM SERIOUS ILLEGALITY AND THEREFORE NOT SUSTAINABLE IN LAW. WHEN A STRINGENT ACTION IS PRO VIDED IN THE STATUTE AGAINST THE DEFAULT COMMITTED BY THE ASSESSEE, THEN IT ALSO CAST AN EQUALLY STRINGENT AND STRICT DUTY ON THE AUTHORITY RESPONSIBLE TO TAKE SUCH ACTION. THEREFORE, WHEN THE PROVISIONS FOR LE VY OF PENALTY UNDER SECTION 271AAB IS A SPECIFIC PROVISION TO DEAL WITH THE UNDISCLOSED INCOME AND IT PROVIDES A STRICT PENAL ACTION THEN T HE CORRESPONDING DUTY OF THE TAX AUTHORITY IS ALSO EQUALLY STRINGENT . THE AO CANNOT ESCAPE FROM FOLLOWING THE STRICT MANDATORY REQUIREM ENT OF LAW AND PARTICULARLY THE PRINCIPLE OF NATURAL JUSTICE. THE AO HAS NEITHER SPECIFIED THE GROUNDS AND CLAUSE OF SECTION 271AAB NOR HAS DEALT WITH THE SAME IN THE IMPUGNED ORDER PASSED UNDER SECTION 271AAB. THE ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 22 AO HAS ALSO NOT GIVEN A FINDING THAT THE CASE OF TH E ASSESSEE FALLS IN THE DEFINITION OF UNDISCLOSED INCOME PROVIDED UNDER CLAUSE (C)(I) OF EXPLANATION TO SECTION 271AAB. WHEN THE TRANSACTION S OF INVESTMENT IN REAL ESTATE ARE RECORDED IN THE DIARY BEING OTHE R DOCUMENTS MAINTAINED BY THE ASSESSEE FOR THE SAID PURPOSE, TH EN IN THE ABSENCE OF ANY REQUIREMENT OF MAINTAINING REGULAR BOOKS OF ACCOUNTS BY THE ASSESSEE, THE CASE OF THE ASSESSEE WOULD NOT FALL I N THE DEFINITION OF UNDISCLOSED INCOME AS PER CLAUSE (C) OF EXPLANATION TO SECTION 271AAB OF THE ACT. 9. THE KOLKATA BENCH OF THE TRIBUNAL IN THE CASE OF DCIT VS. MADAN LAL BESWAL (SUPRA) HAS CONSIDERED THIS ISSUE OF THE ALLEGED INCOME FOUND RECORDED IN THE OTHER DOCUMENTS WOULD FALL IN THE DEFINITION OF UNDISCLOSED INCOME IN PARA 3 AND 4 AS UNDER :- 3. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUG H THE FACTS AND CIRCUMSTANCES OF THE CASE. WE FIND THAT T HE ISSUE INVOLVED HEREIN IS SQUARELY COVERED IN FAVOUR OF THE ASSESSE E IN THE CASE OF DCIT VS MANISH AGARWALA (ANOTHER MEMBER IN THE SAME NEZONE GROUP) IN ITA NO. 1479/KOL/2015 FOR AY 2013-14 DATE D 9.2.2018 BY THE ORDER OF THIS TRIBUNAL , WHEREIN IT WAS HELD AS UNDER:- 3. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. WE NOTE THAT THE AO HAS LEVIED THE PENALTY U/S. 271AAB ON THE GROUND THAT THE INCOME FROM COMM ODITY PROFIT HAS BEEN FOUND DURING SEARCH U/S.132 OF THE ACT WHICH I S NOT REFLECTED IN THE REGULAR BOOKS OF ACCOUNT. THE AO HAS ACCEPTED T HAT DURING SEARCH THE ASSESSEE HAS ADMITTED U/S. 132(4) OF THE ACT TH E INCOME FROM SPECULATIVE TRADING. THE UNDISPUTED FACTS THE AO HA S GIVEN FINDING PERTAINING TO THIS CASE IS AS FOLLOWS: I) THE ASSESSEE HAS SUBSTANTIATED THE MANNER IN WHI CH THE INCOME WAS DERIVED. II) FURNISHED THE RETURN OF INCOME THEREIN AND III) PAID THE TAX ALONG WITH INTEREST. BASED ON THE SAID FINDING, ACCORDING TO AO, THE ASS ESSEE SATISFIES THE CONDITIONS ENUMERATED IN SEC. 271AAB(I)(A) OF THE A CT AND THEREAFTER LEVIED TEN PERCENT OF RS.3 CR., WHICH HAVE BEEN DEL ETED BY THE IMPUGNED ORDER OF LD. CIT(A). 4. THE LD. DR BROUGHT TO OUR NOTICE THAT IN THE VE RY SAME GROUP CASE OF MANOJ BESWAL & ORS. THE TRIBUNAL HAD CONFIRMED THE ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 23 LEVY OF PENALTY AND CONTENDED BEFORE US THAT PENALT Y U/S. 271AAB OF THE ACT IS MANDATORY AND THEREFORE, ACCORDING TO LD. DR, THE LD. CIT(A) ERRED IN DELETING THE PENALTY BY STATING THA T THE ASSESSEE DID NOT HAD ANY MENS REA NOT TO DISCLOSE THE AMOUNT I N QUESTION. ACCORDING TO HIM, PENALTY HAS TO BE MANDATORILY LEV IED U/S. 271AAB OF THE ACT ON THE UNDISCLOSED INCOME FOUND DURING S EARCH. ON THE OTHER HAND, LD. AR SHRI MIRAZ D. SHAH, SUPPORTING T HE DECISION OF LD. CIT(A) MADE CONTENTIONS THOUGH TAKEN UP BEFORE THE LD. CIT(A) BUT HAS NOT BEEN ADJUDICATED ON THOSE AVERME NTS, WHICH THE LD. AR URGES BEFORE US TO CONSIDER WHILE ADJUDI CATING THE APPEAL OF THE REVENUE. THE LD. AR ALSO POINTED OUT THAT THE CONTENTIONS WHICH HE IS GOING TO RAISE HAS BEEN TAK EN UP BEFORE THE AO ALSO, HOWEVER, ACCORDING TO LD. COUNSEL, THO SE LEGAL ARGUMENTS WERE NOT CONSIDERED BY THE AO IN THE RIGH T PERSPECTIVE. THE FIRST CONTENTION OF THE LD. AR IS THAT SINCE SE C. 271AAB OF THE ACT IS A PENALTY SECTION IT SHOULD BE CONSTRUED STR ICTLY, WHICH WE AGREE BEING IT IS A TRITE LAW THAT PENALTY PROVISIO NS HAVE TO BE STRICTLY INTERPRETED. NEXT CONTENTION OF LD. AR IS THAT SEC. 271AAB OF THE ACT IS NOT MANDATORY BECAUSE PARLIAMENT IN I TS WISDOM HAS USED THE WORD MAY AND NOT SHALL. SO, ACCORDING TO HIM, IT IS THE DISCRETION BESTOWED UPON THE AO WHETHER TO INITIATE AND IMPOSE PENALTY U/S. 271AAB OF THE ACT. WE AGREE WITH THE S AID CONTENTION OF LD. AR BECAUSE WHEN A SIMILAR ISSUE WAS ADJUDICA TED BY ITAT LUCKNOW (THE AUTHOR OF THIS ORDER WAS A MEMBER OF T HE BENCH) IN SANDEEP CHANDAK & ORS. VS. CIT (2017) 55 ITR (TRIB) 209 AND 2017 (5) TMI 675- ITAT-LUCKNOW IN ITA NO. 416, 417 AND 418/LKW/2016 DATED 30.01.2017 WHILE ADJUDICATING A CASE WHERE PENALTY WAS LEVIED UNDER SECTION 271AAB OF THE ACT IT WAS HELD THAT THE PROVISIONS OF SEC. 271AAB OF THE ACT ARE NOT MA NDATORY, WHICH MEANS THAT PENALTY NEED NOT BE LEVIED IN EACH AND E VERY CASE WHEREVER THE ASSESSEE HAS MADE DEFAULT AS STATED IN CLAUSES (A), (B) AND (C) OF THE ACT. SUB-SECTION (1) OF SEC. 271 AAB OF THE ACT USES THE WORD MAY NOT SHALL. MAY CANNOT BE EQ UATED WITH SHALL ESPECIALLY IN PENALTY PROCEEDING. USING THE WORD MAY IN OUR OPINION, GIVES A DISCRETION TO THE AO TO LEVY T HE PENALTY OR NOT TO LEVY, EVEN IF THE ASSESSEE HAS MADE THE DEFAULT UNDER THE SAID PROVISION. THEREFORE, THE 2 ND GROUND OF REVENUE FAILS AND WE HOLD THAT PENALTY U/S. 271AAB OF THE ACT IS NOT MANDATOR Y AND IS DISCRETIONARY. BEFORE PROCEEDING FURTHER, WE NOTE T HAT THE EX PARTE ORDER PASSED BY THE COORDINATE BENCH RELIED UPON BY LD. DR, MANOJ BESWAL, SUPRA, HAVE BEEN RECALLED IN MA NOS. 218 TO 220/KOL/2017 DATED 12.01.2018 BY OBSERVING AS UNDER : BY VIRTUE OF THESE MISCELLANEOUS APPLICATIONS, THE ASSESSEE SEEKS TO RECALL THE ORDER PASSED BY THIS TRIBUNAL I N I.T.A. ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 24 NOS. 1471, 1475&1476/KOL/2015 IN THE HANDS OF AMIT AGARWAL, MADAN LAL BESWAL AND MANOJ BESWAL RESPECTI VELY FOR THE ASSESSMENT YEAR 2013-14 ON THE GROUND THAT NOTICE WAS NOT SERVED ON THE ASSESSEE FOR THE HEARING AND ON CERTAIN FACTUAL ERROR THAT HAD CREPT IN THE ORDER O F THE TRIBUNAL. THE FIRST PRELIMINARY OBJECTION RAISED BY THE LD. AR WAS THAT THE NOTICE OF HEARING WAS NOT SERVED ON TH E ASSESSEE FOR THE HEARING SCHEDULED ON 06.11.2017 AN D HENCE, THE ASSESSEE COULD NOT BE PRESENT ON THE SAI D DATE BY WAY OF PERSONAL APPEARANCE. THE SECOND OBJECTION RAISED BY THE LD. AR WAS THAT THE TRIBUNAL HAD STAT ED IN PARA 9 OF ITS ORDER THAT THE ASSESSEE HIMSELF HAD A CCEPTED THAT HE IS ENGAGED IN COMMODITIES TRADING BUSINESS AND THEREFORE MANDATED TO MAINTAIN BOOKS OF ACCOUNTS IN TERMS OF SECTION 44AA OF THE ACT AND THEREBY INFERRING TH AT THE ASSESSEE HAD REPORTED THE PROFIT FROM COMMODITIES T RADING BUSINESS UNDER THE HEAD INCOME FROM BUSINESS OR PROFESSION. BASED ON THIS CRUCIAL FINDING, THE TRI BUNAL HAD CONCLUDED THAT SINCE THE TRANSACTION OF COMMODITIES TRADING HAD NOT BEEN ENTERED BY THE ASSESSEE IN HIS BOOKS O F ACCOUNTS AS ON THE DATE OF SEARCH ON 01.08.2012 AND THEREBY IT TAKES THE CHARACTER OF UNDISCLOSED INCOM E FOR WHICH PENALTY U/S 271AAB OF THE ACT IS EXIGIBLE. IN THIS REGARD, WE FIND THAT THE LD. AR DREW OUR ATTENTION TO THE COMPUTATION OF THE TOTAL INCOME WHEREIN THE ASSESSE E HAD OFFERED INCOME FROM COMMODITY TRADING ONLY UNDER TH E HEAD INCOME FROM OTHER SOURCES. WE ALSO FIND THAT THE LD . AO HAD ALSO SPECIFICALLY STATED IN THE BODY OF THE ASS ESSMENT ORDER VIDE COLUMN NO. 10 THAT THE ASSESSEE IS HAVIN G ONLY SALARY INCOME AND INCOME FROM OTHER SOURCES. WE FIN D THAT DUE TO THE ABSENCE OF THE ASSESSEE AT THE TIME OF H EARING THIS PARTICULAR FACT HAD ESCAPED THE ATTENTION OF T HE TRIBUNAL. ON PERUSAL OF THE FACT AVAILABLE ON RECORD, WE FIND THAT THE FINDING RECORDED BY THIS TRIBUNAL IN PARA 9 OF ITS ORDER DATED 10.11.2017 THAT THE ASSESSEE IS MANDATED TO MAINTAI N BOOKS OF ACCOUNTS U/S 44AA OF THE ACT IS FACTUALLY INCORRECT AND DESERVES TO BE RECTIFIED. THIS MISTAKE OF PRIMA RY FACT HAD LEAD TO A CONCLUSION OF UPHOLDING THE LEVY OF P ENALTY U/S 271AAB OF THE ACT. HENCE, IN THESE FACTS AND CIRCUM STANCES AND IN VIEW OF THE AFORESAID MISTAKE OF PRIMARY FAC T RIGHTLY POINTED OUT BY THE LD. AR , WE DEEM IT FIT TO RECAL L THE ORDERS OF THIS TRIBUNAL DATED 10.11.2017 IN THE CASE OF AF ORESAID ASSESSEES. ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 25 IN THE AFORESAID SCENARIO, THE LEGAL POSITION IS TH AT AN ORDER WHICH HAS BEEN RECALLED FOR DE NOVO ADJUDICATION, IS NO O RDER IN THE EYES OF LAW AND SO IT CANNOT BE TREATED AS A PRECEDENT. HENCE, THE RELIANCE PLACED BY THE LD. DR IN RESPECT OF ASSESSE ES IN THE SAME GROUP CONCERN CASES AS DECIDED BY THE TRIBUNAL NO L ONGER SURVIVES AND CANNOT BE TREATED AS COVERED AGAINST THE ASSESS EE. 5. THE THIRD CONTENTION OF THE LD. AR IS THAT THE ASSESSEE IS AN INDIVIDUAL, WHO WAS DRAWING SALARY INCOME. SO, ACCO RDING TO HIM, HE NEED NOT MAINTAIN ANY BOOKS OF ACCOUNT AS PER TH E ACT. ACCORDING TO LD. AR, UNDISPUTEDLY THE ASSESSEE WAS ENGAGED FOR THE FIRST TIME THIS AY ONLY IN TRADING OF COMMODITI ES, THAT TOO WHICH WAS CONDUCTED IN A NON-SYSTEMATIC MANNER AND THE IN COME FROM IT WAS DULY OFFERED TO TAX BY THE ASSESSEE IN HIS RETURN OF INCOME UNDER THE HEAD INCOME FROM OTHER SOURCES, WHICH, ACCORDING TO LD. AR WAS ACCEPTED AS SUCH BY THE AO AND DREW OUR ATTENTION TO PAGE ONE OF ASSESSMENT ORDER, (NOT THE PENALTY ORDER) WHEREIN WE NOTE THAT THE AO HAS ACKNOWLEDGED THAT T HE ASSESSEE OWNED UP RS. 3 CR. AS HIS INCOME FROM COMMODITY PRO FIT AND IT HAS BEEN DISCLOSED IN HIS INCOME AND EXPENDITURE FOR AY 2013-14 UNDER THE HEAD INCOME OUT OF SPECULATIVE BUSINESS FROM SALE OF COMMODITIES, AND THEREAFTER THE AO CONFIRMED THE A SSESSEES CLAIM AND THEREAFTER TOTAL INCOME WAS ASSESSED BY T HE AO AS PER THE RETURN SUBMITTED BY THE ASSESSEE. IN THE LIGHT OF THE AFORESAID FACTS DISCERNED FROM ASSESSMENT ORDER, THE ASSESSEE S CASE IS THAT FOR THE FIRST TIME IN THIS AY HE WAS DOING UNSYSTEM ATIC SPECULATIVE ACTIVITY WHICH EARNED INCOME AND, IT WAS BROUGHT UN DER THE HEAD INCOME FROM OTHER SOURCES, AND SO, ACCORDINGLY, H E IS NOT REQUIRED TO MAINTAIN BOOKS OF ACCOUNT AS STIPULATED IN SEC. 44AA OR SEC. 44AA(2)(II) OF THE ACT BECAUSE, THESE PROVISIO NS ARE ONLY FOR ASSESSES WHO ARE EARNING INCOME UNDER THE HEAD BUS INESS OR PROFESSION. WE NOTE THAT SEC. 44AA OR SEC. 44AA(2) (II) OF THE ACT CASTS A DUTY UPON THE ASSESSEE WHO ARE INTO BUSINE SS OR PROFESSION AND SUCH ASSESSEES ARE BOUND TO MAINTA IN BOOKS OF ACCOUNT AS STIPULATED THEREIN. FOR APPRECIATING THI S SUBMISSION LET US GO THROUGH THE PROVISIONS OF LAW. 44AA. (1) EVERY PERSON CARRYING ON LEGAL, MEDICA L, ENGINEERING OR ARCHITECTURAL PROFESSION OR THE PROF ESSION OF ACCOUNTANCY OR TECHNICAL CONSULTANCY OR INTERIOR DE CORATION OR ANY OTHER PROFESSION AS IS NOTIFIED BY THE BOARD IN THE OFFICIAL GAZETTE SHALL KEEP AND MAINTAIN SUCH BOOKS OF ACCOUNT AND OTHER DOCUMENTS AS MAY ENABLE THE [ASSESSING] OFFICER TO COMPUTE HIS TOTAL INCOME IN ACCORDANCE WITH THE PROVISIONS OF THIS ACT. (2) EVE RY PERSON ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 26 CARRYING ON BUSINESS OR PROFESSION [NOT BEING A PRO FESSION REFERRED TO IN SUBSECTION (1)] SHALL, (I) IF HIS INCOME FROM BUSINESS OR PROFESSION EXCE EDS [ONE LAKH TWENTY] THOUSAND RUPEES OR HIS TOTAL SALES, TURNOVE R OR GROSS RECEIPTS, AS THE CASE MAY BE, IN BUSINESS OR PROFES SION EXCEED OR EXCEEDS [TEN LAKH] RUPEES IN ANY ONE OF T HE THREE YEARS IMMEDIATELY PRECEDING THE PREVIOUS YEAR; OR (II) WHERE THE BUSINESS OR PROFESSION IS NEWLY SET UP IN ANY PREVIOUS YEAR, IF HIS INCOME FROM BUSINESS OR PROFE SSION IS LIKELY TO EXCEED [ONE LAKH TWENTY] THOUSAND RUPEES OR HIS TOTAL SALES, TURNOVER OR GROSS RECEIPTS, AS THE CAS E MAY BE, IN BUSINESS OR PROFESSION ARE OR IS LIKELY TO EXCEE D [TEN LAKH] RUPEES, [DURING SUCH PREVIOUS YEAR; OR (III) WHERE THE PROFITS AND GAINS FROM THE BUSINESS ARE DEEMED TO BE THE PROFITS AND GAINS OF THE ASSESSEE UNDER [ SECTION 44AE] [OR SECTION 44BB OR SECTION 44BBB], AS THE CA SE MAY BE, AND THE ASSESSEE HAS CLAIMED HIS INCOME TO BE L OWER THAN THE PROFITS OR GAINS SO DEEMED TO BE THE PROFI TS AND GAINS OF HIS BUSINESS, AS THE CASE MAY BE, DURING S UCH [PREVIOUS YEAR; OR]] (IV) WHERE THE PROFITS AND GAINS FROM THE BUSINESS ARE DEEMED TO BE THE PROFITS AND GAINS OF THE ASSESSEE UNDER S ECTION 44AD AND HE HAS CLAIMED SUCH INCOME TO BE LOWER THA N THE PROFITS AND GAINS SO DEEMED TO BE THE PROFITS AND G AINS OF HIS BUSINESS AND HIS INCOME EXCEEDS THE MAXIMUM AMO UNT WHICH IS NOT CHARGEABLE TO INCOME-TAX DURING SUCH P REVIOUS YEAR,] KEEP AND MAINTAIN SUCH BOOKS OF ACCOUNT AND OTHER D OCUMENTS AS MAY ENABLE THE [ASSESSING] OFFICER TO COMPUTE HIS T OTAL INCOME IN ACCORDANCE WITH THE PROVISIONS OF THIS ACT. (3) THE BOARD MAY, HAVING REGARD TO THE NATURE OF THE BUSINESS OR PROFESSION CARRIED ON BY ANY CLASS OF PERSONS, PRESCRIBE, BY R ULES, THE BOOKS OF ACCOUNT AND OTHER DOCUMENTS (INCLUDING INVENTORI ES, WHEREVER NECESSARY) TO BE KEPT AND MAINTAINED UNDER SUB-SECT ION (1) OR SUB- SECTION (2), THE PARTICULARS TO BE CONTAINED THEREI N AND THE FORM AND THE MANNER IN WHICH AND THE PLACE AT WHICH THEY SHA LL BE KEPT AND MAINTAINED. ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 27 (4) WITHOUT PREJUDICE TO THE PROVISIONS OF SUB-SEC TION (3), THE BOARD MAY PRESCRIBE, BY RULES, THE PERIOD FOR WHICH THE B OOKS OF ACCOUNT AND OTHER DOCUMENTS TO BE KEPT AND MAINTAINED UNDER SUB-SECTI ON (1) OR SUB- SECTION (2) SHALL BE RETAINED.] SO FROM A READING OF THE ABOVE PROVISIONS WHICH CLE ARLY STIPULATES THAT ASSESSEE WHO ARE CARRYING ON BUSINESS OR PROFESSION SHALL KEEP AND MAINTAIN SUCH BOOKS OF ACCOUNT AND OTHER DOCUMENTS WHICH MAY ENABLE THE AO TO COMPUTE THE TOTAL INCOME. WE NOTE THAT AS SESSEE IN THE STATEMENT OF TOTAL INCOME FILED BEFORE THE AO HAS S HOWN INCOME ONLY UNDER TWO HEADS (I) SALARY INCOME (II) INCOME FROM OTHER SOURCES. WE WOULD LIKE TO REPRODUCE THE SUMMARY OF TOTAL INCOME OF THE ASSESSEE FILED ALONG WITH THE RETURN: INCOME FROM SALARY RS. 45,57,600 INCOME FROM OTHER SOURCES RS.3,00,24,047 RS.3,45,81,647 6. WE NOTE THAT THE AO HAS ACCEPTED THE AFORESAID STATEMENT OF TOTAL INCOME FILED BEFORE HIM WITHOUT CONTESTING THE CLAI M OF THE ASSESSEE AS TO WHETHER THE ASSESSEES CLAIM OF INCOME OTHER THAN F ROM SALARY SHOULD BE FROM INCOME FROM BUSINESS. THE CONFUSION THAT HAS ARISEN IN THIS CASE, WE NOTE IS ON THE MISDIRECTION OF AO IN THE ASSESSM ENT PROCEEDINGS WHEREIN THE ASSESSMENT ORDER OF THE ASSESSEE, THE A O HAS OBSERVED DURING SEARCH AND SEIZURE OPERATION, SHRI MANOJ BE SWAL HAD MADE A CONSOLIDATED DISCLOSURE OF RS.32 CRORE VIDE HIS DIS CLOSURE PETITION. OUT OF THIS CONSOLIDATED DISCLOSURE, THE ASSESSEE OWNED UP RS. 3 CR. IN THE DISCLOSURE PETITION SHRI MANOJ BESWAL IT WAS STATED THAT THE SOURCE OF SUCH UNDISCLOSED INCOME WAS OUT OF COMMODITY PROFIT. IT HAS BEEN SUBMITTED THAT THE AMOUNT HAS ALREADY BEEN DISCLOSED IN HIS I NCOME & EXPENDITURE ACCOUNT FOR THE AY 2013-14 UNDER THE HEAD INCOME O UT OF SPECULATIVE BUSINESS FROM SALE OF COMMODITIES. VERIFICATION OF ACCOUNTS CONFIRMS HIS CLAIM. THIS OBSERVATION IS FLAWED BECAUSE, WE NOTE THAT AO GOT CARRIED AWAY BY PERUSAL OF THE INCOME & EXPENDITURE ACCOUN T FOR AY 2013-14 SUBMITTED BY THE ASSESSEE BEFORE HIM, WHEREIN IT WA S SHOWN IN THE INCOME SIDE THAT IS RIGHT HAND COLUMN AS INCOME FR OM SPECULATIVE BUSINESS FROM SALE OF COMMODITIES AND LEFT HAND SI DE COLUMN REFLECTS THE EXPENDITURE; AND AO CAME TO THE CONCLUSION THAT ASS ESSEE HAS DISCLOSED UNDER THE HEADING INCOME OUT OF SPECULATIVE BUSINES S FROM SALE OF COMMODITIES. THE CHARACTER OF A RECEIPT AND THE HEA D UNDER WHICH IT HAS TO BE TAXED IS NOT BASED ON THE NOMENCLATURE OF REC EIPT OF INCOME SHOWN IN INCOME & EXPENDITURE ACCOUNT. ALL THE INCOMES OF REVENUE NATURE WILL BE POSTED IN THE RIGHT HAND SIDE COLUMN OF INCOME IN THE INCOME & EXPENDITURE ACCOUNT AND THE DESCRIPTION GIVEN THERE IN CANNOT DETERMINE ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 28 THE HEAD OF INCOME PRESCRIBED UNDER CHAPTER IV OF T HE ACT. THEREFORE, THE OBSERVATION OF THE AO IN ASSESSMENT ORDER IN THE LI GHT OF HIS ACTION OF ACCEPTING THE STATEMENT OF TOTAL INCOME FILED BY TH E ASSESSEE ALONG WITH RETURN WHICH WITHOUT BEING CONTESTED, IS ERRONEOUS, UNLESS THE AO WAS ABLE TO NEGATE THE CLAIM OF THE ASSESSEE BY BRINGIN G THE INCOME FROM COMMODITY TRANSACTIONS AS PART OF BUSINESS INCOME. IT SHOULD BE REMEMBERED THAT UNDER THE INCOME TAX ACT 1961, THE TOTAL INCOME OF AN ASSESSEE INDIVIDUAL /COMPANY IS CHARGEABLE TO TAX U/S. 4 OF THE ACT. TH E TOTAL INCOME HAS TO BE COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF TH E ACT. SECTION 14 OF THE ACT LAYS DOWN THAT FOR THE PURPOSE OF COMPUTATI ON, INCOME OF AN ASSESSEE HAS TO BE CLASSIFIED UNDER FIVE HEADS. IT IS POSSIBLE FOR AN ASSESSEE/INDIVIDUAL/COMPANY TO HAVE FIVE DIFFERENT SOURCES OF INCOME, EACH ONE OF IT WILL BE CHARGEABLE TO INCOME TAX ACT . PROFITS AND GAINS OF BUSINESS OR PROFESSION IS ONLY ONE OF THE HEADS UND ER WHICH AN ASSESSEES INCOME IS LIABLE TO BE ASSESSED TO TAX. IF AN ASSESSEE HAS NOT COMMENCED BUSINESS THERE CANNOT BE ANY QUESTION OF ASSESSMENT OF ITS PROFITS AND GAINS OF BUSINESS. THAT DOES NOT MEAN T HAT UNTIL AND UNLESS THE ASSESSEE COMMENCES ITS BUSINESS, ITS INCOME FROM AN Y OTHER SOURCE WILL NOT BE TAXED AS HELD BY THE HONBLE SUPREME COURT I N THE CASE OF TUTICORIN ALKALI & CHEMICALS LTD. VS. CIT (1997) 22 7 ITR 172 (SC). IT HAS BEEN FURTHER HELD THAT WHEN THE QUESTION IS WHETHER A RECEIPT OF MONEY IS TAXABLE OR NOT OR WHETHER CERTAIN DEDUCTION FROM TH AT RECEIPT IS PRINCIPLES OF LAW AND NOT IN ACCORDANCE WITH ACCOUNTANCY PRACT ICE. FURTHER, THE HONBLE APEX COURT HELD THAT THE QUESTION AS TO WHE THER A PRINCIPAL RECEIPT IS OF THE NATURE OF INCOME AND FALLS WITHIN THE CHA RGE OF SEC. 4 OF THE ACT IS A QUESTION OF LAW WHICH HAS TO BE DECIDED BY THE CO URT ON THE BASIS OF THE PROVISIONS OF THE ACT AND INTERPRETATION OF THE TER M INCOME GIVEN IN A LARGE NUMBER OF DECISIONS OF THE HONBLE SUPREME CO URT, HIGH COURT AND PRIVY COUNCIL. AFTER TAKING NOTE OF THE APEX COURT ORDER AS ABOVE, WE NOTE THAT THE AO IN THE ASSESSMENT ORDER AFTER HAVING AC CEPTED THE STATEMENT OF TOTAL INCOME (SUPRA) AND THE RETURN WHEREIN THE ASSESSEE HAS SHOWN THE INCOME FROM COMMODITIES UNDER THE HEAD INCOME FROM OTHER SOURCES CANNOT NOW AFTER PERUSAL OF INCOME & EXPE NDITURE ACCOUNT DETERMINE THE CHARACTER OF TRANSACTION IN THE PENAL TY PROCEEDINGS AS INCOME FROM BUSINESS OR PROFESSION WHICH APPROACH /ACTION IS ERRONEOUS. WE NOTE THAT THE ASSESSEE IN HIS STATEMENT OF TOTAL INCOME ALONG WITH RETURN HAS CLASSIFIED HIS INCOME UNDER TWO HEADS (I ) SALARY AND (II) FROM OTHER SOURCES AND THE INCOME OF RS. 3 CR. AS INCOME FROM OTHER SOURCES, WHICH WE FIND THE AO HAS NOT CONTESTED IN THE ASSES SMENT ORDER, HAS THUS CRYSTALLIZED AND THE NECESSARY INFERENCE DRAWN IS T HAT ASSESSEE AN INDIVIDUAL WHO WAS ADMITTEDLY A SALARIED PERSON ENG AGED IN THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDER ATION (THAT TOO FOR THE FIRST TIME) IN AN ACTIVITY FROM WHICH HE DERIVED I NCOME FROM OTHER SOURCES ARE NOT REQUIRED TO MAINTAIN BOOKS OF ACCO UNT WHICH ARE ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 29 APPLICABLE ONLY IF THE ASSESSEE WAS ENGAGED IN BUSI NESS OR PROFESSION. HOWEVER, WE FURTHER NOTE THAT THE TRANSACTIONS WHIC H YIELDED INCOME, THE ASSESSEE HAD IN FACT MAINTAINED RECORDS FROM WHICH THE AO WAS ABLE TO DEDUCE THE TRUE INCOME AND EXPENDITURE OF THE ASSES SEE. WE NOTE THE AO IN THE ASSESSMENT ORDER HAS ACCEPTED THE RETURNED I NCOME COMPRISING OF INCOME FROM SALARY AND INCOME FROM OTHER SOURCES BY OBSERVING AS UNDER : TOTAL INCOME ASSESSED AS PER RETURN RS.3,44,65,120 /-. AND FURTHER WE NOTE THAT THE AO HAD SPECIFICALLY ST ATED IN THE BODY OF THE ASSESSMENT ORDER VIDE COLUMN NO. 10 THAT THE ASSESS EE IS HAVING ONLY SALARY INCOME AND INCOME FROM OTHER SOURCES. THUS F ROM A PERUSAL OF THE ASSESSMENT ORDER, IT IS NOT IN DISPUTE THAT ASSESSE E IS NOT ENGAGED IN ANY BUSINESS. AND THE AO CANNOT CHANGE THE CHARACTER OF INCOME IN A DERIVATIVE PROCEEDING WHICH IS AN OFF-SHOOT OF ASSE SSMENT PROCEEDINGS I.E. THE PENALTY PROCEEDINGS WITHOUT CONTESTING AND MAKI NG A FINDING AGAINST THE CLAIM OF THE ASSESSEE IN THE ASSESSMENT ORDER A S DISCUSSED ABOVE. 7. FINALLY, THE LD. AR SUBMITTED THAT DURING THE S EARCH, THE SEARCH PARTY FOUND THE RECORDS OF THE ASSESSEES TRANSACTI ONS IN SPECULATIVE COMMODITY FROM THE DRAWER OF ASSESSEES ACCOUNTANT FROM WHICH THE AO COULD COMPUTE THE INCOME OF THE ASSESSEE FROM THE S AID TRANSACTION WHICH AMOUNT ASSESSEE DECLARED DURING SEARCH AND WHICH WA S DULY RETURNED AND WHICH FIGURE WAS ACCEPTED BY THE AO. ACCORDING TO LD. AR, THE FACT THAT SEARCH HAPPENED ON 01.08.2012 NEED TO BE TAKEN NOTE OF SINCE UNDISPUTEDLY THERE WAS ENOUGH AND MORE TIME FOR THE ASSESSEE TO SUBMIT THE ACCOUNTS DURING ASSESSMENT PROCEEDINGS WHICH FA CT HAS BEEN TAKEN NOTE OF AND CONCURRED BY THE LD. CIT(A). THEREAFTER , THE LD. AR DREW OUR ATTENTION TO THE DEFINITION OF UNDISCLOSED INCOME G IVEN UNDER SECTION 271AAB WHICH READS AS UNDER: PENALTY WHERE SEARCH HAS BEEN INITIATED. '271AAB. (1) THE ASSESSING OFFICER MAY, NOTWITHSTAN DING ANYTHING CONTAINED IN ANY OTHER PROVISIONS OF THIS ACT, DIRECT THAT, IN A CASE WHERE SEARCH HAS BEEN INITIATED UNDER SECTION 132 ON OR AFTER THE 1S T DAY OF JULY, 2012, THE ASSESSEE SHALL PAY BY WAY OF PENALTY, IN ADDITION T O TAX, IF ANY, PAYABLE BY HIM, (A) A SUM COMPUTED AT THE RATE OF TEN PER CENT OF T HE UNDISCLOSED INCOME OF THE SPECIFIED PREVIOUS YEAR, IF SUCH ASSESSEE ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 30 ******** EXPLANATION FOR THE PURPOSES OF THIS SECTION, - (A) . (B) . (C) 'UNDISCLOSED INCOME' MEANS (I) ANY INCOME OF THE SPECIFIED PREVIOUS YEAR REPR ESENTED, EITHER WHOLLY OR PARTLY, BY ANY MONEY, BULLION, JEWELLERY OR OTHE R VALUABLE ARTICLE OR THING OR ANY ENTRY IN THE BOOKS OF ACCOUNT OR OT HER DOCUMENTS OR TRANSACTIONS FOUND IN THE COURSE OF A SEARCH UNDER SECTION 132, WHICH HAS (A) NOT BEEN RECORDED ON OR BEFORE THE DATE OF SEA RCH IN THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS MAINTAINED IN THE NOR MAL COURSE RELATING TO SUCH PREVIOUS YEAR; OR (B) OTHERWISE NOT BEEN DISCLOSED TO THE [PRINCIPAL CHIEF COMMISSIONER OR] CHIEF COMMISSIONER OR [PRINCIPAL COMMISSIONER OR] COMMISSIONER BEFORE THE DATE OF SE ARCH; OR (II) ANY INCOME OF THE SPECIFIED PREVIOUS YEAR REPR ESENTED, EITHER WHOLLY OR PARTLY, BY ANY ENTRY IN RESPECT OF AN EXP ENSE RECORDED IN THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS MAINTAINED IN THE NORMAL COURSE RELATING TO THE SPECIFIED PREVIOUS YEAR WHIC H IS FOUND TO BE FALSE AND WOULD NOT HAVE BEEN FOUND TO BE SO HAD TH E SEARCH NOT BEEN CONDUCTED. ACCORDING TO THE LD. AR, FROM THE FACTS AND CIRCUMS TANCES DESCRIBED ABOVE, SINCE THE ASSESSEE IS NOT ENGAGED IN BUSINES S OR PROFESSION, HE DOES NOT REQUIRE TO MAINTAIN THE BOOKS OF ACCOUNT A S PER SEC. 44AA OR SEC. 44AA(2) OF THE ACT, THEREFORE, THE ASSESSEES CASE FALLS IN THE SECOND LIMB I.E. OR OTHER DOCUMENTS AS STIPULATED U/S. 2 71AAB EXPLANATION (C) (SUPRA) WHICH DESCRIBES UNDISCLOSED INCOME FOR THE PURPOSES OF THIS SECTION WHICH IS VERY IMPORTANT TO ADJUDICATE THIS ISSUE. THEREFORE, THE QUESTION IS WHEN THE SEARCH TOOK PLACE, THE ASSESSE ES TRANSACTIONS (IN THIS CASE, THE SPECULATIVE TRANSACTION) HAS BEEN FO UND TO BE RECORDED IN THE OTHER DOCUMENTS WHICH IS (RETRIEVED FROM THE ASSESSEES ACCOUNTANTS DRAWER) AND BASED ON THAT THE ASSESSEE DECLARED RS. 3 CR. DURING SEARCH AND LATER RETURNED INCOME OF RS. 3 CR . AS INCOME UNDER THE HEAD INCOME FROM OTHER SOURCES WHICH WAS ACCEPTED BY THE AO IN TOTO. WE NOTE THAT SINCE THE INCOME UNDER QUESTION (RS. 3 CR.) WAS IN FACT ENTERED IN THE OTHER DOCUMENTS MAINTAINED IN THE NORMAL COURSE RELATING ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 31 TO THE AY 2013-14, WHICH DOCUMENT WAS RETRIEVED DUR ING SEARCH, HENCE, THE AMOUNT OF RS. 3 CR. OFFERED BY THE ASSESSEE DOES NOT FALL IN THE KEN OF UNDISCLOS ED INCOME DEFINED IN SEC. 271AAB OF THE ACT. SO, RS. 3 CR. WHICH WAS COM MODITY PROFIT RECORDED IN THE OTHER DOCUMENT MAINTAINED BY THE AS SESSEE WHICH WAS RETRIEVED DURING SEARCH CANNOT BE TERMED AS UNDISC LOSED INCOME IN THE DEFINITION GIVEN U/S. 271AAB OF THE ACT. SINCE RS. 3 CR. CANNOT BE TERMED AS UNDISCLOSED INCOME AS PER SEC. 271AAB OF THE A CT, NO PENALTY CAN BE LEVIED AGAINST THE ASSESSEE. THEREFORE, WE UPHOL D THE ORDER OF THE LD. CIT(A) ON THE AFORESAID REASONING RENDERED BY US. 8. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. 4. WE FIND THAT THE FACTS IN THE AFORESAID CASE AN D THE DECISION RENDERED THEREON ARE SQUARELY APPLICABLE TO THE FAC TS OF THE INSTANT CASES BEFORE US AND RESPECTFULLY FOLLOWING THE SAME , WE DISMISS THE APPEALS OF THE REVENUE. THEREFORE, WHEN THE ASSESSEE IS NOT REQUIRED TO MAI NTAIN THE BOOKS OF ACCOUNT AS PER SECTION 44AA, THEN THE MATTER IS REQ UIRED TO BE EXAMINED WHETHER THE ALLEGED UNDISCLOSED INCOME IS RECORDED IN THE OTHER DOCUMENTS MAINTAINED IN THE NORMAL COURSE AS PER CLAUSE (C) TO EXPLANATION TO SECTION 271AAB. UNDISPUTEDLY THE AL LEGED INCOME WAS FOUND RECORDED IN THE DIARY WHICH IS NOTHING BUT THE OTHER RECORD MAINTAINED IN THE NORMAL COURSE, THUS THE SAME WOUL D NOT FALL IN THE DEFINITION OF UNDISCLOSED INCOME. ONCE THE SAID IN COME IS FOUND AS RECORDED IN THE OTHER DOCUMENTS MAINTAINED IN THE N ORMAL COURSE, THEN IT CANNOT BE PRESUMED THAT THE ASSESSEE WOULD NOT HAVE DISCLOSED THE SAME IN THE RETURN OF INCOME TO BE FILED AFTER ABOUT ONE YEAR FROM THE DATE OF SEARCH. HENCE, IN VIEW OF THE ABOVE FAC TS AND CIRCUMSTANCES OF THE CASE AS WELL AS THE VARIOUS DE CISIONS ON THIS POINT, WE HOLD THAT THE PENALTY LEVIED UNDER SECTION 271AA B IS NOT SUSTAINABLE AND THE SAME IS DELETED. IN VIEW OF THE ABOVE DISCUSSION AND FOLLOWING THE D ECISION OF THE TRIBUNAL IN CASE OF RAVI MATHUR VS. DCIT (SUPRA), W E DELETE THE PENALTY LEVIED BY THE AO UNDER SECTION 271AAB OF THE ACT. ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 32 SO FAR AS THE PENALTY U/S 271AAB IS CONCERNED, THE AO HAS TO TAKE THE DECISION AFTER CONSIDERING THE EXPLANATION OF THE A SSESSEE AND BASED ON THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS BY CONSIDERING THE SATISFACTION OF THE CONDITIONS AS PROVIDED U/S 271A AB OF THE ACT. THE TRIBUNAL HAS HELD THAT LEVY OF PENALTY U/S 271AAB O F THE ACT IS NOT MANDATORY BUT THE AO HAS DISCRETION TO TAKE THE DEC ISION AND THE SAME SHALL BE BASED ON JUDICIOUS DECISION OF THE AO. THE REFORE, THE AO IS REQUIRED TO FIRST EXAMINE THE FACTS AND CIRCUMSTA NCES UNDER WHICH THE ASSESSEE SURRENDERED THE INCOME AS WELL AS THE SEIZ ED MATERIAL TO ARRIVE AT A CONCLUSION THAT THE INCOME SO DISCLOSED BY THE AS SESSEE DURING THE COURSE OF SEARCH AND SEIZURE PROCEEDINGS FALLS IN T HE DEFINITION OF UNDISCLOSED INCOME AS PROVIDED IN THE EXPLANATION TO SECTION 271AAB OF THE ACT. THE DEFINITION OF UNDISCLOSED INCOME PROVI DED IN CLAUSE (C ) OF EXPLANATION TO SECTION 271AAB ACT CONTEMPLATES ANY INCOME REPRESENTED BY ANY MONEY, BULLION, OR OTHER VALUABL E ARTICLE OR THING OR ANY ENTRY IN THE BOOKS OF ACCOUNT OR OTHER DOCUMENT S OR TRANSACTIONS FOUND IN THE COURSE OF SEARCH U/S 132 OF THE ACT WH ICH HAS NOT BEEN RECORDED IN THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS MAINTAINED IN NORMAL COURSE ON OR BEFORE THE DATE OF SEARCH. IF T HE DEFINITION OF ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 33 UNDISCLOSED INCOME PROVIDED UNDER EXPLANATION TO SE CTION 271AAB IS APPLIED TO THE FACTS OF THE PRESENT CASE, WE FIND T HE SEIZED DOCUMENTS WHICH IS PLAN AND MAP OF A RESIDENTIAL HOUSE IN THE NAME OF ASSESSEE'S WIFE SMT. USHA JAIN CONTAINING ONLY THE DESIGN OF T HE HOUSE AS WELL AS ELECTRIC PLAN. THEREFORE, THE SAID SEIZED DOCUMENTS ITSELF DOES NOT REVEAL ANY UNDISCLOSED INCOME OR ANY OTHER UNACCOUNTED EXP ENDITURE BUT IT IS A ELECTRIC PLAN WHICH MEANS THAT HOUSE WAS TO BE CONS TRUCTED AS PER THE SAID PLAN WHETHER THE SAID WORK AS GIVEN IN THE PLAN AND DESIGN HAS BEEN ACTUALLY CARRIED OUT OR NOT, WAS NOT THE SUBJECT MA TTER OF THE SEARCH AND SEIZURE ACTION. THE SAID SEIZED DOCUMENTS ALSO DO N OT REVEAL THE ACTUAL EXPENDITURE OR TENTATIVE EXPENDITURE FOR CARRYING O UT THE ELECTRIC WORK AS PER PLAN. THUS THE SAID SEIZED DOCUMENTS IN THE ABS ENCE OF ANY OTHER MATERIALS REVEALING THE UNEXPLAINED EXPENDITURE CAN NOT BE SAID TO BE AN INCRIMINATING MATERIALS. THE SEARCHED PARTY HAS NOT MADE ANY ALLEGATION ABOUT THE ACTUAL EXPENDITURE INCURRED BY THE ASSESS EE IN THE CONSTRUCTION OF RESIDENTIAL HOUSE, IF ANY. THERE IS NOTHING EITH ER IN THE PROCEEDINGS U/S 132 OR IN THE STATEMENT RECORDED U/S 132(4) OF THE ACT REGARDING UNACCOUNTED EXPENDITURE INCURRED BY THE ASSESSEE ON CONSTRUCTION OF HOUSE. FURTHER, THERE IS NO MENTION OF THE ACTUAL C ONSTRUCTION OF THE HOUSE ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 34 BY THE ASSESSEE OR THE TIMING THE CONSTRUCTION PERI OD OR COMPLETION OF CONSTRUCTION WORK. EVEN THE ALLEGED EXPENDITURE NOT RECORDED IN THE BOOKS OF ACCOUNT IS NOT BASED ON ANY DOCUMENTARY EV IDENCE OR EVEN ON PHYSICAL VERIFICATION OF THE ELECTRICAL ITEMS AS WE LL AS FURNITURE AND FIXTURE INSTALLED IN THE HOUSE OF THE ASSESSEE. WHE N THE SAID INCOME IS NOT REPRESENTED BY ANY MONEY, BULLION, JEWELLERY OR OTH ER VALUABLE ARTICLE OR THING OR ANY ENTRY IN THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS OR TRANSACTIONS THEN EVEN IF THE ASSESSEE HAS SURRENDE RED A SUM OF RS. 10.00 LACS AS UNACCOUNTED EXPENDITURE, THE SAME WOULD NOT FALL IN THE AMBIT OF UNDISCLOSED INCOME AS DEFINED IN EXPLANATION TO SEC TION 271AAB OF THE ACT. A BARE SURRENDER OF INCOME NOT REPRESENTING TH E MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING OR ANY ENTRY IN THE BOOKS OF ACCOUNT WILL NOT BE REGARDED AS UNDISCLOSED INCOME FOR THE PURPOSE OF LEVY OF PENALTY U/S 271AAB OF THE ACT. IN THE CASE IN HAND, IT IS CLEAR FROM THE RECORDS THAT THE ASSESSEE IN HIS STATEMENT RECORDED U/S 132(4) OF THE ACT HAS MADE A SURRENDER OF RS. 10.00 LACS BASE D ON SAID SEIZED MATERIALS MARKED AS ANNEXURE A-2 PAGE 60 TO 62 WHIC H IS ELECTRIC PLAN AND SITE MAP OF THE HOUSE. THEREFORE, IN THE ABSENC E OF ANY UNDISCLOSED INCOME REVEALED BY SAID SIZED MATERIALS, THE INCOME SURRENDERED BY THE ITA NO.1129/JP/2019 SHRI AESHWARYA JAIN VS DCIT, CENTRAL CIRCL E, KOTA 35 ASSESSEE CANNOT BE SAID TO BE UNDISCLOSED INCOME FO R THE PURPOSE OF SECTION 271AAB OF THE ACT. HENCE, IN THE FACTS AND CIRCUMSTANCES OF THE CASE WHEN INCOME SURRENDERED BY THE ASSESSEE DOES N OT FALL IN THE AMBIT OF UNDISCLOSED INCOME AS DEFINED IN SECTION 271AAB OF THE ACT, THE SAME WOULD NOT ATTRACT THE LEVY OF PENALTY U/S 271A AB OF THE ACT. ACCORDINGLY, THE PENALTY LEVIED BY THE AO IS DELETE D. 3.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 07 /01/ 2020. SD/- SD/- FOE FLAG ;KNO FOT; IKY JKO (VIKRAM SINGH YADAV) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 07/01/ 2020 *MISHRA VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI AESHWARYA JAIN, KOTA 2. IZR;FKHZ@ THE RESPONDENT- THE DCIT, CENTRAL CIRCLE,KOTA 3. VK;DJ VK;QDRVIHY ) @ CIT(A), 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO.1129/JP/2019) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR