M/s. Narsi Iron and Steel Pvt. Ltd., Uttar Pradesh V. DCIT, New Delhi

ITA 3547/DEL/2015

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 6195 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 7 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-01-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: I
• Assessment Year: 2009-2010
• Appeal Filed On: 02-06-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AJIT KUMAR JHA ADVOCA
• Assessee Lawyers: S S RANA
• Keywords: Business income; Income from undisclosed sources; Search and seizure; Document seized; Question of law; Documents seized
• Section: 271(1)(c); 5(2); 133A; 153A; 27; 132; 139

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL, DELHI BENCH E, NEW DELHI BEFORE : SHRI AMIT SHUKLA, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACCOUNTANT MEMBER ITA NO. 3547/DEL./2015 ASSESSMENT YEAR: 2009-10 M/S. NARSI IRON & STEEL PVT. LTD. S - 1, INDUSTRIAL AREA SITE-A, MATHURA (U.P.) (PAN : AAACN3681P) (APPELLANT) VS. D.C.I.T., CENTRAL CIRCLE - 5 NEW DELHI (RESPONDENT) APPELLANT BY SHRI S.S. RANA, CIT/DR RESPONDENT BY SHRI RAJIV SAXENA, ADVOCATE AND SHRI AJIT KUMAR JHA, ADVOCATE ORDER PER L.P. SAHU, A.M.: THIS APPEAL BY THE ASSESSEE ARISES OUT OF THE ORDE R PASSED BY THE CIT(A)-24, NEW DELHI DATED 24.03.2015 IN RELATION T O ASSESSMENT YEAR 2009- 10, CHALLENGING THE CONFIRMATION OF PENALTY IMPOSED U/S. 271-AAA OF THE IT ACT. 2. BRIEFLY STATED THE FACTS RELEVANT TO ADJUDICATE THE ISSUES INVOLVED IN THIS APPEAL ARE THAT A SEARCH AND SEIZURE OPERATION WAS CARRIED OUT AT THE PREMISES OF ASSESSEE ALONG WITH OTHER CASES OF RAJDARBAR GRO UP ON 31.07.2008. PURSUANT TO THE NOTICE U/S. 153A OF THE, THE ASSESS EE FILED ITS RETURN OF INCOME ON 05.08.2010 DECLARING INCOME OF RS.1,07,66,230/- INCLUDING RS.90.00 SURRENDERED BY WAY OF LETTER DATED 26.09.2008 ADDRE SSED TO DIT (INV.), WHICH IS PLACED AT PAGE 20 OF THE PAPER BOOK. THIS SURREN DER WAS MADE PARTLY ON DATE OF HEARING 05.12.2018 DATE OF PRONOUNCEMENT 28.01.2019 ITA NO. 3547/DEL/2015 2 ACCOUNT OF UNEXPLAINED CONSTRUCTION IN THE PROJECT, NAMED KUSUM VATIKA AND PARTLY ON ACCOUNT OF DIFFERENCE IN STOCK AS NOTED B Y THE ASSESSING OFFICER. THE ASSESSEE HAD ALSO DISCLOSED RS.90 LAKHS SEPARATELY IN THE PROFIT AND LOSS ACCOUNT OF KUSUM VATIKA. THE SURRENDER OF UNDISCLOS ED INCOME SO MADE BY THE ASSESSEE WAS ACCEPTED BY THE ASSESSING OFFICER. THE ASSESSING OFFICER, THEREAFTER, INITIATED PROCEEDINGS U/S. 271AAA AND I MPOSED A PENALTY OF RS.9 LACS EQUAL TO 10% OF SUCH SURRENDERED UNDISCLOSED I NCOME, ON THE PREMISE THAT THE ASSESSEE DID NOT SPECIFY THE MANNER IN WHI CH THE SAID UNDISCLOSED SURRENDERED INCOME WAS DERIVED BY THE ASSESSEE. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A) WHO AFFIRMED THE PENALTY IMPOSED BY THE ASSESSING OFFICER. AGGRIEVED BY THE IMPUGNED OR DER, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 3. THE LD. AR OF THE ASSESSEE REITERATING THE SUBMI SSIONS MADE BEFORE THE LD. AUTHORITIES BELOW SUBMITTED THAT NO SURRENDER W AS MADE IN THE STATEMENTS RECORDED U/S. 132(4) OF THE ACT; THAT THE SURRENDER SO MADE WAS VOLUNTARY TO PURCHASE PEACE OF MIND AND TO AVOID FURTHER LITIGAT ION WITH CONDITION THAT NO PENAL ACTION SHALL BE TAKEN AGAINST THE ASSESSEE; T HAT NO QUERIES WERE MADE BY THE SEARCH PARTY AS TO THE MANNER IN WHICH THE SURR ENDERED AMOUNT WAS EARNED BY THE ASSESSEE; THAT THE APPELLANT HAD ADMI TTED THE SURRENDERED INCOME IN ITS RETURN AND HAS PAID TAX THEREON; AND THAT THE AMOUNT OF RS.90,00,000/- SURRENDERED IS INCLUDED IN THE TOTAL SURRENDER OF RS.9,11,45,950/- IN THE GROUP CASE OF RAKESH KUMAR GARG AND THE SAME HAS BEEN CONSIDERED IN THAT CASE. THEREFORE, THE CONDI TIONS SPECIFIED FOR IMMUNITY OF PENALTY STOOD SATISFIED BY THE APPELLANT AND THE LD. AUTHORITIES BELOW WERE NOT JUSTIFIED TO IMPOSE PENALTY U/S. 271AAA OF THE ACT. IT WAS NEXT SUBMITTED ITA NO. 3547/DEL/2015 3 THAT IN OTHER GROUP CASES OF ASSESSEE, SIMILAR PENA LTIES HAVE BEEN DELETED BY THE TRIBUNAL AND HIGH COURT. RELIANCE IS PLACED ON THE FOLLOWING DECISIONS : (I). NARENDRA KUMAR AGARWAL VS. DCIT (ITA NO. 4107/ DEL/2014) & OTHERS. (II). RAKESH KUMAR GARG VS. DCIT (ITA NO. 673/DEL /2014) (III). M/S. EMIRATES TECHNOLOGIES PVT. LTD. (ITA N O. 400/2017 DELHI HIGH COURT) (IV). SANDEEP GUPTA VS. PR. CIT (ITA NO. 967/2017- DELHI H.C.) (V). SANTOSH KUMAR GARG VS. DCIT (ITA NO. 267/DEL/ 2014). 4. ON THE OTHER HAND, THE LD. DR RELIED ON THE ORDE RS OF THE AUTHORITIES BELOW AND SUBMITTED THAT THE SURRENDER OF UNDISCLOS ED INCOME WAS MADE IN VIEW OF VARIOUS DISCREPANCIES FOUND IN THE COURSE O F SEARCH VIDE LETTER DATED 26.09.2008 BEFORE THE INVESTIGATION WING AND NOT BE FORE THE ASSESSING OFFICER IN THE ASSESSMENT PROCEEDINGS. SINCE THE ASSESSEE F AILED TO SPECIFY THE MANNER IN WHICH THE UNDISCLOSED INCOME SURRENDERED BY HIM WAS EARNED, THE LD. AUTHORITIES BELOW WERE JUSTIFIED TO HOLD THAT THE C ONDITIONS ENVISAGED FOR IMMUNITY FROM PENALTY U/S. 271-AAA OF THE ACT DID N OT STAND SATISFIED BY THE ASSESSEE. RELIANCE IF PLACED ON THE LATEST DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF PR. CIT VS. SMT. RITU SIN GAL (2018) 92 TAXMANN.COM 224(DEL) DATED MARCH 12, 2018. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND HAV E GONE THROUGH THE ENTIRE MATERIAL AVAILABLE ON RECORD AND WE FIND THA T NO DOUBT THE TRIBUNAL IN VARIOUS CASES AS CITED BY THE ASSESSEE HAS DELETED SIMILAR PENALTY IMPOSED U/S. 271AAA OF THE ACT, BUT WE FIND COMPLETE ANSWER OF A SSESSEES ALL THE CONTENTIONS MADE BEFORE US IN THE LATEST DECISION O F HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF PR. CIT VS. SMT. RITU SIN GAL (SUPRA) RELIED BY THE LD. ITA NO. 3547/DEL/2015 4 DR, WHEREIN THE HONBLE COURT WHILE DECIDING THE IS SUE IN THE LIGHT OF PROVISIONS OF SECTION 271AAA OF THE ACT HAS HELD AS UNDER : ANALYSIS AND CONCLUSIONS 7. SECTION 271AAA, WHICH IS INVOLVED IN THE PRESENT C ASE, READS AS FOLLOWS: 'PENALTY WHERE SEARCH HAS BEEN INITIATED. 271AAA. (1) THE ASSESSING OFFICER MAY, NOTWITHSTAND ING ANYTHING CONTAINED IN ANY OTHER PROVISIONS OF THIS ACT, DIRECT THAT, IN A CAS E WHERE SEARCH HAS BEEN INITIATED UNDER SECTION 132 ON OR AFTER THE 1ST DAY OF JUNE, 2007 B UT BEFORE THE 1ST DAY OF JULY, 2012, THE ASSESSEE SHALL PAY BY WAY OF PENALTY, IN ADDITI ON TO TAX, IF ANY, PAYABLE BY HIM, A SUM COMPUTED AT THE RATE OF TEN PER CENT OF THE UND ISCLOSED INCOME OF THE SPECIFIED PREVIOUS YEAR. (2) NOTHING CONTAINED IN SUB-SECTION (1) SHALL APPL Y 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 MAN NER IN WHICH SUCH INCOME HAS BEEN DERIVED; ( II ) SUBSTANTIATES THE MANNER IN WHICH THE UNDISCLOSED I NCOME WAS DERIVED; AND ( III ) PAYS THE TAX, TOGETHER WITH INTEREST, IF ANY, IN RE SPECT OF THE UNDISCLOSED INCOME. (3) 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). (4) THE PROVISIONS OF SECTIONS 274 AND 275 SHALL, S O FAR AS MAY BE, APPLY IN RELATION TO THE PENALTY REFERRED TO IN THIS SECTION. EXPLANATION .FOR THE PURPOSES OF THIS SECTION, ( A ) 'UNDISCLOSED INCOME' MEANS ( I ) ANY INCOME OF THE SPECIFIED PREVIOUS YEAR REPRESENT ED, EITHER WHOLLY OR PARTLY, BY ANY MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING OR ANY ENTRY IN THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS OR TRANS ACTIONS 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 THE NORMAL COURSE REL ATING TO SUCH PREVIOUS YEAR; OR (B) OTHERWISE NOT BEEN DISCLOSED TO THE PRINCIPAL CHIEF COMMISSIONER OR CHIEF COMMISSIONER OR PRINCIPAL COMMISSIONER OR COMMISSIO NER BEFORE THE DATE OF SEARCH; OR ITA NO. 3547/DEL/2015 5 ( II ) ANY I NCOME OF THE SPECIFIED PREVIOUS YEAR REPRESENTED, E ITHER WHOLLY OR PARTLY, BY ANY ENTRY IN RESPECT OF AN EXPENSE RECORDED IN T HE BOOKS OF ACCOUNT OR OTHER DOCUMENTS MAINTAINED IN THE NORMAL COURSE RELATING TO THE SPECIFIED PREVIOUS YEAR WHICH IS FOUND TO BE FALSE AND WOULD NOT HAVE BEEN FOUND TO BE SO HAD THE SEARCH NOT BEEN CONDUCTED; ( B ) 'SPECIFIED PREVIOUS YEAR' MEANS THE PREVIOUS YEAR ( I ) WHICH HAS ENDED BEFORE THE DATE OF SEARCH, BUT THE DATE OF FILING THE RETURN OF INCOME UNDER SUB-SECTION (1) OF SECTION 139 FOR SUC H YEAR HAS NOT EXPIRED BEFORE THE DATE OF SEARCH AND THE ASSESSEE HAS NOT FURNISHED THE RETURN OF INCOME FOR THE PREVIOUS YEAR BEFORE THE SAID DATE; OR ( II ) IN WHICH SEARCH WAS CONDUCTED.' 8. THIS PROVISION WAS BROUGHT INTO FORCE WITH EFFECT FROM 01-04-2007. ITS SCOPE AND EFFECT WAS EXPLAINED BY CIRCULAR OF THE CENTRAL BOARD OF D IRECT TAXES (CBDT) DATED 12-03-2008 (CIRCULAR NO.3) IN THE FOLLOWING TERMS: '68. PROVISION FOR PENALTY FOR CONCEALMENT IN SEARC H AND SEIZURE CASES.-68.1 A NEW SECTION 271AAA HAS ALSO BEEN INSERTED SO AS TO PROV IDE THAT, IN A CASE WHERE SEARCH HAS BEEN INITIATED UNDER SECTION 132 ON OR AFTER 1ST JU NE, 2007, THE ASSESSEE SHALL BE LIABLE TO PAY BY WAY OF PENALTY, IN ADDITION TO TAX, IF AN Y, PAYABLE BY HIM, A SUM COMPUTED AT THE RATE OF TEN PER CENT OF THE UNDISCLOSED INCOME OF THE SPECIFIED PREVIOUS YEAR. HOWEVER, PROVISIONS OF THIS SECTION SHALL NOT BE AP PLICABLE IF THE ASSESSEE- (I) IN A STATEMENT UNDER SUB-SECTION (4) OF SECTION132 IN TH E COURSE OF THE SEARCH, ADMITS THE UNDISCLOSED INCOME AND SPECIFIES THE MANNER IN WHIC H SUCH INCOME HAS BEEN DERIVED; (II) SUBSTANTIATES THE MANNER IN WHICH THE UNDISCLO SED INCOME WAS DERIVED; AND (III) PAYS THE TAX, TOGETHER WITH INTEREST, IF ANY, IN RE SPECT OF THE UNDISCLOSED INCOME. IT IS FURTHER PROVIDED THAT NO PENALTY UNDER THE PROVISIO NS OF CLAUSE (C) OF SUB-SECTION (1) OF SECTION 271 SHALL BE LEVIED OR IMPOSED UPON THE ASS ESSEE IN RESPECT OF THE UNDISCLOSED INCOME REFERRED TO IN THIS SECTION. IT IS ALSO PROV IDED THAT THE PROVISIONS OF SECTION 274 AND SECTION 275 SHALL, SO FAR AS MAY BE, APPLY IN R ELATION TO THE PENALTY LEVIABLE UNDER THE NEW SECTION. 68.2 FOR THE PURPOSES OF THIS SECTION, UNDISCLOSED INCOME HAS BEEN DEFINED TO MEAN- (I) ANY INCOME OF THE SPECIFIED PREVIOUS YEARS REPRESEN TED, EITHER WHOLLY OR PARTLY, BY ANY MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING OR ANY ENTRY IN THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS OR TRANSACTIONS FOUND IN THE COURSE OF A SEARCH UNDER SECTION 132, WHICH HAS NOT BEEN RECORDED ON OR BEFO RE THE DATE OF SEARCH IN THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS MAINTAINED IN THE NOR MAL COURSE RELATING TO SUCH PREVIOUS YEAR; OR WHICH HAS OTHERWISE NOT BEEN DISC LOSED TO THE CHIEF COMMISSIONER OR COMMISSIONER BEFORE THE DATE OF THE SEARCH; OR (II) ANY INCOME OF THE SPECIFIED PREVIOUS YEAR REPRESENTED, EITHER WHOLLY OR PARTLY, BY ANY ENTRY IN RESPECT OF AN EXPENSE RECORDED IN THE BOOKS OF ACCOUNT OR OTHER D OCUMENTS MAINTAINED IN THE NORMAL COURSE RELATING TO THE SPECIFIED PREVIOUS YE AR WHICH IS FOUND TO BE FALSE AND WOULD NOT HAVE BEEN FOUND TO BE SO HAD THE SEARCH N OT BEEN CONDUCTED. ITA NO. 3547/DEL/2015 6 68.3 FOR THE PURPOSES OF THIS SECTION, SPECIFIED PR EVIOUS YEAR HAS BEEN DEFINED, SO AS TO MEAN THE PREVIOUS YEAR ( I ) WHICH HAS ENDED BEFORE THE DATE OF SEARCH, BUT TH E DATE OF FILING THE RETURN OF INCOME UNDER SUB-SECTION (1) OF SECTION 139 FOR SUC H YEAR HAS NOT EXPIRED BEFORE THE DATE OF SEARCH AND THE ASSESSEE HAS NOT FURNISHED T HE RETURN OF INCOME FOR THE PREVIOUS YEAR BEFORE THE SAID DATE; OR ( II ) IN WHICH SEARCH WAS CONDUCTED. 68.4 AN APPEAL TO THE COMMISSIONER AGAINST LEVY OF PENALTY UNDER THE PROPOSED NEW SECTION 271AAA HAS ALSO BEEN PROVIDED. 68.5 APPLICABILITY- THIS AMENDMENT WILL TAKE EFFECT FROM THE 1ST DAY OF JUNE, 2007 AND WILL ACCORDINGLY APPLY IN RELATION TO ASSESSMENT YE AR 2007-2008 AND SUBSEQUENT YEARS IN CASES WHERE SEARCH UNDER SECTION 132 IS INITIATE D ON OR AFTER 1ST JUNE, 2007.' 9. SECTION 271AAA WAS AMENDED BY THE FINANCE ACT, 201 2 WITH EFFECT FROM 01-04-2012. THE EFFECT OF THE AMENDMENT WAS THAT IT BECAME APPL ICABLE IN ALL CASES WHERE SEARCH WAS INITIATED UNDER SECTION 132 ON OR AFTER 01-06-2007 BUT BEFORE 01-07-2012.SECTION 271AAA AND ITS AMENDMENTS ARE PART OF SERIES OF AMENDMENTS WITH RESPECT TO THE EFFECT OF PRESUMPTION IN THE CASE OF SEARCH CASES UNDER SECTI ON 132(4A). THESE WERE INTRODUCED SIMULTANEOUSLY WITH THE OMISSION OF EXPLANATION 5 T O SECTION 271(1)(C) ON THE ONE HAND AND INSERTION OF EXPLANATION 5A AS WELL AS SECTION 292C. THE PROVISION APPLIES TO INCOME OF THE SPECIFIED PERIOD, I.E. PERIOD FOR WHICH RETURN HAD NOT YET BECOME DUE AND THE BROKEN PERIODS STARTING FROM THE BEGINNING OF THE FINANCIA L YEARS TILL THE DATE OF THE SEARCH. IT PROVIDES FOR 10% PENALTY OF SUCH INCOME THROUGH A S TATUTORY INFERENCE OR PRESUMPTION THAT SUCH AMOUNT OR INCOME WAS NOT INTENDED TO BE D ISCLOSED AS THEY WERE NOT REFLECTED IN THE BOOKS, SOON AT THE TIME OF THE SEARCH. 10. ONE OF THE CONDITIONS THAT RESULTS IN THE INAPPLIC ABILITY OF SECTION 271AA IS PAYMENT OF TAX. SINCE THE ASSESSABILITY AND QUANTIFICATION OF THE AMOUNT OF UNDISCLOSED INCOME CAN BE LEGITIMATELY COMPUTED ONLY AT THE STAGE OF ASSESSME NT, IT WAS HELD BY THE TRIBUNAL CONCURRING WITH THE FIRST APPELLATE AUTHORITY, THAT THE OUTER TIME LIMIT FOR PAYMENT OF TAX IS NOT PRIOR TO THE CONCLUSION OF ASSESSMENT PROCEEDIN GS. WHERE THERE WAS A SHORT PAYMENT BY WAY OF SELF-ASSESSMENT TAX BUT MADE GOOD IN RESP ONSE TO THE NOTICE OF DEMAND ON COMPLETION OF THE ASSESSMENT IT WAS HELD THAT THERE WAS NO SCOPE FOR PENALTY UNDER SECTION 271AAA AS WAS HELD IN MAHENDRA C. SHAH ( SUPRA ) WHILE INTERPRETING EXPLANATION 5 TO SECTION 271(1)(C). 11. EXPLANATION 5(2) OF SECTION 271(1)(C) WAS CONSIDERED BY THE SU PREME COURT IN ASSTT. CIT V. GEBILAL KANHAIALAL [2012] 25 TAXMANN.COM 214/210 TAXMAN 244/348 ITR 56 1 . IT WAS HELD THAT EXPLANATION 5 (2) TO SECTION 271 (1) (C) PROVIDES, WHERE, IN THE COURSE OF SEARCH UNDER SECTION 132, THE ASSESSEE, FOUND TO BE OWNER OF UNACCOUNTED ASSETS, CLAIMS THAT SUCH ASSETS HAVE BEEN ACQUIRED BY HIM BY UTILI ZING, WHOLLY OR PARTLY, HIS INCOME FOR ANY PREVIOUS YEAR WHICH HAS ENDED BEFORE THE DATE OF SE ARCH OR WHICH IS TO END ON OR AFTER THE DATE OF SEARCH, THEN, NOTWITHSTANDING THAT SUCH INC OME IS DECLARED BY HIM IN ANY RETURN OF INCOME FURNISHED ON OR AFTER THE DATE OF SEARCH, HE SHALL BE DEEMED TO HAVE CONCEALED PARTICULARS OF HIS INCOME FOR THE PURPOSE OF IMPOSI TION OF PENALTY, BUT THERE ARE EXCEPTIONS TO SUCH DEEMING PROVISION OR TO SUCH A PRESUMPTION OF CONCEALMENT. THE COURT THEN SAID: ITA NO. 3547/DEL/2015 7 'IT PROVIDES THAT WHERE, IN THE COURSE OF SEARCH UN DER SECTION 132, THE ASSESSEE IS FOUND TO BE THE OWNER OF UNACCOUNTED ASSETS AND THE ASSESSEE CLAIMS THAT SUCH ASSETS HAVE BEEN ACQUIRED BY HIM BY UTILIZING, WHOLLY OR P ARTLY, HIS INCOME FOR ANY PREVIOUS YEAR WHICH HAS ENDED BEFORE THE DATE OF SEARCH OR W HICH IS TO END ON OR AFTER THE DATE OF SEARCH, THEN, IN SUCH A SITUATION, NOTWITHSTANDI NG THAT SUCH INCOME IS DECLARED BY HIM IN ANY RETURN OF INCOME FURNISHED ON OR AFTER T HE DATE OF SEARCH, HE SHALL BE DEEMED TO HAVE CONCEALED THE PARTICULARS OF HIS INC OME FOR THE PURPOSES OF IMPOSITION OF PENALTY UNDER SECTION 271(1)(C). THE ONLY EXCEPT IONS TO SUCH A DEEMING PROVISION OR TO SUCH A PRESUMPTION OF CONCEALMENT ARE GIVEN I N SUB-CLAUSES (1) AND (2) OF EXPLN. 5. IN THIS CASE, WE ARE CONCERNED WITH INTERPRETATI ON OF CLAUSE (2) OF EXPLN. 5, WHICH HAS BEEN QUOTED ABOVE. THREE CONDITIONS HAVE GOT TO BE SATISFIED BY THE ASSESSEE FOR CLAIMING IMMUNITY FROM PAYMENT OF PENALTY UNDER CLA USE (2) OF EXPLN. 5 TO SECTION 271(1)(C).THE FIRST CONDITION WAS THAT THE ASSESSEE MUST MAKE A STATEMENT UNDER SECTION 132(4) IN THE COURSE OF SEARCH STATING THAT THE UNACCOUNTED ASSETS AND INCRIMINATING DOCUMENTS FOUND FROM HIS POSSESSION D URING THE SEARCH HAVE BEEN ACQUIRED OUT OF HIS INCOME, WHICH HAS NOT BEEN DISC LOSED IN THE RETURN OF INCOME TO BE FURNISHED BEFORE EXPIRY OF TIME SPECIFIED IN SECTIO N 139(1). SUCH STATEMENT WAS MADE BY THE KARTA DURING THE SEARCH WHICH CONCLUDED ON 1 -8-1987. IT IS NOT IN DISPUTE THAT CONDITION NO. 1 WAS FULFILLED. THE SECOND CONDITION FOR AVAILING OF THE IMMUNITY FROM PENALTY UNDER SECTION 271(1)(C) WAS THAT THE ASSESS EE SHOULD SPECIFY, IN HIS STATEMENT UNDER SECTION 132(4), THE MANNER IN WHICH SUCH INCO ME STOOD DERIVED. ADMITTEDLY, THE SECOND CONDITION, IN THE PRESENT CASE ALSO STOOD SA TISFIED. ACCORDING TO THE DEPARTMENT, THE ASSESSEE WAS NOT ENTITLED TO IMMUNITY UNDER CLA USE (2) AS HE DID NOT SATISFY THE THIRD CONDITION FOR AVAILING THE BENEFIT OF WAIVER OF PENALTY UNDER SECTION 271(1)(C) AS THE ASSESSEE FAILED TO FILE HIS RETURN OF INCOME ON JULY 31, 1987, AND PAY TAX THEREON PARTICULARLY WHEN THE ASSESSEE CONCEDED ON AUGUST 1 , 1987 THAT THERE WAS CONCEALMENT OF INCOME. THE THIRD CONDITION UNDER CL AUSE (2) WAS THAT THE ASSESSEE HAD TO PAY THE TAX TOGETHER WITH INTEREST, IF ANY, IN R ESPECT OF SUCH UNDISCLOSED INCOME. HOWEVER, NO TIME LIMIT FOR PAYMENT OF SUCH TAX STOO D PRESCRIBED UNDER CLAUSE (2). THE ONLY REQUIREMENT STIPULATED IN THE THIRD CONDITION WAS FOR THE ASSESSEE TO 'PAY TAX TOGETHER WITH INTEREST'. IN THE PRESENT CASE, THE T HIRD CONDITION ALSO STOOD FULFILLED. THE ASSESSEE HAS PAID TAX WITH INTEREST UP TO THE DATE OF PAYMENT. THE ONLY CONDITION WHICH WAS REQUIRED TO BE FULFILLED FOR GETTING THE IMMUNI TY, AFTER THE SEARCH PROCEEDINGS GOT OVER, WAS THAT THE ASSESSEE HAD TO PAY THE TAX TOGE THER WITH INTEREST IN RESPECT OF SUCH UNDISCLOSED INCOME UP TO THE DATE OF PAYMENT. CLAUS E (2) DID NOT PRESCRIBE THE TIME LIMIT WITHIN WHICH THE ASSESSEE SHOULD PAY TAX ON I NCOME DISCLOSED IN THE STATEMENT UNDER SECTION 132(4). FOR THE ABOVE REASONS, WE HOL D THAT THE ASSESSEE WAS ENTITLED TO IMMUNITY UNDER CLAUSE (2) OF EXPLN. 5 TO SECTION 27 1 (1)(C).' 12. LIKE IN THAT CASE, THE FIRST CONDITION UNDER SECTI ON 271AAA IS THAT THE ASSESSEE MUST MAKE A STATEMENT UNDER SECTION 132(4) IN THE COURSE OF SEARCH STATING THAT THE UNACCOUNTED ASSETS AND INCRIMINATING DOCUMENTS FOUN D FROM HIS POSSESSION DURING THE SEARCH HAVE BEEN ACQUIRED OUT OF HIS INCOME, WHICH HAS NOT BEEN DISCLOSED IN THE RETURN OF INCOME TO BE FURNISHED BEFORE EXPIRY OF TIME SPECIF IED IN SECTION 139(1). THE SECOND CONDITION FOR AVAILING OF THE IMMUNITY FROM PENALTY UNDER SECTION 271(1)(C) IS THAT THE ASSESSEE SHOULD SPECIFY, IN HIS STATEMENT UNDER SEC TION 132(4), THE MANNER IN WHICH SUCH INCOME STOOD DERIVED. THE REVENUE CONTENDED GEBILAL KANHAIALAL'S CASE ( SUPRA ) THAT THOUGH THE SECOND CONDITION STOOD SATISFIED, THE THIRD CON DITION WAS NOT SOUGHT. IT URGED THAT THE ITA NO. 3547/DEL/2015 8 ASSESSEE WAS NOT ENTITLED TO IMMUNITY UNDER CLAUSE (2) AS HE DID NOT SATISFY THE THIRD CONDITION FOR AVAILING THE BENEFIT OF WAIVER OF PEN ALTY UNDER SECTION 271(1)(C) AS HE FAILED TO FILE HIS RETURN OF INCOME ON 31ST JULY, 1987 AND PAY TAX THEREON PARTICULARLY WHEN THE ASSESSEE CONCEDED ON 1ST AUG., 1987 THAT THERE WAS CONCEALMENT OF INCOME. THE THIRD CONDITION UNDER CLAUSE (2) WAS THAT THE ASSESSEE HA D TO PAY THE TAX TOGETHER WITH INTEREST, IF ANY, IN RESPECT OF SUCH UNDISCLOSED INCOME. THE COURT HELD THAT NO TIME-LIMIT FOR PAYMENT OF SUCH TAX STOOD PRESCRIBED UNDER CLAUSE (2) AND T HAT THE ONLY REQUIREMENT STIPULATED IN THE THIRD CONDITION WAS FOR THE ASSESSEE TO 'PAY TA X TOGETHER WITH INTEREST'. IT WAS HELD IN GEBILAL KANHAIALAL'S CASE ( SUPRA ) THAT THE THIRD CONDITION WAS ALSO FULFILLED AS TH E ASSESSEE PAID TAX WITH INTEREST UPTO THE DATE OF PAYMENT. TH E ONLY CONDITION WHICH WAS REQUIRED TO BE FULFILLED FOR SECURING THE IMMUNITY, AFTER THE S EARCH PROCEEDINGS GOT OVER, WAS THAT THE ASSESSEE HAD TO PAY THE TAX TOGETHER WITH INTEREST IN RESPECT OF SUCH UNDISCLOSED INCOME UPTO THE DATE OF PAYMENT. EXPLANATION 5 (2) DID NOT PRESCRIBE THE TIME-LIMIT WITHIN WHICH THE ASSESSEE SHOULD PAY TAX ON INCOME DISCLOSED IN THE STATEMENT UNDER SECTION 132(4). 13. IN THE PRESENT CASE, DURING THE COURSE OF THE STAT EMENT MADE BY THE ASSESSEE, DURING THE COURSE OF THE SEARCH ON 4 MARCH, 2010, THAT SHE HAD LENT RS.16 CRORES IN AGGREGATE TO THREE INDIVIDUALS DURING FINANCIAL YEAR 2009-2010. THIS WAS IN RESPONSE TO A QUERY BY THE REVENUE OFFICIALS DURING THE COURSE OF SEARCH WHEN THE BASIS OF PAGE 81 OF EXHIBIT A-3 WAS SOUGHT TO BE QUESTIONED. TO THE NEXT QUESTION, THE ASSESSEE REPLIED THAT THE SAID AMOUNT OF RS.16 CRORES IS MY UNACCOUNTED INCOME FOR THE FINAN CIAL YEAR 2009-2010 RELEVANT FOR AY 2010-2011'. HOWEVER, THE REQUIREMENT OF THE ASSESSE E HAVING TO '(II) SUBSTANTIATES THE MANNER IN WHICH THE UNDISCLOSED INCOME WAS DERIVED' WAS SATISFIED. ALTHOUGH A GENERAL STATEMENT THAT THE UNDISCLOSED INCOME WAS THE SOURC E OF RS.16 CRORES WAS DISCLOSED, NO 'SUBSTANTIATION' OF THE 'MANNER' OF DERIVING SUCH U NDISCLOSED INCOME WAS REVEALED. 14. IN CONSTRUING SECTION 271AAA ONE MUST NOT LOSE SIG HT OF ITS ESSENTIAL PURPOSE WHICH RESULTED IN ITS ENACTMENT. THERE IS A PENALTY AT TH E RATE OF 10% OF THE UNDISCLOSED AMOUNT DECLARED, IF THE CONDITIONS IN SECTION 271AAA (2) A RE NOT MET WITH. THIS IS QUITE DIFFERENT FROM THE PENAL PROVISION UNDER SECTION 271 (1) (C) OF THE ACT, WHICH DIRECTS THAT IF INCOME IS CONCEALED OR INACCURATE RETURNS ARE FILED, WHICH ARE DISALLOWED BY THE AO, THE PENALTY SHALL BE 'THREE TIMES THE AMOUNT OF TAX SOUGHT TO B E EVADED'. IN THE CASE OF AMOUNTS DISCLOSED DURING THE COURSE OF SEARCH, THE PENALTY AMOUNT IS ONLY TEN PERCENT OF THE UNDISCLOSED INCOME. PARLIAMENT HAS, THEREFORE, GIVE N A DIFFERENT TREATMENT TO THE LATTER CATEGORY. AT THE SAME TIME, IF AN ASSESSEE WERE TO SUCCESSFULLY URGE THE 'ESCAPE ROUTE' SO TO SAY, OF SECTION 271AAA (2), ALL THREE CONDITIONS ME NTIONED IN THE PROVISION, (AS HELD IN GEBILAL KANHAIALAL'S CASE ( SUPRA ) IN RESPECT OF PARI MATERIAL PROVISIONS) HAVE TO N ECESSARILY BE FULFILLED. IN THE PRESET CASE, THE ASSESSEE, WHI LE DECLARING THE 'UNDISCLOSED INCOME' ALSO STATED, THAT 'THE SURRENDER IS BEING MADE SUBJECT T O NO PENAL ACTION OF SECTION 271 (1) (C)'. 15. WHILE DEALING WITH A CASE OF SIMILAR SURRENDER- BU T MADE IN THE COURSE OF SURVEY PROCEEDINGS, BY AN ASSESSEE (WHICH LED TO IMPOSITIO N OF PENALTY), THE SUPREME COURT, IN MAK DATA (P) LTD . V CIT [2013] 38 TAXMANN.COM 448/358 ITR 539 HELD AS FOLLOWS: '7. THE AO, IN OUR VIEW, SHALL NOT BE CARRIED AWAY BY THE PLEA OF THE ASSESSEE LIKE 'VOLUNTARY DISCLOSURE', 'BUY PEACE', 'AVOID LITIGAT ION', 'AMICABLE SETTLEMENT', ETC. TO EXPLAIN AWAY ITS CONDUCT. THE QUESTION IS WHETHER T HE ASSESSEE HAS OFFERED ANY EXPLANATION FOR CONCEALMENT OF PARTICULARS OF INCOM E OR FURNISHING INACCURATE PARTICULARS OF INCOME. EXPLANATION TO 271 RAISES A PRESUMPTION OF CONCEALMENT, WHEN A DIFFERENCE IS NOTICED BY THE AO, BETWEEN REPORTED A ND ASSESSED INCOME. THE BURDEN IS ITA NO. 3547/DEL/2015 9 THEN ON THE ASSESSEE TO SHOW OTHERWISE, BY COGENT A ND RELIABLE EVIDENCE. WHEN THE INITIAL ONUS PLACED BY THE EXPLANATION, HAS BEEN DI SCHARGED BY HIM, THE ONUS SHIFTS ON THE REVENUE TO SHOW THAT THE AMOUNT IN QUESTION CON STITUTED THE INCOME AND NOT OTHERWISE. 8. ASSESSEE HAS ONLY STATED THAT HE HAD SURRENDERED THE ADDITIONAL SUM OF RS.40,74,000/- WITH A VIEW TO AVOID LITIGATION, BUY PEACE AND TO CHANNELIZE THE ENERGY AND RESOURCES TOWARDS PRODUCTIVE WORK AND TO MAKE A MICABLE SETTLEMENT WITH THE INCOME TAX DEPARTMENT. STATUTE DOES NOT RECOGNIZE T HOSE TYPES OF DEFENCES UNDER THE EXPLANATION 1 TO 271 (1) (C) OF THE ACT. IT IS TRIT E LAW THAT THE VOLUNTARY DISCLOSURE DOES NOT RELEASE THE APPELLANT-ASSESSEE FROM THE MISCHIE F OF PENAL PROCEEDINGS. THE LAW DOES NOT PROVIDE THAT WHEN AN ASSESSEE MAKES A VOLU NTARY DISCLOSURE OF HIS CONCEALED INCOME, HE HAD TO BE ABSOLVED FROM PENALTY. 9. WE ARE OF THE VIEW THAT THE SURRENDER OF INCOME IN THIS CASE IS NOT VOLUNTARY IN THE SENSE THAT THE OFFER OF SURRENDER WAS MADE IN VIEW OF DETECTION MADE BY THE AO IN THE SEARCH CONDUCTED IN THE SISTER CONCERN OF THE ASSES SEE. IN THAT SITUATION, IT CANNOT BE SAID THAT THE SURRENDER OF INCOME WAS VOLUNTARY. AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS HAS NOTICED THAT CERTAIN DOCUMENTS COMP RISING OF SHARE APPLICATION FORMS, BANK STATEMENTS, MEMORANDUM OF ASSOCIATION OF COMPA NIES, AFFIDAVITS, COPIES OF INCOME TAX RETURNS AND ASSESSMENT ORDERS AND BLANK SHARE TRANSFER DEEDS DULY SIGNED, HAVE BEEN IMPOUNDED IN THE COURSE OF SURVEY PROCEEDINGS UNDER SECTION 133A CONDUCTED ON 16-12-2003, IN THE CASE OF A SISTER CO NCERN OF THE ASSESSEE.' 16. THAT THE INCOME WHICH WAS ULTIMATELY BROUGHT TO TA X PURSUANT TO THE DISCLOSURE MADE, WHICH WAS VOLUNTARY ON THE PART OF THE ASSESSEE IS STATING THE OBVIOUS. THE ASSESSEE MERELY STATED THAT THE SUMS ADVANCED WERE UNDISCLOSED INCO ME. HOWEVER, SHE DID NOT SPECIFY HOW SHE DERIVED THAT INCOME AND WHAT HEAD IT FELL IN (R ENT, CAPITAL GAIN, PROFESSIONAL OR BUSINESS INCOME OUT OF MONEY LENDING, SOURCE OF THE MONEY ET C). UNLESS SUCH FACTS ARE MENTIONED WITH SOME SPECIFICITY, IT CANNOT BE SAID THAT THE A SSESSEE HAS FULFILLED THE REQUIREMENT THAT SHE, IN HER STATEMENT (UNDER SECTION 132 (4)) 'SUBS TANTIATES THE MANNER IN WHICH THE UNDISCLOSED INCOME WAS DERIVED'. SUCH BEING THE CAS E, THIS COURT IS OF OPINION THAT THE LOWER APPELLATE AUTHORITIES MISDIRECTED THEMSELVES IN HOLDING THAT THE CONDITIONS IN SECTION 271AAA (2) WERE SATISFIED BY THE ASSESSEE. 17. FOR THE ABOVE REASONS, IT IS HELD THAT THE IMPUGNE D ORDER IS IN ERROR; THE SUBSTANTIAL QUESTION OF LAW IS ANSWERED IN FAVOUR OF THE REVENU E AND AGAINST THE ASSESSEE. THE APPEAL IS CONSEQUENTLY ALLOWED. NO COSTS. 6. THE CO-ORDINATE BENCH OF TRIBUNAL IN THE CASE OF ACIT VS. M/S. SSA INTERNATIONAL LTD. VIDE ORDER DATED 30.05.2018 (ITA NO. 5051/DEL/2013 A.Y. 2010-11), AFTER CONSIDERING VARIOUS DECISIONS ON TH E ISSUE, HAS ALSO RELIED ON THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT I N AFORESAID CASE, OBSERVING AS UNDER : ITA NO. 3547/DEL/2015 10 4. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVE S OF THE PARTIES TO THE APPEAL, GONE THROUGH THE DOCUMENTS RELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN THE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CAS E. 5. UNDISPUTEDLY, DURING THE SEARCH AND SEIZURE OPER ATION CONDUCTED AT THE BUSINESS AND RESIDENTIAL PREMISES OF THE ASSESSEE U/S 132(1) ON 11.12.2009, ASSESSEE SURRENDERED ADDITIONAL INCOME OF RS.21 CRORES. IT IS ALSO NOT I N DISPUTE THAT IN THE RETURN FILED BY THE ASSESSEE FOR AY 2010-11, ASSESSEE DECLARED UNDISCLO SED INCOME OF RS.21 CRORES WHICH INCLUDES RS.9.25 CRORES ON ACCOUNT OF EXCESS STOCK AND RS.11.75 CRORES AS INCOME FROM OTHER SOURCES IN THE COMPUTATION OF INCOME ANNEXED WITH THE TAX RETURN. IT IS ALSO NOT IN DISPUTE THAT THE ASSESSEE HAS EXPRESSED HIS INABILI TY TO EXPLAIN CERTAIN SEIZED DOCUMENTS RATHER STATED THAT THOSE MAY BE INCLUDED TO FORM PA RT OF THE AMOUNTS SURRENDERED DURING SEARCH AND SEIZURE OPERATION. IT IS ALSO NOT IN DIS PUTE THAT ASSESSEE HAS ALREADY PAID TAX TOGETHER WITH INTEREST ON THE SURRENDERED INCOME OF RS.21 CRORES. 6. IN THE BACKDROP OF THE AFORESAID FACTS AND CIRCU MSTANCES OF THE CASE, ORDER PASSED BY LD. REVENUE AUTHORITIES BELOW, ARGUMENTS ADVANCED BY LD . AR FOR THE PARTIES, THE SOLE QUESTION ARISES FOR DETERMINATION IN THIS CASE IS :- AS TO WHETHER ASSESSEE HAS FAILED TO SUBSTANTIATE THE MANNER IN WHICH THE UNDISCLOSED INCOME OF RS.21 CRORES WAS DERIVED AND IS LIABLE TO BE PENALIZED U/S 271AAA OF THE ACT. 7. TO PROCEED FURTHER, PROVISIONS CONTAINED UNDER S ECTION 271AAA (2) ARE REPRODUCED AS UNDER FOR READY PERUSAL :- 271AAA. (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 1ST DAY OF JUNE, 2007 BUT BEFORE THE 1ST DAY OF JULY, 2012, THE ASSESSEE SHALL PAY BY WA Y OF PENALTY, IN ADDITION TO TAX, IF ANY, PAYABLE BY HIM, A SUM COMPUTED AT THE RATE OF TEN PER CENT OF THE UNDISCLOSED INCOME OF THE SPECIFIED PREVIOUS YEAR. (2) NOTHING CONTAINED IN SUB-SECTION (1) SHALL APPL Y IF THE ASSESSEE, (I) IN THE COURSE OF THE SEARCH, IN A STATEMENT UND ER SUB-SECTION (4) OF SECTION 132, ADMITS THE UNDISCLOSED INCOME AND SPECIFIES TH E MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED; (II) SUBSTANTIATES THE MANNER IN WHICH THE UNDISCLO SED INCOME WAS DERIVED; AND (III) PAYS THE TAX, TOGETHER WITH INTEREST, IF ANY , IN RESPECT OF THE UNDISCLOSED INCOME 8. UNDER SECTION 271AAA(2)(I) OF THE ACT, PENALTY @ 10% OF THE UNDISCLOSED INCOME SHALL NOT BE IMPOSED IF THE ASSESSEE, IN THE COURSE OF THE SEARCH, IN A STATEMENT UNDER SUB-SECTION (4) OF SECTION 132, ADMITS THE UNDISCLOSED INCOME A ND SPECIFIES THE MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED SUBSTANTIATES THE MANNER IN WHICH THE UNDISCLOSED INCOME WAS DERIVED AND PAYS THE TAX TOGETHER WITH INTEREST IF ANY ON THE UNDISCLOSED INCOME. ITA NO. 3547/DEL/2015 11 9. DURING THE COURSE OF SEARCH, A SPECIFIC QUESTION WAS PUT TO SHRI ANIL MITTAL, MD OF THE ASSESSEE COMPANY TO EXPLAIN CERTAIN SEIZED DOCUME NTS AND DISCREPANCIES IN THE STOCK WHO HAS ANSWERED AS UNDER :- I HAVE SEEN QUESTION NO.43 AND THE REPLY OF SHRI A .K. NIJHAWAN TO IT AND ACKNOWLEDGE THE SAME TO BE TRUE. REGARDING THE DISC REPANCY TO STOCK FOUND BY YOUR SEARCH TEAM, DURING THE COURSE OF SEARCH, I AM UNABLE TO RECONCILE THE SAME. HOWEVER, IN ORDER TO BUY A PEACE OF MIND AND AVOID THE LITIGATION WITH DEPARTMENT, I WILL ACCEPT THE INVENTORY OF STOCK TA KEN BY YOUR TEAM DURING THE COURSE OF SEARCH ON 11.12.2009. THIS WILL FORM THE PART OF SURRENDER WHICH I HAD ALREADY MADE AT THE TIME OF SEARCH. THIS VOLUNTARY DISCLOSURE IS MADE IN ORDER TO BUY PEACE OF MIND AND AVOID ANY LITIGATION MADE BY THE DEPARTMENT. IT IS STATED THAT THIS DISCLOSURE IS MADE TO AVOID ANY PA NEL-ACTION INCLUDING PENALTIES AND PROSECUTION '. 10. THE LD. CIT (A) DELETED THE PENALTY ON THE PREM ISE THAT IF NO SPECIFIC QUESTION WAS PUT TO ASSESSEE U/S 132(4), IT CANNOT BE CONCLU DED THAT THE ASSESSEE HAS FAILED TO REPLY OR SPECIFY/ SUBSTANTIATE THE MANNER OF CONCEALMENT. IT IS SETTLED PRINCIPLE OF LAW THAT ASSESSEE HAS TO SPECIFY THE MANNER IN WHICH INCOME HAS BEEN DERIVED AND SUBSTANTIATED THE MANNER IN WHICH THE UNDISCLOSED INCOME WAS DERI VED AT THE TIME OF SEARCH IN ITS STATEMENT RECORDED U/S 132(4) AND NOT THEREAFTER. 11. HOWEVER, ANSWER TO THE QUESTION NO.43 REPRODUCE D ABOVE CATEGORICALLY GOES TO PROVE THAT THE ASSESSEE HAS SHOWN HIS INABILITY TO RECONCILE THE DISCREPANCY IN THE STOCK FOUND AND FAILED TO SUBSTANTIATE THE MANNER IN WHIC H INCOME HAS BEEN DERIVED BY THE SEARCH TEAM DURING THE COURSE OF SEARCH, HOWEVER HA S MADE THE DISCLOSURE ONLY IN ORDER TO BUY PEACE OF MIND AND TO AVOID LITIGATION. SO, WE ARE OF THE CONSIDERED VIEW THAT THE ASSESSEE HAS FAILED TO SATISFY THE CONDITIONS LAID DOWN IN SECTION 271AAA (2) SO AS TO GET THE GENERAL AMNESTY U/S 271AAA(2) BECAUSE THE ASSESSEE HAS NEITHER SPECIFY THE MANNER NOR SUBSTANTIATE THE MANNER IN WHICH THE UNDISCLOSED IN COME WAS DERIVED. 11. THE LD. AR FOR THE ASSESSEE RELIED UPON PLETHOR A OF CASE LAWS CITED AS UNDER :- 1. PR. CIT VS. MUKESH BHAI RAMAN LAL TAX APPEAL 43 4 OF2017 2. PCIT VS. EMIRATES TECHNOLOGIES PVT. LTD. [2017] 399 ITR 189 (DELHI) 3. PCIT V S. SANDEEP GUPTA (DHC) ITA NO. 967-68/201 7 DATED 13.11.2017 4. PCIT VS. SWAPNA ENTERPRISE [2018] 401 ITR 488 (G UJRAT HC) 5. SMT. RAJ RANI GUPTA VS. DCIT (DELHI I.T. TRIB.) ITA NO. 3371/DE1/2011 DATED 30.03.2012 6. ACIT V S. SHREENARAYAN SITARAM MUNDRA [2017] 83 TAXMANN.COM 231 (AHMEDABAD- TRIB) 7. NEERAT SINGAL VS. ACIT [2013] 37 TAXMANN.COM 189 (DELHI- TRIB.) 8. ACIT VS. BHAVI CHAND JINDAL (DELHI I.T. TRIB.) I TA NO. 6810/DE1/2015 DATED 17.04.2018 9. DCIT VS. ASHOK NAGRATH [2015] 57 TAXMANN.COM 15 (DELHI-TRIB.) 10. ASHWANI KUMAR ARORA VS. ACIT [2017] 81 TAXMANN. COM 440 (DELHI-TRIB.) 11. CONCRETE DEVELOPERS VS. ACIT [2013] 34 TAXMANN .COM 62 (NAGPUR- TRIB.) 12. SITA RAM GUPTA VS. ACIT [2014] 48 TAXMANN.COM 3 27 (DELHI-TRIB.) ITA NO. 3547/DEL/2015 12 13. CIT VS. RADHA KISHAN GOEL [2005] 278 ITR 454 (A LLAHABAD- TRIB.) 14. CIT VS. MAHENDRA C. SHAH [2008] 299 ITR 305 ( GUJRAT-H.C.) 15. MOTHERS PRIDE EDUCATION PERTSONNA P. LTD. (DELH I I.T. TRIB.) ITA NO. 3372/DE1/2011 DATED 12.10.2012 16. JCIT VS. SHRI JAYENDRA N. SHAH (AHMEDABAD I.T. TRIB.) ITA NO 1552/AHD/2016 DATED 16.03.2018 17. SANTOSH KUMAR VS. DCIT (DELHI I.T. TRIB.) ITA N O. 267/DEL/2014 DATED 13.04.2018 12. MORE PARTICULARLY, THE DECISION OF HONBLE HIGH COURT OF GUJARAT CITED AS PR. CIT-2 VS. MUKESHBHAI RAMANLAL PRAJAPATI TAX APPEAL NO.4 34 OF 2017 ORDER DATED 24.07.2017 WHEREIN DECISION RENDERED IN CIT VS. MAHENDRA C SHA H 299 ITR 307 AND CIT VS. RADHA KISHAN GOEL 278 ITR 454 (ALL.) HAVE BEEN DISCUSSE D AND IN THE CASE CITED AS PCIT VS. EMIRATES TECHNOLOGIES PVT. LTD. (2017) 399 ITR 18 9 (DELHI) RELIED UPON BY THE LD. AR ALSO WHEREIN HONBLE DELHI HIGH COURT HELD THAT WHE N NO QUERY RAISED BY THE AO REGARDING MANNER OF DERIVATION OF SUCH INCOME AND ITS SUBSTAN TIATION, PENALTY U/S 271AAA IS NOT SUSTAINABLE. 13. HOWEVER, HONBLE HIGH COURT OF DELHI IN A CASE RELIED UPON BY THE LD. CIT DR CITED AS PR.CIT VS. SMT. RITU SINGAL (2018) 92 TA XMANN.COM 224 (DELHI) AFTER DISCUSSING THE DECISIONS RELIED UPON BY THE LD. AR RENDERED BY HONBLE APEX COURT IN ACIT VS. GEBILAL KANHAIALAL 348 ITR 561 (SC) AND MAK DATA (P.) LTD. VS. CIT 358 ITR 539 (SC), HONBLE HIGH COURT OF GUJARAT IN CIT VS. MAHENDRA C. SHAH 299 ITR 305 (GUJ.), HONBLE ALLAHABAD HIGH COURT IN CIT VS. RADHA KISHAN GOEL - 278 ITR 454 (A LL.), HONBLE DELHI HIGH COURT IN MOTHERS PRIDE EDUCATION PERSONNEL (P.) LTD. VS. DCI T ITA NO.3372 (DELHI OF 2011 DATED 12.10.2012, REVERSED THE DECISION RENDERED BY THE T RIBUNAL SETTING ASIDE THE PENALTY ON THE GROUND THAT IN THE ABSENCE OF THE QUERY RAISED BY T HE AUTHORIZED OFFICER DURING THE COURSE OF RECORDING OF STATEMENT U/S 132 (4) TO SPECIFY AN D SUBSTANTIATE THE MANNER IN WHICH THE UNDISCLOSED INCOME WAS DERIVED BY RETURNING THE FOL LOWING FINDINGS :- 16. THAT THE INCOME WHICH WAS ULTIMATELY BROUGHT T O TAX PURSUANT TO THE DISCLOSURE MADE, WHICH WAS VOLUNTARY ON THE PART OF THE ASSESSEE IS STATING THE OBVIOUS. THE ASSESSEE MERELY STATED THAT THE SUMS A DVANCED WERE UNDISCLOSED INCOME. HOWEVER, SHE DID NOT SPECIFY HOW SHE DERIVE D THAT INCOME AND WHAT HEAD IT FELL IN (RENT, CAPITAL GAIN, PROFESSIONAL O R BUSINESS INCOME OUT OF MONEY LENDING, SOURCE OF THE MONEY ETC). UNLESS SUCH FACT S ARE MENTIONED WITH SOME SPECIFICITY, IT CANNOT BE SAID THAT THE ASSESSEE HA S FULFILLED THE REQUIREMENT THAT SHE, IN HER STATEMENT (UNDER SECTION 132 (4)) 'SUBS TANTIATES THE MANNER IN WHICH THE UNDISCLOSED INCOME WAS DERIVED'. SUCH BEI NG THE CASE, THIS COURT IS OF OPINION THAT THE LOWER APPELLATE AUTHORITIES MISDIR ECTED THEMSELVES IN HOLDING THAT THE CONDITIONS IN SECTION 271 AAA (2) WERE SAT ISFIED BY THE ASSESSEE. 14. HOWEVER, THE INSTANT CASE IS ON BETTER FOOTING THAN SMT. RITU SINGHAL (SUPRA) CASE BECAUSE IN REPLY TO THE SPECIFIC QUERY RAISED BY TH E AO DURING SEARCH PROCEEDINGS, ASSESSEE HAS EXPRESSED HIS INABILITY TO EXPLAIN THE DISCREPA NCY IN THE STOCK IN ORDER TO SUBSTANTIATE THE MANNER IN WHICH INCOME IN QUESTION HAS BEEN DER IVED RATHER CATEGORICALLY STATED THAT HE HAS MADE VOLUNTARY 9 ITA NO.5051/DEL./2013 SURRE NDER OF RS.21 CRORES IN ORDER TO BUY ITA NO. 3547/DEL/2015 13 PEACE OF MIND AND AVOID LITIGATION. SO, WHEN THE AS SESSEE HAS FAILED TO SPECIFY THE MANNER AND SUBSTANTIATE THE MANNER IN WHICH THE UNDISCLOSE D INCOME WAS DERIVED RATHER EMBARK UPON THE MERCY PLEA THAT HE IS MAKING SURRENDER TO BUY PEACE OF MIND AND AVOID LITIGATION, HE IS NOT ENTITLED FOR BENEFIT OF SECTION 271AAA(2) OF THE ACT. CASE LAWS RELIED UPON BY THE ASSESSEE IS NOT APPLICABLE TO THE FACTS AND CIRCUMS TANCES OF THE CASE. FOLLOWING THE DECISION RENDERED BY HONBLE DELHI HIGH COURT IN CASE CITED AS PR.CIT VS. SMT. RITU SINGAL (SUPRA), WE ARE OF THE CONSIDERED VIEW THAT LD. CIT (A) HAS ERR ED IN DELETING THE PENALTY OF RS.2,10,00,000/- U/S 271AAA, HENCE APPEAL FILED BY THE REVENUE IS HEREBY ALLOWED AND PENALTY ORDER PASSED BY THE AO IS RESTORED. 7. THUS, LAYING OUR HAND ON AND RESPECTFULLY FOLLOW ING THE AFORESAID LATEST DECISION OF HONBLE JURISDICTIONAL HIGH COURT, AND ALSO THE DECISION OF CO- ORDINATE BENCH OF ITAT DELHI BENCH, WE FIND NO JUST IFICATION TO INTERFERE WITH THE ORDERS OF THE AUTHORITIES BELOW. ACCORDINGLY, T HE APPEAL OF THE ASSESSEE IS FOUND DEVOID OF MERITS AND DESERVES TO FAIL. 8. IN THE RESULT, THE APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 28.01.2019. SD/- SD/- (AMIT SHUKLA) (L.P. SAHU ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 28.01.2019 *AKS* COPY OF ORDER FORWARDED TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES, NEW DELHI