ITO, Cen. 2, Nashik, Nashik V. Shri Jethmal Mulji Thakkar, Pimpalgaon

ITA 587/PUN/2012

• Counselvise Citation: 58724514 RSA 2012
• Duration Of Justice: 1 year(s) 1 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 21-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained investment; Unexplained expenditure; Search and seizure; Corroborative evidences; Revised return
• Section: 143(3); 133A; 153A; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI G.S.PANNU, ACCOUNTANT MEMBER, AND SHRI R.S.PADVEKAR, JUDICIAL MEMBER. ITA.NO.587/PN/2012 (ASSTT. YEAR : 2006-07) ITO, CENTRAL-II, NASHIK. .. APPELLANT VS. SHRI JETHMAL MULJI THAKKAR, PIMPALGAON (B), TAL-NIPHAD, DIST-NASHIK. .. RESPONDENT PAN: AAHPT1000A ASSESSEE BY : SMT.DEEPA KHARE DEPARTMENT BY : SHRI ACHAL SHARMA DATE OF HEARING : 17.04.2013 DATE OF PRONOUNCEMENT : 30.04.2013 ORDER PER R.S.PADVEKAR, JM : THIS APPEAL IS FILED BY THE REVENUE CHALLENGING TH E IMPUGNED ORDER OF THE LD. CIT(A)-I, NASHIK, DATED 06.01.2012 FOR THE A.Y. 2006-07. THE GRIEVANCE OF THE ASSESSEE AGAINST THE IMPUGNED ORDER IS IN RESPECT OF DELETING THE PENALTY LEVIED BY THE ASSESSING OFFICER U/S. 271(1)(C) OF THE INCOME TAX ACT, 1961. THE RE VENUE HAS TAKEN THE FOLLOWING EFFECTIVE GROUNDS: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED CIT(A) ERRED IN DELETING PENALTY LEVIED UNDER SECTION 271(1) (C) OF THE ACT AMOUNTING TO RS.5,49, 7807- 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED CIT(A) ERRED IN HOLDING THAT THE IMMUNI TY AS PER EXPLENATION-5 TO THE SECTION 271(1) (C) OF THE ACT WAS AVAILABLE TO THE ASSESSEE, CONTRARY TO THE FACT THA T THE ASSESSEE DID NOT SPECIFY THE MANNER IN WHICH THE ADDITIONAL INCOME DECLARED DURING SEARCH, WAS EARNE D AS PER CONDITIONS LAID DOWN IN SUB CLAUSE 2 OF CLAUSE (B) OF EXCEPTION-5 TO SECTION 271(1) (C) OF THE ACT. 2 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LEARNED CIT(A) ERRED IN HOLDING THAT DECLARATIO N OF INCOME AND PAYMENT OF TAXES THEREON IS SUFFICIENT COMPLIANCE TO GET IMMUNITY, EVENTHOUGH THE ASSESSEE HAS NOT SPECIFIED THE MANNER IN WHICH SUCH INCOME I S DERIVED RELYING ON THE DECISION OF THE GUJRAT HIGH COURT IN THE CASE OF CIT VS. MAHENDRA C. SHAH (2008) 299 ITR 305, THEREBY IGNORING THE DECISION OF THE JURISDICT IONAL HIGH COURT AT BOMBAY IN THE CASE INDUS ENGINEERING COMPANY & ANR VS. ACIT& OTHER, 184 TAXMAN 269 (2009), WHICH MAKES IT MANDATORY OF SUCH COMPLIANCE ON THE PART OF THE ASSESSEE TO GET IMMUNITY AS PROVIDE D IN EXCEPTION-5 TO SECTION 271(1) (C) OF THE ACT. 2. THE FACTS WHICH ARE REVEALED FROM THE RECORD ARE AS UNDER. THERE WAS SEARCH AND SEIZURE ACTION U/S.132 OF THE ACT IN THE THAKKAR GROUP OF CASES ON 07.12.2005 IN WHICH THE A SSESSEE WAS ALSO COVERED. THE ASSESSEE FILED THE RETURN OF INC OME DECLARING INCOME OF RS.19,79,430/- ON 31 ST OCTOBER, 2006 FOR THE A.Y. 2006-07, WHICH INCLUDED THE ADDITIONAL INCOME OF RS .18,00,000/- DECLARED BY THE ASSESSEE DURING THE COURSE OF SEARC H. ASSESSMENT OF THE ASSESSEE WAS COMPLETED U/S.143(3) ON 24.12.2 007 AND ASSESSING OFFICER INITIATED THE PENALTY PROCEEDINGS U/S.271(1)(C) OF THE ACT FOR CONCEALING THE PARTICULARS OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME TO THE EXTENT OF R S.18,00,000/- WHICH WAS ON ACCOUNT OF EXCESS CASH FOUND DURING TH E SEARCH PROCEEDINGS, UNEXPLAINED INVESTMENT IN JEWELLERY AN D UNEXPLAINED EXPENDITURE DETECTED THROUGH THE SEIZED PAPERS ETC. ASSESSING OFFICER SOUGHT THE EXPLANATION OF THE ASSESSEE WHY THE PENALTY SHOULD NOT BE LEVIED U/S.271(1)(C) OF THE ACT. ASS ESSEE FILED THE DETAILED REPLY WHICH IS REPRODUCED IN THE PENALTY O RDER BY THE ASSESSING OFFICER. THE ASSESSEE CLAIMED THE IMMUNI TY AS PER CLAUSE (2) TO EXPLANATION 5 OF SECTION 271(1)(C) OF THE AC T. ASSESSEE CONTENDED THAT IN THE STATEMENT RECORDED U/S.132(4) ON 07.12.2005, 08.12.2005, THE ASSESSEE OFFERED VOLUNT ARILY RS.18,00,000/- AS ADDITIONAL INCOME. ASSESSEE ALSO SUBMITTED THAT THE INCOME SHOWN IN THE RETURN OF INCOME WAS ACCEPT ED BY THE ASSESSING OFFICER WHILE COMPLETING THE ASSESSMENT. ASSESSEE PLACED RELIANCE ON PLETHORA OF DECISIONS CLAIMING T HE IMMUNITY AS 3 PER CLAUSE (2) OF EXPLANATION 5 TO SECTION 271(1)(C ) OF THE ACT. ASSESSING OFFICER WAS NOT IMPRESSED WITH THE EXPLAN ATION OF THE ASSESSEE. IN THE OPINION OF THE ASSESSING OFFICER, THE ASSESSEE WAS NOT ENTITLED FOR THE IMMUNITY UNDER CLAUSE (2) OF E XPLANATION 5 TO SECTION 271(1)(C) AS ASSESSEE HAS NOT EXPLAINED THE MANNER IN WHICH THE INCOME DISCLOSED WAS EARNED. ASSESSING OFFICER, THEREFORE, LEVIED THE PENALTY OF RS.5,49,780/-. AS SESSEE CHALLENGED THE PENALTY ORDER BEFORE THE LD. CIT(A). THE LD. C IT(A) DELETED THE PENALTY. THE OPERATIVE PORTION OF THE FINDING OF T HE CIT(A) ARE AS UNDER: 5.3. I HAVE CAREFULLY CONSIDERED THE FACTS OF TH E CASE, THE ASSESSMENT ORDER, THE PENALTY ORDER, THE RIVAL CONT ENTIONS AND THE POSITION OF LAW ON THE SUBJECT. THE APPELLANT H AS OFFERED TO TAX AN AMOUNT OF RS.18,00,000/- AS ADDITIONAL INCOM E ON ACCOUNT OF EXCESS CASH FOUND, UNEXPLAINED INVESTMEN T IN JEWELLERY AND UNEXPLAINED EXPENDITURE, ETC DURING S EARCH ACTION IN STATEMENT U/S 132(4) ON 07/12/2005 AND AL SO IN THE RETURN OF INCOME FILED U/S 139(1) OF THE ACT ON 31/ 10/2006. IN VIEW OF THESE FACTS PROVISIONS OF EXPLANATION 5 TO SECTION 271(L)(C) HAVE TO BE EXAMINED AND IS REPRODUCED BEL OW:- EXPLANATION-5 - WHERE IN THE COURSE OF A [SEARCH INITIATED UNDER SECTION 132 BEFORE THE 1 ST DAY OF JUNE, 2007], THE ASSESSEE IS FOUND TO BE THE OWNER OF ANY MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING (HEREAFTER IN THIS EXPLANATION REFERRED TO AS ASSETS) AND THE ASSESSEE CLAIMS THAT SUCH ASSETS HAVE BEEN ACQUIRED BY HIM BY UTILIZING (WHOLLY OR IN PART) HI S INCOME - (A) FOR ANY PREVIOUS YEAR WHICH HAS ENDED BEFORE TH E DATE OF THE SEARCH, BUT THE RETURN OF INCOME FOR SUCH YEAR HAS NOT BEEN FURNISHED BEFORE THE SAID DATE OR, WHERE SUCH RETURN HAS BEEN FURNISHED BEFORE THE SAID DATE, SUCH INCOME HAS NOT BEEN DECLARED THEREIN; OR (B) FOR ANY PREVIOUS YEAR WHICH IS TO END ON OR AFT ER THE DATE OF THE SEARCH, THEN, NOTWITHSTANDING THAT SUCH INCOME IS DECLARED BY HIM IN ANY RETURN OF INCOME FURNISHED ON OR AFTER THE DATE OF THE SEARCH , HE SHALL, FOR THE PURPOSES OF IMPOSITION OF A PENAL TY UNDER CLAUSE (C) OF SUB-SECTION (1) OF THIS SECTION , BE DEEMED TO HAVE CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME, [UNLESS,- (I) IN A CASE FALLING UNDER CLAUSE (A), BEFORE THE DATE OF THE SEARCH; AND 4 (II) IN A CASE FALLING UNDER CLAUSE (B), ON OR BEFORE SUCH DATE, IN THE BOOKS OF ACCOUNT, IF ANY, MAINTAINED BY HIM FOR ANY SOURCE OF INCOME OR SUCH INCOME IS OTHERWISE DISCLOSED TO THE [ CHIEF COMMISSIONER OR COMMISSIONER ] BEFORE THE SAID DATE; OR (2) HE, IN THE COURSE OF THE SEARCH, MAKES A STATEM ENT UNDER SUB-SECTION(4) OF SECTION 132 THAT ANY MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THI NG FOUND IN HIS POSSESSION OR UNDER HIS CONTROL, HAS BEEN AC QUIRED OUT OF HIS INCOME WHICH HAS NOT BEEN DISCLOSED SO F AR IN HIS RETURN OF INCOME TO BE FURNISHED BEFORE THE EXP IRY OF TIME SPECIFIED IN SUB-SECTION (1) OF SECTION 139, A ND ALSO SPECIFIES IN THE STATEMENT THE MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED AND PAYS THE TAX, TOGETHER WITH INTEREST, IF ANY, IN RESPECT OF SUCH INCOME.] IN VIEW OF THE ABOVE PROVISION, IT IS EVIDENT THAT IN ORDER TO BE ENTITLED TO IMMUNITY FROM PENALTY U/S 271(L)( C) FOLLOWING CONDITIONS ARE TO BE FULFILLED:- (I) THE DUE DATE OF FILING THE RETURN SHOULD EXPIRE AFTER THE DATE OF SEARCH. (II) THE INCOME SHOULD BE OFFERED IN THE STATEMENT RECORDED IN THE COURSE OF SEARCH, SPECIFYING THE MA NNER OF EARNING THE INCOME IN THE STATEMENT RECORDED U/S 132(4) AND (III) THE INCOME SHOULD BE OFFERED TO TAX IN THE RE TURN OF INCOME AND DUE TAXES ON THE INCOME OFFERED SHOULD B E PAID. THE AO HAS IMPOSED THE PENALTY STATING THAT THE APP ELLANT HAS NOT STATED THE MANNER IN WHICH THE INCOME OFFERED T O TAX HAS BEEN EARNED AND HENCE THE CONDITIONS LAID DOWN BY EXPLANATION 5 TO SECTION 271(L)(C) HAS NOT BEEN FUL FILLED. IN THE CASE UNDER APPEAL, THE APPELLANT HAS FULFILL ED THE ABOVE CONDITIONS. THE APPELLANT HAS OFFERED TO TAX THE IN COME OF RS.18,00,000/- IN THE STATEMENT RECORDED U/S 132(4) AND ALSO IN THE RETURN OF INCOME FILED U/S 139(1) AND HAS PA ID THE TAXES ON THE SAID INCOME OFFERED. IT HAS ALSO BEEN NOTICE D THAT IN THE COURSE OF RECORDING OF STATEMENT U/S 132(4), THE AP PELLANT WAS NOT ASKED TO EXPLAIN/STATE THE MANNER OF EARNING TH E ABOVE INCOME OFFERED TO TAX, THEREFORE, THERE WAS NO OCCA SION FOR THE APPELLANT TO EXPLAIN THE MANNER OF EARNING THE INCO ME OF RS.18,00,000/- OFFERED TO TAX. IT IS WORTH NOTING H ERE THAT THE ABOVE ISSUE HAS BEEN DECIDED BY HON'BLE GUJARAT HIG H COURT IN THE CASE OF CIT VS. MAHENDRA C. SHAH (2008) 299 ITR 305. THE RELEVANT PORTION OF THE DERISION IS REPRODUCED BELOW:- '15. INSOFAR AS THE ALLEGED FAILURE ON THE PART OF THE ASSESSEE TO SPECIFY IN THE STATEMENT U/S. 132(4) OF THE 5 ACT REGARDING THE MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED, SUFFICE IT TO STATE THAT WHEN THE STA TEMENT IS BEING RECORDED BY THE AUTHORIZED OFFICER IT IS I NCUMBENT UPON THE AUTHORIZED OFFICER TO EXPLAIN THE PROVISIO NS OF EXPL.5 IN ENTIRETY TO THE ASSESSEE CONCERNED AND TH E AUTHORIZED OFFICER CANNOT STOP SHORT AT A PARTICULA R STAGE SO AS TO PERMIT THE REVENUE TO TAKE ADVANTAGE OF SU CH A LAPSE IN THE STATEMENT. THE REASON IS NOT FAR TO SE EK TO THE FIRST INSTANCE, SHE STATEMENT IS BEING RECORDED IN THE QUESTION AND ANSWER FORM AND THERE WOULD BE NO OCCASION FOR AN ASSESSEE TO STATE AND MAKE AVERMENT S IN THE EXACT FORMAT STIPULATED BY THE PROVISIONS CONSI DERING THE SETTING IN WHICH SUCH STATEMENT IN BEING RECORD ED, AS NOTED BY ALLAHABAD HIGH COURT IN CASE OF RADHA KISH AN GOEL (SUPRA). SECONDLY, CONSIDERING THE SOCIAL ENVIRONMENT IT IS NOT POSSIBLE TO EXPECT FROM AN AS SESSEE, WHETHER LITERATE OR ILLITERATE, TO BE SPECIFIC AND TO THE POINT REGARDING THE CONDITIONS STIPULATED BY EXCEPT ION NO.2 WHILE MAKING STATEMENT U/S. 132(4) OF THE ACT. THE VIEW TAKEN BY THE TRIBUNAL AS WELL AS ALLAHABAD HIG H COURT TO THE EFFECT THAT EVEN IF THE STATEMENT DOES NOT SPECIFY THE MANNER IN WHICH THE INCOME IS DERIVED, IF THE INCOME IS DECLARED AND TAX THEREON PAID, THERE WOUL D BE SUBSTANTIAL COMPLIANCE NOT WARRANTING ANY FURTHER D ENIAL OF THE BENEFIT UNDER EXCEPTION NO.2 IN EXPLN.5 IS COMMENDABLE. 16. HENCE THE TRIBUNAL WAS JUSTIFIED IN COMING TO T HE CONCLUSION THAT INSOFAR AS THE VALUE OF DIAMONDS WA S CONCERNED, THE ASSESSEE HAVING MADE A DECLARATION U /S. 132(4) OF THE ACT AND PAID TAXES THEREON, HAD FULFI LLED ALL THE CONDITIONS FOR AVAILING THE BENEFIT OF IMMUNITY FROM LEVY OF PENALTY AS PROVIDED UNDER EXPLN. 5 TO SECTI ON 271(L)(C) OF THE ACT. IN ABSENCE OF ANY INFIRMITY I N THE ORDER OF TRIBUNAL ON THIS COUNT THE QUESTION REFERR ED IS ANSWERED IN THE AFFIRMATIVE I.E. IN FAVOUR OF THE A SSESSEE AND AGAINST THE REVENUE.' 5.4 THE HON'BLE ITAT IN THE CASE OF DCIT VS. DR. SA TISH B. GUPTA(2011) 135 TTJ (AHD.) 611 HAS HELD AS UNDER: 'PROCEEDINGS AS USED IN SECTION 271(L)(C) ARE STATU TORY PROCEEDINGS INITIATED AGAINST THE ASSESSEE EITHER B Y ISSUANCE OF STATUTORY NOTICES OR AFTER FILING OF RE TURN OF INCOME. A SURVEY U/S 133A OR A SEARCH U/S 132(1) OR A NOTICE U/S 133(6), FOR EXAMPLE ARE ONLY MEANS OF COLLECTING EVIDENCE AGAINST THE ASSESSEE AND MERELY CARRYING OUT A SURVEY ACTION DOES NOT CREATE ANY LI ABILITY AGAINST THE ASSESSEE WHICH IS IN FACT CREATED ONLY THROUGH ASSESSMENT PROCEEDINGS OR PENALTY PROCEEDINGS. THEREFORE, AN ACT OF CONCEALMENT OR FURNISHING OF INACCURATE PARTICULARS SHOULD BE VIEWED BY THE AO W ITH 6 RESPECT TO THE RETURN OF INCOME. THE OMISSION OR COMMISSION OR CONTUMACIOUS CONDUCT HAS TO BE VIEWED FROM THE RETURN OF INCOME AND IF CERTAIN THING IS N OT DISCLOSED OR NOT FURNISHED THEREIN ONLY THEN IT CAN BE SAID THAT ASSESSEE HAS CONCEALED THE PARTICULARS OF INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOM E. THEREFORE WHERE THE AO HAS ACCEPTED THE INCOME DECLARED IN THE RETURN OF INCOME THEN THE ASSESSEE CANNOT BE CHARGED FOR ANY CONTUMACIOUS CONDUCT, AND WHERE THE RETURNED INCOME HAS BEEN ACCEPTED THERE I S NO CASE FOR ANY IMPOSITION OF PENALTY. CIT VS. PRAKASH INDUSTRIES LTD. (2010) 322 ITR 622 (P&H) AND SMT. GOVINDA DEVI VS. CIT (2008) 220 CTR (ALL.) 189 : (2 008) 14 DTR (ALL). 341 : (2008) 304 ITR 340 (ALL.) RELIE D ON'. 5.5 THE JURISDICTIONAL IT AT PUNE HAS HELD IN THE C ASE OF ACIT, JALGAON VS. M/S SUDARSHAN PAPER AND PRODUCTS, SUNAS GAON TAL. BHUSAWAL DIST. JALGAON, I.T.A. NO.996/PN/09/(A .Y. 2006- 07) DATED 30/11/2030 THAT 8: 'WE HAVE CONSIDERED TH E SUBMISSION OF THE LEARNED DR AND ALSO PERUSED THE O RDERS OF THE AUTHORITIES BELOW. FACTUALLY SPEAKING, IN THIS CASE THE ADDITIONAL INCOME OFFERED DURING THE COURSE OF SURV EY HAS BEEN ASSESSED AS SUCH IN THE SUBSEQUENT ASSESSMENT FINAL IZED U/S 143(3) OF THE I.T. ACT ON 22/08/2008. UNDOUBTEDLY, THE ADDITIONAL INCOME OF RS.6,56,300/- DECLARED DURING THE SURVEY HAS BEEN MADE A PART OF THE REVISED RETURN OF INCOM E FILED ON 19/02/2007. MERE DECLARATION OF A HIGHER INCOME IN THE REVISED RETURN AFTER THE SURVEY CANNOT BE TAKEN AS CONCEALMENT OR FURNISHING OF INACCURATE PARTICULARS OF INCOME WITHIN THE MEANING OF SECTION 271(L)(C) OF THE I.T. ACT. IN THE CASE OF SURESH CHANDRA MITTAL (SUPRA) THE HON'BLE S UPREME COURT WAS DEALING WITH A SOMEWHAT SIMILAR SITUATION . - WE FIND NO MATERIAL TO SHOW THAT THE BURDEN CAST ON TH E REVENUE IN TERMS OF SECTION 271(L)(C) TO PROVE CONCEALMENT HAS BEEN DISCHARGED. IN THIS CONTEXT, IN OUR VIEW, THE C1T(A ) WAS JUSTIFIED IN DELETING THE PENALTY IMPOSED BY THE AS SESSING OFFICER U/S 271(L)(C) OF RS.2,50,000/-. ACCORDINGLY , THE ORDER OF THE CIT(A) IS HEREBY AFFIRMED.' IN VIEW OF THE FACTS NARRATED ABOVE, IT IS AMPLE CL EAR THAT THE APPELLANT HAS NEITHER CONCEALED THE INCOME NOR FURN ISHED INACCURATE PARTICULARS OF HIS INCOME, THUS THE IMPU GNED PENALTY ORDER CANNOT BE SUSTAINED. 5.6 IN VIEW OF THE FACTS AND IN THE CIRCUMSTANCE OF THE CASE IT IS THUS EVIDENT THAT THE INGREDIENT REQUIRED FOR IN ITIATION AND LEVY OF PENALTY U/S 271(L)(C), IS NOT FULFILLED IN THIS CASE. AS THE APPELLANT HAD MADE FULL DISCLOSURE OF ALL RELEVANT FACTS IN THE RETURN OF INCOME AND HAD ACTED BONAFIDELY, AND HENC E IT CANNOT BE SAID THAT APPELLANT HAS CONCEALED THE PAR TICULARS OF INCOME WITHIN THE MEANING OF SECTION 271(L)(C)OF TH E IT. ACT, 1961. 7 5.7. THE LEARNED ASSESSING OFFICER HAS NOT CONDUCTE D ANY INDEPENDENT INVESTIGATION/ENQUIRIES AND BROUGHT ANY SUPPORTING EVIDENCE ON RECORD TO PROVE, TO REVEAL S UPPRESSION OF INCOME OR MATERIAL FOR THE PURPOSE OF LEVY OF PE NALTY U/S 271(L)(C) OF THE I.T. ACT. THE AO HAS NOT DISCHARGE D THE BURDEN OF PROVING THE CONCEALMENT AND HAD SIMPLY RESTED IT S CONCLUSION ON THE ACT OF SURRENDER BY THE ASSESSEE IN GOOD FAITH, AND THEREFORE PENALTY COULD NOT BE LEVIED. I T IS RELEVANT TO NOTE THERE THAT IN THIS CASE THE ID. AO HAS ACCEPTE D THE RETURN OF INCOME AS IS EVIDENT FROM THE ASSESSMENT ORDER U /S 153A R.W.S. 143(3) DATED 24/12/2007. 5.8 IN VIEW OF THE ABOVE FACTS AND DISCUSSION AND R ESPECTFULLY FOLLOWING THE RATIO LAID DOWN BY ABOVE DECISION IN THE CASE OF CIT VS. MAHENDRA C. SHAH (2008) 299 ITR 305; DC1T VS. DR. SATISH B. GUPTA(2011) 135 TTJ(AHD-) 611 AND ACIT JALGAON VS. M/S SUDARSHAN PAPER AND PRODUCTS IN I.T.A. NO.996/PN/09 A.Y. 2006-07, I AM OF THE CONSIDERED V IEW THAT THE CASE OF THE APPELLANT IS COVERED BY IMMUNITY PR OVIDED BY EXPLANATION 5 TO SECTION 271(L)(C) OF THE ACT. THE AO IS, THEREFORE, NOT JUSTIFIED IN IMPOSING THE PENALTY U/ S 271(L)(C). THE IMPUGNED PENALTY ORDER DATED 03/06/2008 U/S 271 (L)(C) IMPOSING PENALTY OF RS.5,49,780/- IS, THEREFORE, CA NCELLED. THE SUBSTANTIVE GROUND OF APPEAL IS ALLOWED. THE AO IS DIRECTED ACCORDINGLY. 3. WE HAVE HEARD THE PARTIES AND PERUSED THE RECORD . WE FIND THAT LD. CIT(A) HAS MADE A SPECIFIC ASSERTION THAT THE ASSESSEE HAS COMPLIED WITH THE CONDITIONS OF EXPLANATION 5 TO SE CTION 271(1)(C) OF THE ACT. MOREOVER, HE HAS ALSO FOLLOWED THE DECISI ON OF HON'BLE GUJARAT HIGH COURT IN THE CASE OF CIT VS. MAHENDRA C SHAH (2008) 299 ITR 305. IN OUR OPINION, NO INTERFERENCE IS CA LLED FOR IN THE ORDER OF THE LD. CIT(A) AS THE ASSESSEES CASE SQUA RELY COVERED BY THE PRINCIPLES LAID DOWN IN CASE OF MAHENDRA C SHAH (SUPRA). WE ACCORDINGLY CONFIRM THE SAME. 4. IN THE RESULT, REVENUES APPEAL IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON THIS THE 30 TH DAY OF APRIL, 2013. SD/- SD/- ( G.S.PANNU ) ( R.S.PADVEKAR ) ACCOUNTANT MEMBER JUDICIAL MEMBER GSPS PUNE, DATED THE 30 TH APRIL, 2013 8 COPY OF THE ORDER IS FORWARDED TO: 1. THE ASSESSEE 2. THE ITO, CENTRAL-II, NASHIK. 3. THE CIT(A)-I, NASHIK. 4. THE CIT(CENTRAL), NAGPUR. 5. THE DR B BENCH, PUNE. 6. GUARD FILE. BY ORDER //TRUE COPY// PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, PUNE.