Sh. Rajat Jain, Ludhiana V. DCIT, CC-1, Ludhiana

ITA 920/CHANDI/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 9490 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 2 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2016-2017
• Appeal Filed On: 02-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained expenditure; Search and seizure; Opportunity of being heard; Principle of natural justice; Transactions in derivatives; Valuation report; Documents seized; Set aside
• Section: 132; 12; 143(3); 14A; 274; 246A; 13; 158BFA

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BE NCH B, CHANDIGARH .., ! '# #$ %, & '( BEFORE: SHRI. N.K.SAINI, VP & SHRI , SANJAY GARG, J M ./ ITA NO. 920/CHD/2018 / ASSESSMENT YEAR : 2016-17 SH. RAJAT JAIN 9-A, AGGAR NAGAR, LUDHIANA, PUNJAB THE DY. CIT CENTRAL CIRCLE-1, LUDHIANA PUNJAB ./ PAN NO: ABAPJ4619D / APPELLANT / RESPONDENT ./ ITA NO. 922/CHD/2018 / ASSESSMENT YEAR : 2016-17 SHRI SAURAV JAIN 9-A, AGGAR NAGAR LUDHIANA THE DY. CIT CENTRAL CIRCLE-1, KITCHLU NAGAR LUDHIANA, PUNJAB ./ PAN NO: AETPJ9724P / APPELLANT / RESPONDENT ! ' / ASSESSEE BY : SHRI ASHWANI KUMAR, CA # ! ' / REVENUE BY : SHRI AMIT SHUKLA, SR. DR $ % ! &/ DATE OF HEARING : 16/09/2019 '()* ! &/ DATE OF PRONOUNCEMENT : 19/09/2019 ')/ ORDER PER N.K. SAINI, VICE PRESIDENT THESE TWO APPEALS BY THE ASSESSEES ARE DIRECTED AGAINS T THE SEPARATE ORDERS EACH DT. 28/05/2018 OF LD. CIT(A)-5, LUDHIANA. 2. SINCE THE ISSUE INVOLVED IN THE APPEALS IS COMMON A ND BOTH THE APPEALS WERE HEARD TOGETHER, SO THESE ARE BEING DISPOSED OFF BY THI S CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE AND BREVITY. 3. COMMON GROUND RAISED IN BOTH THESE APPEALS READ AS UND ER: 2 THAT ORDER PASSED U/S 250(6) OF THE INCOME TAX ACT , 1961 BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-5, LUDHIANA IS AGAINST LAW AND FACTS ON THE FILE IN AS MUCH AS HE WAS NOT JUSTIFIED TO ARBITRARILY UPHOLD THE PENALTY LEV IED U/S 271AAB AT RS. 8,00,000/-. 4. DURING THE COURSE OF HEARING THE LD. COUNSEL FOR T HE ASSESSEE SUBMITTED THAT THE ISSUE UNDER CONSIDERATION IS SQUARELY COVERED VIDE ORD ER DT. 12/07/2019 OF THIS BENCH OF THE TRIBUNAL IN THE CASES OF SMT. VEENA RANI & OTHERS, LUD HIANA VS. DCIT, CENTRAL CIRCLE- 1, LUDHIANA IN ITA NOS. 1238 TO 1240/CHD/2018 FOR THE A. Y. 2016-17 AND IN THE CASE OF M/S R.D. PALACE PVT. LTD. LUDHIANA VS. DCIT, CENTRAL C IRCLE, LUDHIANA IN ITA NO. 1241&1242/CHD2018 FOR A.YS 2015-16 & 2016-17. IT WA S STATED THAT THE ASSESSEES ALSO BELONG TO THE SAME GROUP TO WHICH THE AFORESAID ASSESS EES I.E; SMT. VEENA RANI & OTHERS BELONGED AND COMMON SEARCH TOOK PLACE ON 27/08/201 5 UNDER SECTION 132 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS ACT). IT WAS POINTED OUT THAT NO INCRIMINATING MATERIAL RELATING TO THE ASSESSEE UNDER C ONSIDERATION WAS FOUND DURING THE COURSE OF SEARCH AS WAS IN THE CASES OF SMT. VEENA RANI & OTHERS. IN SUPPORT OF THE ABOVE CONTENTION HE FURNISHED A CHART, COPY OF WHICH IS PLAC ED ON THE RECORD. 5. IN HIS RIVAL SUBMISSIONS THE LD. CIT DR SUBMITTED T HAT THE ASSESSEES THEMSELVES SURRENDERED THE AMOUNT DURING THE COURSE OF SEARCH, THERE FORE THE PENALTY UNDER SECTION 271AAB OF THE ACT WAS LEVIABLE AND THE LD. CIT( A) WAS FULLY JUSTIFIED IN CONFIRMING THE PENALTY LEVIED BY THE A.O. 6. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIE S AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CASE I T IS AN ADMITTED FACT THAT NO INCRIMINATING MATERIAL OR UNDISCLOSED ASSETS RELATING TO THE ASSESSEES UNDER CONSIDERATION WERE FOUND DURING THE COURSE OF SEARCH AS IN THE CASES OF SMT. VEENA RANI & OTHERS, SHRI SUKHDARSHAN KUMAR, SMT. SHWETA JAIN, S HRI SAURAV JAIN AND R.D PLACE PVT. LTD. ETC. WHICH IS EVIDENT FROM THE CHART F URNISHED BY THE ASSESSEE IN RESPECT OF THE PERSONS BELONGING TO THE MAHARAJA GROUP OF CASES O N WHICH SEARCH TOOK PLACE UNDER SECTION 132 OF THE ACT, ON 27/08/2015. THE SAID C HART IS REPRODUCED AS UNDER: 3 AN IDENTICAL ISSUE HAVING SIMILAR FACTS HAS ALREADY BEE N ADJUDICATED IN THE CASE OF SMT. VEENA RANI & OTHERS, AGGAR NAGAR, LUDHIANA VS. DCIT, CE NTRAL CIRCLE-1, LUDHIANA (SUPRA) WHEREIN THE RELEVANT FINDINGS HAVE BEEN GIVEN IN PA RA 7 TO 14 WHICH READ AS UNDER: 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. SO FA R AS ISSUE OF LEVY OF PENALTY U/S 271AAB OF THE ACT WHETHER IS MANDATORY OR NOT IS CO NCERNED, THE ISSUE HAS BEEN DEALT WITH BY THE COORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF M/S SEL TEXTILES LTD. VS DCIT (SUPRA). THE TRIBUNAL IN THE ABOVE CASE HAS RELIED UPON THE FOLLOWING DECISIONS OF THE COORDINATE BENCHES OF THE TRIBUNAL:- ACIT VS. MARVEL ASSOCIATES, ITA NO. 147/VIZAG/2017 ORDER DATED 16.3.2018 (ITAT VISAKHAPATNAM BENCH) ; DCIT VS. M/S RASHMI METAL IKS LTD. , ITA NO. 1608/KOLKATA/2017 DATED 1.2.2019; (ITAT KOLKATA BEN CH); DCIT VS. RASHMI CEMENT LTD, ITA NO. 1606/KOLKATA/2017 ORDER DATED 28.2.2019((ITAT KOLKA TA BENCH) 8. THE TRIBUNAL AFTER ANALYZING THE AFORESAID DECIS IONS, WHEREIN, RELIANCE HAS BEEN PLACED ON THE DECISIONS OF THE HON'BLE HIGH COURTS HAS HELD THAT LEVY OF PENALTY U/S 271AAB OF THE ACT IS NOT MANDATORY AS THE PROVISION S OF SECTION 274 OF THE ACT HAVE BEEN MADE APPLICABLE IN RELATION TO THE PENALTY REFERRED TO SECTION 271AAB OF THE ACT. IT HAS BEEN HELD THAT THE PENALTY U/S 271AAB WILL NOT BE A TTRACTED IF THE SURRENDERED INCOME WOULD NOT FALL IN THE DEFINITION OF UNDISCLOSED IN COME AS DEFINED UNDER EXPLANATION TO SECTION 271AAB OF THE ACT. THE RELEVANT PART OF THE ORDER OF THE TRIBUNAL IN M/S SEL TEXTILES LTD. VS DCIT DATED 18.04.2019(SUPRA) FOR THE PURPO SE OF READY REFERENCE IS REPRODUCED AS UNDER:- 6. THE LD. DR, ON THE OTHER HAND, HAS SUBMITTED TH AT THE ASSESSEE HIMSELF HAD SURRENDERED AN AMOUNT OF RS. 14,39,99,258/- AS ITS UNDISCLOSED INCOME OF THE YEAR AND SINCE THE ASSESSEE DID NOT SUBSTANTIATE THE MAN NER OF EARNING OF THE SAID INCOME, HENCE, THE ASSESSING OFFICER RIGHTLY IMPOSE D THE PENALTY UNDER THE 4 PROVISIONS OF SECITON271AAB (1)(C) OF THE ACT. HE HAS FURTHER SUBMITTED THAT EVEN OTHERWISE, AS PER THE PROVISIONS OF SECTION 271AAB OF THE ACT, THE LEVY OF PENALTY IS MANDATORY. HOWEVER, THE RATE AT WHICH THE PENALTY IS TO BE LEVIED DEPENDS UPON CERTAIN CONDITIONS AS ENUMERATED IN CLAUSE (A), CLA USE (B) AND CLAUSE (C) RESPECTIVELY TO SUB SECTION (1) TO SECTION 271ABB OF THE ACT. HE, IN THIS RESPECT HAS RELIED UPON THE DECISION OF THE HON'BLE ALLAHABAD H IGH COURT IN THE CASE OF PRINCIPAL CIT VS. SHRISANDEEPCHANDAK AND ORS., IT A NO. 122 OF 2017 ORDER DATED 27.11.2017. 7. IN REBUTTAL, THE LD. AR HAS SUBMITTED THAT AS PE R THE PROVISIONS OF SECTION 274 OF THE ACT WHICH IS MADE APPLICABLE IN RELATION TO THE PENALTY REFERRED TO SECTION 271AAB, THE LEVY OF PENALTY IS NOT MANDATORY. HE, I N THIS RESPECT HAS RELIED UPON THE FOLLOWING DECISIONS OF THE COORDINATE BENCHES: - ACIT VS. MARVEL ASSOCIATES, ITA NO. 147/VIZAG/2017 ORDER DATED 16.3.2018 (ITAT VISAKHAPATNAM BENCH); DCIT VS. M/S RASHMI METALIKS LTD., ITA NO. 1608/KOL KATA/2017 DATED 1.2.2019; (ITAT KOLKATA BENCH); DCIT VS. RASHMI CEMENT LTD, ITA NO. 1606/KOLKATA/2 017 ORDER DATED 28.2.2019((ITAT KOLKATA BENCH). 8. WE HAVE CONSIDERED THE RIVAL CONTENTIONS OF THE LD. COUNSEL FOR THE PARTIES AND GONE THROUGH THE RECORD ALSO EXAMINED THE RELEVANT PROVISIONS OF THE ACT AND CASE LAWS ON THE ISSUE. FOR THE SAKE OF READY REFER ENCE, THE RELEVANT PROVISIONS OF SECTION 271AAB AND SECTION 274 OF THE INCOME TAX AC T ARE REPRODUCED AS UNDER: PENALTY WHERE SEARCH HAS BEEN INITIATED 271AAB: (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 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-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 UNDIS CLOSED INCOME WAS DERIVED; AND (III) ON OR BEFORE THE SPECIFIED DATE (A) PAYS THE TAX, TOGETHER WITH INTEREST, IF ANY, I N RESPECT OF THE UNDISCLOSED INCOME; AND (B) FURNISHES THE RETURN OF INCOME FOR THE SPECIFIE D PREVIOUS 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 5 (I) IN THE COURSE OF THE SEARCH, IN A STATEMENT UND ER SUB-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 FU RNISHED 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 TH E UNDISCLOSED INCOME REFERRED TO IN SUB-SECTION (1). (3) THE PROVISIONS OF SECTION 274 AND 275 SHALL, AS FAR AS MAY BE, APPLY IN RELATION TO THE PENALTY REFERRED TO IN THIS SECTION. EXPLANATION:--- FOR THE PURPOSE OF THIS SECTION,__ (A) (B). (C) 'UNDISCLOSED INCOME' MEANS (I) ANY INCOME OF THE SPECIFIED PREVIOUS YEAR REPRE SENTED, 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 TRANSACT IONS FOUND IN THE COURSE OF A SEARCH UNDER SECTION 132, WHICH HAS (A) NOT BEEN RECORDED ON OR BEFORE THE DATE OF SEAR CH IN 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 C HIEF COMMISSIONER OR CHIEF COMMISSIONER OR PRINCIPAL COMMISSIONER OR COMMISSIO NER BEFORE THE DATE OF SEARCH; OR (II) ANY INCOME OF THE SPECIFIED PREVIOUS YEAR REPR ESENTED, EITHER 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. SECTION 274 PROCEDURE 274 (1) NO ORDER IMPOSING A PENALTY UNDER THIS CHAPTER SHALL BE MADE UNLESS THE ASSESSEE HAS BEEN HEARD, OR HAS BEEN GIVEN A REASON ABLE OPPORTUNITY OF BEING HEARD. (2) NO ORDER IMPOSING A PENALTY UNDER THIS CHAPTER SHALL BE MADE- (A) BY THE INCOME- TAX OFFICER, WHERE THE PENALTY E XCEEDS TEN THOUSAND RUPEES; (B) BY THE ASSISTANT COMMISSIONER, WHERE THE PENALT Y EXCEEDS TWENTY THOUSAND RUPEES, EXCEPT WITH THE PRIOR APPROVAL OF THE DEPUT Y COMMISSIONER.] 6 (3) AN INCOME- TAX AUTHORITY ON MAKING AN ORDER UNDER THIS CHAPTER IMPOSING A PENALTY, UNLESS HE IS HIMSELF THE ASSESSING OFFICER , SHALL FORTHWITH SEND A COPY OF SUCH ORDER TO THE ASSESSING OFFICER. 9. IT IS PERTINENT TO MENTION HERE THAT CO-ORDINATE KOLKATA BENCH OF THE TRIBUNAL IN THE CASE OF M/S. RASHMI METALIKS LTD. (SUPRA) HAS EXTENSIVELY ANALYZED THE AFORESAID PROVISIONS OF SECTION 217AAB WHILE FURTHE R RELYING UPON THE DECISION OF THE VISAKHAPATNAM BENCH OF THE ITAT IN THE CASE OF ACIT VS. MARVEL ASSOCIATES(SUPRA) AND OTHER CASE LAWS. THE RELEVAN T PART OF THE SAID ORDER OF KOLKATA BENCH IS REPRODUCED AS UNDER: AT THE OUTSET WE NOTE THAT IT HAS BEEN THE SUBMIS SION OF THE AO AS WELL AS THE LD. DR THAT THE LEVY OF PENALTY UNDER SECTION 271AAB IS MANDATORY AND AUTOMATIC AND THEREFORE IN THE MATTER OF LEVY OF PENALTY THE AO HAD NO DISCRETION ONCE THE ASSESSEE ADMITS OF ANY UNDISCLOSED INCOME IN HIS ST ATEMENT U/S 132(4) OF THE ACT. SUCH A VIEW GOES AGAINST THE WORDS USED IN SECTION 271AAB AND SECTION 274 OF THE ACT. FOR SAYING SO WE NOTE THAT IF THE INTENTION OF THE LEGISLATURE TO LEVY THE PENALTY WAS MANDATORY AND AUTOMATIC THEN THE RIGHT OF APPEA L U/S 246A WOULD NOT HAVE BEEN PROVIDED FOR BY THE LEGISLATURE AGAINST THE OR DER OF PENALTY PASSED U/S 271AAB OF THE ACT. WE ALSO NOTE THAT WHILE ENACTING SECTION 271AAB THE LEGISLATURE HAS CONSCIOUSLY USED THE WORD MAY IN CONTRADISTINCTION TO THE WORD SHALL IN THE OPENING WORDS OF SECTION 271AAB OF T HE ACT. THE CHOICE OF THE EXPRESSION MAY AND NOT SHALL IN THE OPENING SEC TION OF 271AAB SHOWS THAT THE LEGISLATURE DID NOT INTEND TO MAKE THE LEVY OF PENA LTY STATUTORY, AUTOMATIC AND BINDING ON THE AO BUT THE AO WAS GIVEN DISCRETION I N THE MATTER OF LEVY OF PENALTY. OUR FOREGOING VIEW FINDS SUPPORT IN THE DE CISION OF THE COORDINATE BENCH OF THE TRIBUNAL AT VISHAKHAPATNAM IN THE CASE OF ACIT VS MARVEL ASSOCIATES (170 ITD 353) WHICH IN TURN RELIED ON HONBLE ANDHRA PRADESH HIG H COURT RATIO IN RADHA KRISHNA VIHAR (INFRA). THE FOLLOWING OBSERVATIONS O F THE TRIBUNAL IN THE SAID DECISION ARE RELEVANT IN THIS REGARD: 6. CAREFUL READING OF SECTION 271AAB OF THE ACT, T HE WORDS USED ARE 'AO MAY DIRECT' AND 'THE ASSESSEE SHALL PAY BY WAY OF PENAL TY'. SIMILAR WORDS ARE USED SECTION 158BFA(2) OF THE ACT. THE WORD MAY DIRECT I NDICATES THE DISCRETION TO THE AO. FURTHER, SUB SECTION (3) OF SECTION 271AAB OF T HE ACT, FORTIFIES THIS VIEW. . . 7. THE LEGISLATURE HAS INCLUDED THE PROVISIONS OF SECTION 274 AND SECTION 275 OF THE ACT IN 271AAB OF THE ACT WITH CLEAR INTENTION T O CONSIDER THE IMPOSITION OF PENALTY JUDICIALLY. SECTION 274 DEALS WITH THE PROC EDURE FOR 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 REASONA BLE OPPORTUNITY OF BEING HEARD. THEREFORE, FROM PLAIN READING OF SECTION 271 AAB OF THE ACT, IT IS EVIDENT THAT THE PENALTY CANNOT BE IMPOSED UNLESS THE ASSESSEE I S GIVEN A REASONABLE OPPORTUNITY AND ASSESSEE IS BEING HEARD. ONCE THE O PPORTUNITY IS GIVEN TO THE ASSESSEE, THE PENALTY CANNOT BE MANDATORY AND IT IS ON THE BASIS OF THE FACTS AND MERITS PLACED BEFORE THE A.O. ONCE THE A.O. IS BOUN D BY THE ACT TO HEAR THE ASSESSEE AND TO GIVE REASONABLE OPPORTUNITY TO EXPL AIN HIS CASE, THERE IS NO MANDATORY REQUIREMENT OF IMPOSING PENALTY, BECAUSE THE OPPORTUNITY OF BEING HEARD AND REASONABLE OPPORTUNITY IS NOT A MERE FORM ALITY BUT IT IS TO ADHERE TO THE PRINCIPLES OF NATURAL JUSTICE. HON'BLE A.P. HIGH CO URT IN THE CASE OF RADHAKRISHNAVIHAR IN ITTA NO.740/2011 WHILE DEALING WITH THE PENALTY U/S 158BFA HELD THAT 'WE ARE OF THE OPINION THAT WHILE THE WOR DS SHALL BE LIABLE UNDER SUB SECTION (1) OF SECTION 158BFA OF THE ACT THAT ARE E NTITLED 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 7 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. 9. AS FAR AS TO THE JUDGMENT OF THE HONBLE ALLAHA BAD HIGH COURT IN THE CASE OF PR. CIT VS SANDEEP CHANDAK (SUPRA) IS CONCERNED, WE NOT E THAT THE FACTS OF THE PRESENT CASE ARE DISTINGUISHABLE FROM THE FACTS INV OLVED IN THAT JUDGMENT. IN SANDEEP CHANDAK (SUPRA) THE ASSESSEE HAD NOT ONLY M ADE THE DISCLOSURE/SURRENDER OF THE AMOUNT BUT ALSO HAD SPE CIFIED THE MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED I.E. FROM THE TRADING OF F&O AND DERIVATIVES AND WAS ADVANCED FOR PURCHASE OF LAND. THAT IS NOT THE CASE IN THE PRESENT APPEAL; THERE IS NO EXPLANATION BY THE ASSESSEE THE MANNER OF DERIVING THE SURRENDER MADE DURING SEARCH. AS DISCUSSED IN THE FOREGOING, IT IS A MATTER OF RECORD THAT IN THE COURSE OF SEARCH NO UNDISCLOSED ASSET OR THING WAS FOUND NOR ANY INCRIMINATING MATERIAL WAS FOUND FROM WHICH ANY UNDISCLOSED INCOM E OR UNEXPLAINED EXPENDITURE COULD BE INFERRED. IN THE CIRCUMSTANCE S THE BALD OFFER MADE BY THE ASSESSEE TO PAY TAX ON ADDITIONAL INCOME IN THE STA TEMENT U/S 132(4) CANNOT BE CONSIDERED TO BE UNDISCLOSED INCOME WITHIN THE ME ANING OF SEC. 271AAB OF THE ACT. SO THE RIGORS OF SECTION 271AAB OF THE ACT IS NOT ATTRACTED. HAVING REGARD TO THESE MATERIAL FACTS THE JUDGMENT OF HONBLE ALLAHA BAD HIGH COURT RELIED UPON BY THE LD. DR, HAS NO APPLICATION IN THE FACTS OF THE INSTANT CASE. .. .. 11. SO FOR THE REASONS AS AFORERSTATED AND RE LYING ON THE HONBLE ANDHRA PRADESH HIGH COURT RATIO IN RADHA KRISHNA VIHAR (SU PRA), WE CANNOT AGREE WITH THE REVENUE THAT THE LEVY OF PENALTY UNDER SECTION 271A AB WAS MANDATORY AND AUTOMATIC. WE FURTHER NOTE THAT THE PENALTY LEVIABL E UNDER SECTION 271AAB MUST HAVE NECESSARY AND PROXIMATE NEXUS WITH DISCOVERY O F UNDISCLOSED INCOME IN THE COURSE OR AS A RESULT OF SEARCH. THE EXPRESSION UNDISCLOSED INCOME FOR THE PURPOSES OF LEVY OF PENALTY U/S 271AAB HAS A DEFINI TE AND SPECIFIC MEANING AND THE SAID WORD OR EXPRESSION DOES NOT HAVE ANY LOOSE OR COLLOQUIAL MEANING. UNLESS AND UNTIL INCOME OFFERED TO TAX BY AN ASSESSEE COME S WITHIN THE MISCHIEF OF UNDISCLOSED INCOME AND THAT TOO OF THE SPECIFIED PR EVIOUS YEAR IT IS NOT OPEN FOR THE AO TO INVOKE PROVISIONS OF SECTION 271AAB OF TH E ACT. . 12. FROM THE FOREGOING DEFINITION OF UNDISCLOS ED INCOME WE FIND THAT THIS EXPRESSION IS GIVEN A DEFINITE AND SPECIFIC MEANING AND THE WORD HAS NOT BEEN DESCRIBED IN AN INCLUSIVE MANNER SO AS TO ENABLE TH E TAX AUTHORITIES TO GIVE WIDER OR ELASTIC MEANING WHICH ENABLES THEM TO BRING WITH IN ITS AMBIT THE SPECIES OF INCOME NOT SPECIFICALLY COVERED BY THE DEFINITION. FROM BARE PERUSAL OF THE DEFINITION OF THE WORD UNDISCLOSED INCOME WE FIND THAT IN ORDER TO BRING A RECEIPT OR SPECIE OF INCOME WITHIN THE MEANING OF T HE SAID EXPRESSION, IT IS OBLIGATORY FOR THE AO TO DEMONSTRATE AND PROVE THAT THE INCOME IS REPRESENTED EITHER WHOLLY OR PARTLY BY ANY MONEY, BULLION, JEWE LLERY OR OTHER VALUABLE ARTICLE OR THING FOUND IN THE COURSE OF SEARCH U/S 132 AND WHI CH WAS NOT RECORDED ON OR BEFORE THE DATE OF SEARCH IN THE BOOKS OF ACCOUNTS OR OTHER DOCUMENTS MAINTAINED IN THE NORMAL COURSE RELATING TO SUCH PR EVIOUS YEAR OR OTHERWISE NOT DISCLOSED TO THE COMMISSIONER BEFORE THE DATE OF SE ARCH. FROM THE BARE PERUSAL OF THE ASSESSMENT ORDER AND THE PENALTY ORDER, WE NOTE THAT THE ASSESSEE HAD VOLUNTARILY INCLUDED RS.69 CRORES AS ITS INCOME FOR AY 2013-14. WE HOWEVER FIND THAT NOTHING HAS BEEN BROUGHT ON RECORD BY THE AO WHICH IN ANY MANNER EVEN SUGGESTED LET ALONE PROVED WITH COGENT MATERIAL THA T THE SAID INCOME WAS ACTUALLY REPRESENTED EITHER WHOLLY OR PARTLY BY ANY SUM OF MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING AND WHICH WAS FO UND IN THE COURSE OF SEARCH. SINCE NO SUM OF MONEY, BULLION, VALUABLE OR ARTICLE EQUIVALENT TO RS.69 CRORES WAS DISCOVERED BY THE REVENUE IN THE COURSE OF SEARCH, THE ADDITIONAL REQUIREMENT OF THE SAME BEING FOUND NOT RECORDED IN THE BOOKS OR O THER DOCUMENTS WAS REDUNDANT. WE THEREFORE FIND THAT THE CONDITIONS PR ESCRIBED IN FIRST LIMB OF CLAUSE 8 (I) OF CLAUSE (C) OF EXPLANATION WERE NOT SATISFIED . 13. THE SECOND LIMB OF SUB-CLAUSE (I) PROVIDES THAT UNDISCLOSED INCOME SHALL MEAN ANY INCOME REPRESENTED EITHER WHOLLY OR PARTLY BY ANY ENTRY IN THE BOOKS OF ACCOUNTS OR OTHER DOCUMENTS OR TRANSACTIONS FOUND I N THE COURSE OF SEARCH UNDER SECTION 132 BUT WHICH WERE NOT RECORDED ON OR BEFOR E THE DATE OF SEARCH IN THE BOOKS OF ACCOUNTS OR OTHER DOCUMENTS MAINTAINED IN THE NORMAL COURSE RELATING TO SUCH PREVIOUS YEAR OR OTHERWISE NOT BEEN DISCLOS ED TO THE COMMISSIONER BEFORE THE DATE OF SEARCH. WE FIND THAT EVEN IN RESPECT OF THE SECOND LIMB NO MATERIAL OR EVIDENCE HAS BEEN BROUGHT ON RECORD BY THE AO WHICH SHOWED THAT THE INCOME OF RS.69 CRORES WAS REPRESENTED BY ANY ENTRY IN THE BOOKS OF ACCOUNTS OR OTHER DOCUMENTS OR TRANSACTIONS FOUND IN THE COURSE OF SE ARCH. .. .. 14. FROM THE FOREGOING FINDINGS RECORDED BY THE AO IN PARA 7 OF THE ASSESSMENT ORDER, WE FIND THAT SAVE & EXCEPT MAKING REFERENCE TO THE VOLUNTARY OFFER MADE THROUGH JOINT DECLARATION PETITION DATE D 18.04.2013, THE AO HAD NOT BROUGHT ON RECORD ANY INCRIMINATING MATERIAL FOUND IN THE COURSE OF SEARCH FROM WHICH ONE COULD INFER THAT THE INCOME OF RS.69 CROR ES WAS REPRESENTED IN PART OR WHOLE BY ANY ENTRY MADE IN THE BOOKS OF ACCOUNTS OR OTHER DOCUMENTS OR TRANSACTIONS FOUND IN THE COURSE OF SEARCH. . 15. FROM THE FOREGOING FINDINGS OF THE AO, WE N OTE THAT IN THE ASSESSMENT ORDER U/S 143(3), THE AO HAD ADMITTED THAT THE ASSE SSEE HAD SATISFACTORILY EXPLAINED THE CONTENTS OF THE DOCUMENTS IDENTIFIED AS RASHMI/1 TO RASHMI/5 AND RCPL/1 TO RCPL/7 AND THERE WAS NO FINDING IN THE SA ID ASSESSMENT ORDER WHICH IN ANY MANNER EVEN SUGGESTED LET ALONE PROVED THAT THE INCOME OF RS.69 CRORES OFFERED BY THE ASSESSEE IN ITS RETURN OF INCOME WAS RELATABLE TO OR REPRESENTED BY THE ENTRIES MADE IN DOCUMENTS IDENTIFIED AS RASHMI/ 1 TO RASHMI/5 AND RCPL/1 TO RCPL/7. IN THE COURSE OF APPELLATE HEARING THE FOR EGOING SUBMISSION OF THE LD. AR WENT UN-REBUTTED FROM THE LD. DR WHO COULD NOT BRIN G TO OUR ATTENTION ANY SPECIFIC NOTING IN THE SAID DOCUMENTS FROM WHICH IT COULD BE CONSTRUED THAT THE INCOME DISCLOSED WAS RELATABLE TO DOCUMENTS SEIZED IN THE COURSE OF SEARCH. .. ..16. FROM THE FOREGOING DISCUSSION AND MATERIAL ON RECORD, WE FIND THAT APPLYING BOTH THE LIMBS CONTAINED IN CLAUSE (C) OF EXPLANATION TO SECTION 271AAB, THE ADDITIONAL INCOME OF RS.69 CRORES OFFERED BY TH E ASSESSEE THROUGH ITS JOINT DECLARATION WAS NEITHER REPRESENTED BY ANY ASSETS F OUND IN THE COURSE OF SEARCH NOR REPRESENTED BY ANY ENTRY MADE IN THE BOOKS OF A CCOUNTS OR OTHER DOCUMENTS OR TRANSACTIONS FOUND IN THE COURSE OF SEARCH. WE T HEREFORE FIND THAT THE INCOME VOLUNTARILY OFFERED BY THE ASSESSEE DID NOT COME WI THIN THE AMBIT AND SCOPE OF THE EXPRESSION UNDISCLOSED INCOME AS DEFINED FOR THE PURPOSES OF SECTION 271AAB OF THE ACT. 17. FROM THE PLAIN READING OF SECTION 271AAB WE FIN D THAT THE LEVY OF PENALTY IS PERMISSIBLE IF AND ONLY IF THERE EXISTS UNDISCLOSE D INCOME. FINDING OR UNEARTHING OF UNDISCLOSED INCOME IN THE COURSE OR AS A RESULT OF SEARCH CONDUCTED U/S 132 OF THE ACT IS SINE QUA NON FOR INVOKING PENAL PROVISIONS O F SECTION 271AAB OF THE ACT. DISCOVERY AND CONSEQUENT ASSESSMENT OF UNDISCLOSED INCOME IS A CONDITION PRECEDENT FOR LEVY OF PENALTY UNDER SECTION 271AAB OF THE ACT. IT HAS TO BE BORNE IN MIND THAT EVERY OFFER OF THE ASSESSEE TO PAY TAX ON HIS OR HER INCOME IN THE COURSE OF RECORDING OF STATEMENT U/S 132 DOES NOT A MOUNT TO FINDING OF UNDISCLOSED INCOME. A MERE OFFER OR DISCLOSURE BY AN ASSESSEE TO PAY TAX ON SOME ADDITIONAL AMOUNT WITH A VIEW TO AVOID PROTRAC TED LITIGATION CANNOT AND DOES NOT AMOUNT TO DISCOVERY OF UNDISCLOSED INCOME FOR THE PURPOSES OF LEVY PENALTY U/S 271AAB OF THE ACT. THE LEGISLATURE HAS ALL ALONG BEEN CONSCIOUS IN 9 PROVIDING FOR LEVY OF PENALTY ONLY IN RESPECT OF U NDISCLOSED INCOME. WE FIND THAT IN ALL PENAL PROVISIONS SUCH AS EXPLANATION 5A OF S ECTION 271(1)(C), SECTION 271AAA & SECTION 271AAB, THE LEGISLATURE HAS RESTRICTED TH E SCOPE OF PENAL PROVISION ONLY TO UNDISCLOSED INCOME AND NOT ASSESSED TOTAL INCO ME. MOREOVER THE TERM/EXPRESSION UNDISCLOSED INCOME HAS BEEN DEFIN ED BY THE LEGISLATURE IN ALL SUCH PENAL PROVISIONS IN A SPECIFIC AND RESTRICTED MANNER AND NOT IN AN INCLUSIVE MANNER. FOR THAT REASON THE DEFINITION OF UNDISCLOS ED INCOME NOWHERE PROVIDES THAT THE SAID EXPRESSION SHALL INCLUDE ALL AND EV ERY SPECIES OF INCOME BUT THE WORD USED IS UNDISCLOSED INCOME MEANS. THE CONSCI OUS USE OF THE EXPRESSION MEANS IN CONTRADISTINCTION TO THE USE OF WORD IN CLUDES INDICATE THAT THE LEGISLATURE INTENDED TO RESTRICT THE SCOPE OF PENAL PROVISIONS ONLY TO INCOME WHICH CAME WITHIN THE KEN OF THE SAID EXPRESSION AND NOT BEYOND. APPLYING THE DEFINITION OF UNDISCLOSED INCOME TO THE INCOME OF R S.69 CRORES, WE FIND THAT SUCH INCOME WAS OFFERED IN THE STATEMENT RECORDED U/S 13 2(4) OF THE ACT AT THE TIME OF SEARCH. HOWEVER ONLY FOR THE SAID REASON, IT COULD NOT BE BROUGHT WITHIN THE AMBIT OF UNDISCLOSED INCOME PARTICULARLY WHEN SUCH INCOME WAS NOT REPRESENTED BY ANY VALUABLE ASSET OR ENTRY IN BOOKS OF ACCOUNTS OR WHI CH WAS NOT FOUND AS A RESULT OF SEARCH NOT RECORDED IN THE BOOKS. WE THEREFORE FIND MUCH FORCE IN THE LD. ARS ARGUMENTS THAT SINCE THE SUM OF RS.69 CRORES VOLUNT ARILY OFFERED TO TAX WAS NOT IN THE NATURE OF UNDISCLOSED INCOME, THE LEVY OF PENAL TY U/S 271AAB WAS UNSUSTAINABLE. 18. IN THIS REGARD WE RELY ON THE DECISION OF THE C OORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF ACIT VS KANWAR SAIN GUPTA IN ITA NO.538 /KOL/2017 DATED 29.06.2018 INVOLVING SIMILAR SET OF FACTS AND CIRCUMSTANCES. I N THE INSTANT CASE ALSO THE ASSESSEE HAD VOLUNTARILY OFFERED SUM OF RS.1,00,00, 000/- TO TAX IN HIS STATEMENT U/S 132(4) WITHOUT ANY PROOF OF CONCEALMENT. THE AO ASS ESSED SUCH SUM TO TAX SOLELY BASED ON THE ASSESSEES DISCLOSURE PETITION AND THE RE WAS NO MATERIAL BROUGHT ON RECORD TO INDICATE THAT IT WAS REPRESENTED BY ANY V ALUABLE ASSET OR ANY ENTRY FOUND IN ANY BOOKS OR OTHER DOCUMENTS SEIZED IN THE COURSE OF SEARCH. THE AO THEREAFTER ALSO LEVIED PENALTY U/S 271AAB @ 10% WHI CH WAS DELETED BY LD. CIT(A). ON APPEAL THIS TRIBUNAL UPHELD THE ORDER OF LD. CIT (A) BY OBSERVING AS UNDER: 4. LEARNED DEPARTMENTAL REPRESENTATIVE ARGUED THAT THE ASSESSING OFFICER HAD RIGHTLY IMPOSED THE IMPUGNED PENALTY IN ASSESSEES CASE @10% OF HIS UNDISCLOSED INCOME OF RS.1 CRORE COMING RS.10,00,000 IN QUESTIO N. WE FIND NO SUBSTANCE IN REVENUES INSTANT ARGUMENTS. WE FIRST OF ALL MAKE I T CLEAR THAT SECTION 271AAB OF THE ACT APPLIES IN RELATION TO THE IMPUGNED PENALTY @10% OF THE UNDISCLOSED INCOME AS STOOD DEFINED IN EXPLANATION (C) THERETO. THERE IS NO MATERIAL IN THE CASE FILE TO INDICATE THAT THE ASSESSEES UNDISCLOS ED INCOME REPRESENTS ANY MONEY, BULLION, JEWELLERY OR VALUABLE ARTICLE OR AN Y ENTRY IN THE BOOKS OR OTHER DOCUMENTS THEREIN. WE MAKE IT CLEAR THAT WE ARE DEA LING WITH A PENALTY PROVISION IN TAX STATUTE WHICH IS TO BE STRICTLY INTERPRETED. WE THEREFORE ARE OF THE OPINION THAT THE CIT(A) HAS RIGHTLY DELETED THE IMPUGNED PE NALTY AS THE ASSESEES SEARCH STATEMENT NOWHERE INDICATED THE CORRESPONDING UNDIS CLOSED INCOME AS PER SPECIFIC REQUIREMENT IN THE ACT. THE CIT(A)S FINDI NGS UNDER CHALLENGE DELETING PENALTY IN QUESTION ARE ACCORDINGLY CONFIRMED. 19. WE ALSO RELY ON THE DECISION OF THIS COORDINATE BENCH OF TRIBUNAL IN THE CASE OF DCIT VS LILADHAR AGARWAL IN ITA NO. 1605/KOL/2017 D ATED 26.12.2018 WHEREIN IDENTICAL ISSUE HAD COME UP FOR CONSIDERATION AND T HE TRIBUNAL UPHELD THE CIT(A)S ORDER DELETING THE LEVY OF PENALTY SINCE THERE WAS NO MATERIAL TO SUGGEST THAT THE INCOME OFFERED TO TAX WAS A CONSEQUENCE OF ANY VA LUABLE ASSET OR ANY ENTRY FOUND IN ANY BOOKS OR OTHER DOCUMENTS SEIZED IN THE COURSE OF SEARCH. . 20. WE MAY ALSO REFER TO THE DECISION OF THE COORDI NATE BENCH OF THE TRIBUNAL AT VISHAKHAPATNAM IN THE CASE OF ACIT VS MARVEL ASSOCI ATES (SUPRA) WHEREIN IT WAS 10 HELD AS FOLLOWS: 9. PENALTY U/S 271AAB ATTRACTS ON UNDISCLOSED INCO ME BUT NOT ON ADMISSION MADE BY THE ASSESSEE U/S 132(4). THE AO MUST ESTABL ISH THAT THERE IS UNDISCLOSED INCOME ON THE BASIS OF INCRIMINATING MATERIAL. IN T HE INSTANT CASE A LOOSE SHEET WAS FOUND ACCORDING TO THE A.O., IT WAS INCRIMINATING M ATERIAL EVIDENCING THE UNDISCLOSED INCOME. IN THE PENALTY ORDER THE AO OBS ERVED THAT LOOSE SHEET SHOWS THE COST PER SQUARE FEET IS RS.3571/- PER SFT. AND ASSESSEE STATED TO HAVE SUBMITTED IN SWORN STATEMENT COST PER SQ. FEET AT RS.2200/- T O RS.2300/- PER SQ. FEET. HOWEVER NEITHER THE AO NOR THE LD.CIT(A) HAS VERIFIED THE C OST OF CONSTRUCTION WITH THE BOOKS AND PROJECTIONS FOUND AT THE TIME OF SEARCH. THE COUNSEL ARGUED THAT IT WAS MERE PROJECTION BUT NOT THE ACTUALS. THE WRITE UP H EADING ALSO MENTIONED THAT SUMMARY OF THE PROJECTED PROFITABILITY STATEMENT. T HERE IS NO EVIDENCE TO ESTABLISH THAT PROJECTIONS REFLECTED IN THE LOOSE SHEET IS RE AL. NO OTHER MATERIAL WAS FOUND DURING THE COURSE OF SEARCH INDICATING THE UNDISCLO SED INCOME. THERE WAS NO MONEY, BULLION, JEWELLERY OR VALUABLE ARTICLE OR TH ING OR ENTRY IN THE BOOKS OF ACCOUNTS OR DOCUMENTS TRANSACTIONS WERE FOUND DURIN G THE COURSE OF SEARCH INDICATING THE ASSETS NOT RECORDED IN THE BOOKS OF ACCOUNTS OR OTHER DOCUMENTS MAINTAINED IN THE NORMAL COURSE, WHOLLY OR PARTLY. THE REVENUE DID NOT FIND ANY UNDISCLOSED ASSET, ANY OTHER UNDISCLOSED INCOME OR THE INFLATION OF EXPENDITURE DURING THE SEARCH/ ASSESSMENT PROCEEDINGS. THOUGH A LOOSE SHEET OF PAGE NO.107 OF ANNEXURE A/GS/MA/1 WAS FOUND THAT DOES NOT INDIC ATE ANY SUPPRESSION OF INCOME BUT IT IS ONLY PROJECTION OF PROFIT STATEMEN T. THE AMOUNT OF RS.3571/- MENTIONED IN THE PROJECTIONS REFERS TO COST AND PRO FIT WHICH IS APPROXIMATE SALE PRICE BUT NOT THE COST AS STATED BY THE AO IN THE P ENALTY ORDER. THE COST OF CONSTRUCTION IN THE PROJECTIONS PROJECTED AT RS.217 7/- WHICH IS IN SYNCH WITH THE STATEMENT GIVEN BY THE ASSESSEE. THE AO WAS HAPPY W ITH THE DISCLOSURE GIVEN BY THE ASSESSEE AND DID NOT VERIFY THE FACTUAL POSITIO N WITH THE BOOKS OF ACCOUNTS AND PROJECTIONS AND BRING THE EVIDENCE TO UNEARTH T HE UNDISCLOSED INCOME. NEITHER THE A.O. NOR THE INVESTIGATION WING LINKED THE COST OF PROFIT OR COST OF ASSET TO THE ENTRIES IN THE BOOKS OF ACCOUNTS OR TO THE S ALES CONDUCTED BY THE ASSESSEE TO THE SALE DEEDS. THEREFORE, WE ARE UNABLE TO ACCE PT THE CONTENTION OF THE REVENUE THAT THE LOOSE SHEET FOUND DURING THE COURS E OF SEARCH INDICATES ANY UNDISCLOSED INCOME OR ASSET OR INFLATION OF EXPENDI TURE. THE HON'BLE ITAT DELHI BENCH IN THE CASE OF AJAY SHARMA V. DY. CIT [2013] 30 TAXMANN.COM 109 HELD THAT WITH RESPECT TO THE ADDITION ON ACCOUNT OF ALLEGED RECEIVABLES AS PER SEIZED PAPER, THERE IS NO DIRECT MATERIAL WHICH LEADS AND ESTABLISHES THAT ANY INCOME RECEIVED BY THE ASSESSEE HAS NOT BEEN DECLARED BY T HE ASSESSEE. AN ADDITION HAS BEEN MADE ON THE BASIS OF LOOSE DOCUMENT, WHICH DID NOT CLOSELY PROVE ANY CONCEALMENT OR FURNISHING OF INACCURATE PARTICULARS BY THE ASSESSEE. HENCE PENALTY U/S 158BFA (2) OF THE ACT IS NOT LEVIABLE. THE FACTS OF THE ASSESSEE'S CASE SHOWS THAT THERE W AS NO UNDISCLOSED INCOME FOUND DURING THE COURSE OF SEARCH AND NO INCRIMINAT ING MATERIAL WAS FOUND, HENCE WE HOLD THAT THERE IS NO CASE FOR IMPOSING PE NALTY U/S 271AAB OF THE ACT, ACCORDINGLY, WE SET ASIDE THE ORDER OF THE LOWER AU THORITIES AND CANCEL THE PENALTY U/S 271AAB OF THE ACT. 10. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. 21. USEFUL REFERENCE IN THIS REGARD MAY ALSO BE MAD E TO THE DECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL AT JAIPUR IN THE CASE OF SHRI DINESH KUMAR AGARWAL VS. ACIT IN ITA NO. 855 & 856/JP/2017 DATED 24/07/2018 WHEREIN IT WAS HELD AS FOLLOWS: 18. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WE LL AS RELEVANT MATERIAL ON 11 RECORD. AT THE OUTSET, WE NOTE THAT THE SURRENDER O F RS. 1,65,38,920/- WAS MADE BY THE ASSESSEE DURING THE COURSE OF SEARCH AND SEIZUR E PROCEEDINGS AND OFFERED TO TAX FOR THE YEAR UNDER CONSIDERATION. THE DETAILS O F THE SURRENDERED INCOME PERTAINS TO THE YEAR UNDER CONSIDERATION ARE AS UND ER:- ON ACCOUNT OF DEBTORS (ADVANCES GIVEN) RS. 80,00,00 0/- UNEXPLAINED CASH FOUND RS. 10,00,000/- ACCRUED INTEREST ON DEBTORS RS. 20,00,000/- EXCESS STOCK FOUND DURING SEARCH RS. 55,38, 920/- TOTAL RS. 1,65,38,920/- WE FIND THAT OUT OF THESE FOUR ITEMS OF SURRENDERS ONLY ADVANCES OF RS. 80,00,000/- IS BASED ON THE INCRIMINATING MATERIAL AND ALL OTHER I TEMS ARE NOT BASED ON THE SEIZED MATERIAL. THE INTEREST ON ADVANCES/ DEBTORS IS ONLY AN ESTIMATED AMOUNT DISCLOSED DURING THE YEAR BUT NO RECORD OR ANY DOCU MENT WAS FOUND DURING THE SEARCH AND SEIZURE ACTION. AS REGARDS THE EXCESS ST OCK WE FIND FROM THE RECORD AS PRODUCED BEFORE US BY THE LD. DR THAT THE VALUATION REPORT IS BASED ON THE MARKET PRICE OF THE GOLD JEWELLERY PREVAILING ON THE DATE OF SEARCH AS AGAINST THE COST OR REALIZATION WHEREVER IS LESS. THEREFORE, THE COMPUT ATION OF EXCESS STOCK BASED ON THE MARKET PRICE OF THE STOCK CANNOT BE CONSIDERED AS UNDISCLOSED INCOME OF THE ASSESSEE AS IT IS THE SUBJECT MATTER OF REGULAR ASS ESSMENT AND CANNOT BE REGARDED AS UNDISCLOSED INCOME BASED ON INCRIMINATING MATERI AL. THERE IS NO SUCH FACT EITHER RECORDED DURING THE SEARCH AND SEIZURE PROCE EDING OR IN THE ASSESSMENT ORDER OR IN THE PENALTY PROCEEDING TO SHOW THAT THE RE WAS DISCREPANCY IN THE STOCK AS RECORDED IN THE BOOKS OF ACCOUNT AND FOUND AT THE TIME OF SEARCH. IN THE ABSENCE OF ANY DISCREPANCY IN THE QUANTITY OF STOCK THE VALUATION OF THE STOCK IS PURELY A QUESTION OF ASSESSMENT AND CANNOT BE HELD AS UNDISCLOSED INCOME DETECTED DURING THE COURSE OF SEARCH AND SEIZURE PR OCEEDING. THEREFORE, TO THE EXTENT OF EXCESS STOCK BASED ON THE VALUATION REPOR T THE DISCLOSURE OF THE INCOME BY THE ASSESSEE WOULD NOT FALL IN THE CATEGORY OF U NDISCLOSED INCOME AS PER EXPLANATION TO SECTION 271AAB OF THE ACT. IT IS NOT THE CASE OF THE REVENUE THAT ANY STOCK OF JEWELLERY WAS FOUND WHICH IS NOT RECOR DED IN THE BOOKS OF ACCOUNT BUT THE VALUE OF STOCK IS COMPUTED BASED ON THE VAL UATION REPORT OF THE DEPARTMENTAL VALUER. ONCE THE DIFFERENCE IN THE VAL UE OF STOCK IS ONLY DUE TO MARKET PRICE AS AGAINST THE COST OF THE SAID STOCK, THE SAME WILL NOT FALL IN THE AMBIT OF UNDISCLOSED INCOME AS DEFINED UNDER CLAUSE -(C) OF EXPLANATION -1 OF SECTION 271AAB OF THE ACT. 19. SIMILARLY THE ACCRUED INTEREST OF RS. 20,00,000 /- IS ALSO ONLY ESTIMATED AND NOT BASED ON ANY INCRIMINATING DOCUMENTS. THIS AMOUNT W AS ESTIMATED AS THERE WERE ADVANCES AS PER THE ENTRIES OF THE SEIZED MATERIAL. EVEN OTHERWISE ACCRUED INTEREST IS DEPENDENT ON THE OUTCOME OF THE LEVY OF PENALTY IN RESPECT OF ADVANCES GIVEN BY THE ASSESSEE. WE HAVE CONSIDERED THE ISSUE OF ADVANCES FOR THE ASSESSMENT YEAR 2013-14 AND ACCORDINGLY IN VIEW OF OUR FINDING ON THE SAID ISSUE THE PENALTY U/S 271AAB OF THE ACT IS NOT SUST AINABLE IN RESPECT OF THE SURRENDER AMOUNT OF RS. 1,65,38,920/-. 22. WE ALSO RELY ON THE DECISION OF THE COORDINATE BENCH AT RANCHI IN THE CASE OF RINKU AGARWAL IN ITA NO. 262/RAN/2017 DATED 30.11.2 018. IN THE INSTANT CASE AS WELL IN THE COURSE OF SEARCH OPERATIONS CONDUCTED AT THE MICA MOD GROUP ON 21.11.2012, THE ASSESSEE HAD ADMITTED ADDITIONAL IN COME OF RS.5,00,000/- U/S 132(4) WHICH SHE HAD OFFERED TO TAX IN HER RETURN O F INCOME. THE AO LEVIED PENALTY 12 U/S 271AAB ON SUCH ADDITIONAL INCOME OFFERED TO TAX . THE TRIBUNAL NOTED THAT NEITHER THE INVESTIGATION WING IN THE POST SEARCH N OR DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER FOUND ANY INCRIMINATING EVIDENCE OF UNDISCLOSED INCOME OTHERWISE THE DECLARATION OF THE ASSESSEE FOR MAKING THE ADDITION. FOLLOWING THE DECISION RENDERED IN THE CA SE OF ACIT VSKANWARSAIN GUPTA (SUPRA), THE TRIBUNAL DELETED THE PENALTY LEVIED U/ S 271AAB OF THE ACT. 23. RESPECTFULLY FOLLOWING THE DECISIONS IN THE FOR EGOING AND HAVING REGARD TO OUR FINDING THAT THE INCOME OF RS.69 CRORES VOLUNTARILY OFFERED TO TAX WAS NOT IN THE NATURE OF UNDISCLOSED INCOME DEFINED IN CLAUSE (C ) OF EXPLANATION TO SECTION 271AAB, WE HOLD THAT THE LD. CIT(A) WAS JUSTIFIED I N CANCELLING THE PENALTY LEVIED U/S 271AAB OF THE ACT. ACCORDINGLY THE ORDER OF THE LD. CIT(A) IS UPHELD FOR THE REASONS DISCUSSED ABOVE AND THE REVENUES APPEAL ST ANDS REJECTED. 10. NOW COMING TO THE FACTS OF THE CASE BEFORE US, THE ASSESSEE IN THIS CASE HAS SURRENDERED AS TOTAL INCOME OF RS. 14,39,99,158/- DURING THE SEARCH ACTION CARRIED OUT AT HIS PREMISES U/S 132 OF THE ACT, OUT OF WHIC H RS. 14 CRORES WAS SURRENDERED TO COVER ANY DISALLOWANCE OF EXPENSES/ADDITIONS, WHERE AS, THE REMAINING AMOUNT OF RS. 39,99,158/- WAS SURRENDERED REPRESENTING PROFI T EARNED ON STOCK FOUND SHORT. THEREAFTER THE ASSESSEE FILED ITS RETURN OF INCOME AND DULY INCLUDED THE SURRENDERED AMOUNT IN ITS INCOME FOR THE PURPOSE OF TAXATION. THE ASSESSING OFFICER CARRIED OUT THE ASSESSMENT PROCEEDINGS U/S 143(3) OF THE ACT AND INDEPENDENTLY SCRUTINIZED AND VERIFIED THE DIFFERENT HEADS OF INC OME AND EXPENDITURE AND COMPUTED THE ADDITIONAL INCOME OF RS. 33,13,304/- O N ACCOUNT OF STOCK FOUND SHORT DURING SEARCH ACTION, HOWEVER, GIVING THE ASS ESSEE SET OFF OF AMOUNT OF RS. 39,99,158/- SURRENDERED UNDER THE HEAD PROFIT ON S TOCK FOUND SHORT ADDED THE BALANCE AMOUNT OF RS. 2,58,20,577/- INTO THE INCOME OF THE ASSESSEE ON ACCOUNT OF STOCK FOUND SHORT DURING THE SEARCH ACTION. APAR T FROM THAT, THE ASSESSING OFFICER HAD MADE THE ADDITIONAL DISALLOWANCE OF RS.2,83,98, 545/- UNDER SECTION 14A OF THE ACT WHICH WAS IN ADDITION TO THE SUOMOTU DISALLOWA NCE OF RS. 3,45,49,868/- RETURNED BY THE ASSESSEE IN THIS RESPECT IN HIS INC OME TAX RETURN. THE ASSESSING OFFICER ALSO MADE AN ADDITION OF RS.2,25,54,011/- U /S 36 (1)(III) OF THE ACT. THOUGH THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS SUBM ITTED THAT THE SET OFF OF RS.14 CRORES DECLARED ON ACCOUNT OF DISALLOWANCE BY THE A SSESSEE OF EXPENSES/ADDITIONS BE GIVEN TO THE ASSESSEE, HOWEVE R, THE ASSESSING OFFICER REJECTED THE ABOVE CONTENTION OF THE ASSESSEE SINCE THE ASSESSEE HAD NOT GIVEN ANY BIFURCATION OF ANY SURRENDERED INCOME OF RS. 14 CRORES. APART FROM THAT, THE ASSESSING OFFICER HAS MADE AN ADDITION OF RS. 9,23, 231/- U/S 36(1) (V) OF THE INCOME TAX ACT AND ASSESSED THE TOTAL INCOME AT A LOSS OF RS. 33,73,75,950/- AS AGAINST THE LOSS DECLARED / RETURNED BY THE ASSESSEE AT RS. 41, 50,72,313/-. 11. THE RELEVANT FACT IN THIS CASE IS THAT THOUGH T HE ASSESSING OFFICER EXAMINED INDIVIDUALLY EACH AND EVERY ITEM OF INCOME AND EXPE NDITURE AND MADE SEPARATE DISALLOWANCES, HOWEVER, THE ASSESSING OFFICER DID N OT POINT OUT ANY EXCESS OR WRONG EXPENDITURE CLAIMED SO FAR AS THE SURRENDER O F RS. 14 CRORES ON ACCOUNT OF DISALLOWANCE OF EXPENDITURE / ADDITION WAS CONCERNE D. EVEN THE ASSESSING OFFICER DID NOT ALLOW THE TELESCOPIC BENEFIT / SET OFF OF T HE AMOUNT SURRENDERED AS AGAINST THE DISALLOWANCE MADE BY THE ASSESSING OFFICER UNDE R THE PROVISIONS OF SECTION 40A, 36 (1)(III) AND 36 (1)(V) OF THE ACT. THERE IS NO MENTION IN THE ASSESSMENT ORDER THAT THE ASSESSEE HAD CLAIMED ANY EXTRA OR INADMISS IBLE EXPENDITURE IN RESPECT OF ANY OTHER ITEM. IT ALSO APPARENT FROM THE FACTS ON THE FILE THAT EVEN DURING THE SEARCH ACTION, NO INCRIMINATING MATERIAL IN RESPECT OF EXCESSIVE OR INADMISSIBLE EXPENDITURE WAS FOUND DURING THE SEARCH ACTION. THE ASSESSEE SIMPLY SURRENDERED THE AMOUNT OF RS. 14,39,99,158/- AND IN THE BIFURCA TION OFFERED RS. 39.99 LACS TOWARDS PROFITS OF STOCK FOUND SHORT AND REMAINING AMOUNT OR RS. 14 CRORES WAS SURRENDERED ON ACCOUNT OF DISALLOWANCE OF EXPENSES/ ADDITION. HOWEVER, NEITHER DURING THE SEARCH ACTION NOR DURING THE ASSESSMENT PROCEEDINGS, NO SUCH 13 DISALLOWANCE OF EXPENDITURE AND CONSEQUENT ADDITION HAS BEEN MADE EXCEPT AS DISCUSSED ABOVE. HOWEVER, THE ASSESSING OFFICER HAS ADDED THE AFORESAID DISALLOWANCE MADE BY HIM SEPARATELY INTO THE INCOME OF THE ASSESSEE. SO FAR AS THE DISALLOWANCE U/S 14A IS CONCERNED, THE ASSESSEE HAD TAKEN A PLEA BEFORE THE ASSESSING OFFICER THAT IT DID NOT EARN ANY TAX-EXEM PT INCOME DURING THE YEAR. FURTHERMORE, THAT INVESTMENTS WERE MADE OUT OF ITS OWN / INTEREST FREE FUNDS AVAILABLE WITH THE ASSESSEE AND THAT NO DISALLOWANC E U/S 14A OF THE ACT WAS WARRANTED. SIMILAR PLEA WAS ALSO TAKEN BY THE ASSES SEE IN RESPECT OF DISALLOWANCE MADE U/S 36(1)(III) OF THE ACT THAT THE ADVANCES/IN VESTMENTS WERE MADE BY THE ASSESSEE OUT OF ITS OWN/INTEREST FREE FUNDS AVAILAB LE WITH IT. A PLEA WAS ALSO TAKEN THAT THE ADVANCES WERE GIVEN OUT OF COMMERCIAL EXPE DIENCY. SO FAR AS THE DISALLOWANCE U/S 36(1)(V) WAS CONCERNED, A PLEA WAS TAKEN THAT THE CONTRIBUTION TO EMPLOYEES PROVIDENT FUND WAS MADE WITHIN THE STI PULATED PERIOD AND THAT NO DISALLOWANCE WAS ATTRACTED. 12. CONSIDERING THE NATURE OF DISALLOWANCE MADE BY THE ASSESSING OFFICER AND THE PLEA OF THE ASSESSEE, IT IS QUITE APPARENT THAT TH E ISSUE OF DISALLOWANCE OF EXPENDITURE ON THE AFORESAID THREE ISSUES WAS A DE BATABLE ONE AND IN FACT IN THE LIGHT OF THE VARIOUS DECISIONS OF THE HON'BLE HIGH COURTS, THE ASSESSEE HAS A FAIR CASE ON MERITS AND THAT IT CANNOT BE SAID THAT THER E WAS ANY INTENTIONAL ACT ON THE PART OF THE ASSESSEE TO CLAIM ANY INADMISSIB LE EXPENDITURE, RATHER, THE ASSESSEE HAD PUT A BONAFIDE CLAIM OF THE ALLOWANCE /EXPENDITURE ON THESE ISSUES. WHAT WE WISH TO CONVEY THROUGH THE AFORESAID DISCUS SION IS THAT EVEN DESPITE CERTAIN DISALLOWANCES MADE BY THE ASSESSING OFFICER , AS DISCUSSED ABOVE, IT CANNOT BE SAID THAT ASSESSEE HAD CLAIMED ANY INADMI SSIBLE EXPENDITURE WHICH WOULD FALL WITHIN THE DEFINITION OF UNDISCLOSED IN COME AS DEFINED UNDER THE PROVISIONS OF SECTION 271AAB OF THE ACT. EXCEPT THE AFORESAID DISALLOWANCE MADE BY THE ASSESSING OFFICER ON DEBATABLE ISSUES, THERE IS NO CASE OF THE DEPARTMENT IN RESPECT OF ANY INADMISSIBLE EXPENDITURE CLAIMED BY THE ASSESSEE WHICH WOULD COVER THE SURRENDERED INCOME OF RS. 14 CORES. FROM THE FACTS ON THE FILE, IT IS ESTABLISHED THAT THE AFORESAID SURRENDER OF RS. 14 CRORES WAS BASED ON THE MERE STATEMENT OF THE ASSESSEE AND NOTHING INCRIMINATING MATERIAL WHICH WOULD CONSTITUTE UNDISCLOSED INCOME AS PER THE PROVISIO NS OF SECTION 271AAB OF THE ACT WAS DETECTED OR FOUND DURING THE SEARCH ACTION. IN VIEW OF THE VARIOUS CASE LAWS AS DISCUSSED ABOVE, THE AFORESAID AMOUNT FOR RS.14 CORES WOULD NOT FALL IN THE DEFINITION OF UNDISCLOSED INCOME AS DEFINED UNDE R SECTION 271AAB OF THE ACT AND, HENCE, THE PENALTY IS NOT LEVIABLE ON THE SAI D AMOUNT UNDER THE PROVISIONS OF SECTION 271AAB OF THE ACT. 13. SO FAR AS THE RELIANCE OF THE LD. DR ON THE DEC ISION IN THE CASE OF HON'BLE ALLAHABAD HIGH COURT IN THE CASE OF PRINCIPAL CIT VS. SHRI SANDEEP CHANDAK AND ORS. (SUPRA) IS CONCERNED, AS DISCUSSED IN THE AFOR ESAID DECISION OF THE COORDINATE BENCH OF THE TRIBUNAL IN DCIT VS. RASHMI CEMENT LT D, (SUPRA) THE FACTS IN THE CASE OF PRINCIPAL CIT VS. SHRI SANDEEP CHANDAK AND ORS (SUPRA) ARE DISTINGUISHABLE AND DO NOT APPLY TO THE FACTS AND CIRCUMSTANCES OF THE CASE IN HAND IN THE LIGHT OF THE DISCUSSION MADE IN THE ABOVE REFERRED TO DEC ISION OF THE KOLKATA BENCH OF THE TRIBUNAL. 14. HOWEVER, SO FAR AS THE SURRENDERED AMOUNT OF RS . 39.99 LACS IS CONCERNED, SAME WAS OFFERED ON ACCOUNT OF PROFITS ON STOCK FOU ND SHORT DURING THE SEARCH ACTION. ADMITTEDLY, THE STOCK WAS FOUND SHORT DURI NG THE SEARCH ACTION. IN FACT, THE ASSESSING OFFICER APART FROM THE ABOVE SURRENDE R OF RS. 39.99 LACS HAS MADE FURTHER ADDITION OF RS. 2.58 CORES ON THIS ISSUE. I T IS APPARENT THAT THE AFORESAID PROFIT ON SHORT STOCK WERE NOT ACCOUNTED FOR BY THE ASSESS EE BUT WAS ONLY DETECTED DURING THE SEARCH ACTION. HOWEVER, THE ASSESSEE HAS SUBSTANTIATED THE MANNER OF EARNING OF THE SAID INCOME WHICH INCLUDE THE SURREN DER INCOME OF RS. 39.99 LACS, 14 HENCE, PENALTY @ 10% IS LEVIABLE ON THE AFORESAID AMOUNT AS PER THE PROVISIONS OF SECTION 271AAB (1)(A) OF THE I.T. ACT. 14. IN VIEW OF THIS, THE PENALTY IN THIS CASE IS RE STRICTED TO 10% OF THE SURRENDERED INCOME OF RS. 39,99,158/- ON ACCOUNT OF STOCK FOUND SHORT AS PER THE PROVISIONS OF SECTION 271AAB (1)(A) OF THE ACT. HOWEVER, THE REMA INING PART OF THE PENALTY IS ORDERED TO BE DELETED. 9. FROM THE PERUSAL OF THE ABOVE DECISION, IT CAN B E NOTICED THAT THE TRIBUNAL HAS CATEGORICALLY HELD THAT IF NO INCRIMINATING MATERIA L IS FOUND DURING THE SEARCH ACTION AND THE SURRENDERED INCOME DOES NOT FALL IN THE DEFINIT ION OF UNDISCLOSED INCOME AS DEFINED U/S 271AAB OF THE ACT, THE PENALTY IS NOT WARRANTED. TH E COORDINATE BENCH OF THE TRIBUNAL HAS ALSO DISCUSSED THE PROPOSITION OF LAW LAID DOWN BY THE HON'BLE ALLAHABAD HIGH COURT IN THE PRINCIPAL CIT VS SANDEEP CHANDAK AND ORS. (SUPRA) AND HAS HELD THAT THE FACTS OF THE SAID CASE ARE DISTINGUISHABLE AND DO NOT APPLY TO T HE FACTS OF THE CASE IN WHICH NO INCRIMINATING MATERIAL IS FOUND DURING THE SEARCH ACTION. 10. HOWEVER,, LD. COUNSEL FOR THE ASSESSEE HAS BEE N FAIR ENOUGH TO ADMIT THAT IT IS NOT IN ALL THE CASES THAT NO INCRIMINATING MATERIAL WAS FOUND. THAT CERTAIN ITEMS OF JEWELLERY OF SILVER WERE FOUND / NOTICED DURING THE SEARCH ACTIO N, THE SOURCE OF INCOME FROM WHICH AS HELD BY THE ASSESSING OFFICER ALSO STOOD EXPLAINED AND ALSO THE MANNER OF EARNING OF THE INCOME WAS ALSO SUBSTANTIATED. HE, THEREFORE, HAS BEEN FAIR ENOUGH TO ADMIT THAT PENALTY UNDER THE PROVISIONS OF SECTION 271AAB (1)(A) OF TH E ACT WAS LIABLE TO BE CONFIRMED TO THE EXTENT OF THE PROPERTY /MATERIAL FOUND DURING SEARC H ACTION. HE, IN THIS RESPECT HAS GIVEN A CHART, WHICH FOR THE SAKE OF READY REFERENCE, IS RE PRODUCED AS UNDER:- S.NO. PARTICULARS SUKHDARSHAN KUMAR RAMA RANI VEN NA RANI R.D. PLACE PRIVATE LIMITED 1 JEWELLERY 0 133 54.23 0 2 SILVER 0 0 8.40 0 3 INCOME DECLARED 230 67 27.37 300 TOTAL 230 200 190 300 11. IN THE CASE OF MRS. RAMA RANI, (ITA NO. 1240/CH D/2018) FOR ASSESSMENT YEAR 2016- 17, AS NOTED FROM THE ABOVE CHART, JEWELLERY WORTH RS. 1.33 CRORES WAS FOUND, WHEREAS, INCOME SURRENDERED BY HER DURING THE SEARCH ACTION WAS OF RS. 2CRORES. IN VIEW OF THE DISCUSSION MADE ABOVE, THE PENALTY US 271AAB(1)(A) OF THE ACT IS RESTRICTED TO THE VALUE OF THE JEWELLERY FOUND DURING SEARCH ACTION I.E. R S. 1.33 CRORES, THE 10% OF WHICH COMES TO RS. 13.30LACS, HENCE, THE PENALTY IN THE CASE OF M RS. RAMA RANI IS RESTRICTED TO RS. 13.30LACS AS AGAINST RS. 20LACS IMPOSED BY THE ASSESSING OFFI CER. 12. SIMILARLY, IN THE CASE OF MRS. VEENA RANI (ITA NO. 1238/CHD/2018) FOR ASSESSMENT YEAR 2016-17, THE TOTAL INCOME SURRENDERED WAS OFR S. 1.90 CRORES, WHEREAS, THE JEWELLERY FOUND DURING SEARCH ACTION WAS OF THE VALUE OF RS. 54.23 LACS AND SILVER FOUND OF RS. 8.40LAC.HENCE, THE PENALTY LEVIABLE ON THE AFORESAI D GROSS AMOUNT OF 6.263 LACS(RS. 54.23 LCS + RS. 8.40 LACS), WHICH IS CALCULATED @ 10% AT RS. 6.263 LACS. HENCE, THE PENALTY IS CALCULATED AND RESTRICTED TO RS. 6.263 LACS IN THIS CASE. 13. IN THE CASE OF SUDKHARAN KUMAR IN ITA NO. 1239/ CHD/2018 FOR THE ASSESSMENT YEAR 2016-17, NEITHER ANY INCRIMINATING MATERIAL NOR VAL UED PROPERTY WAS FOUND, HENCE, NO 15 PENALTY IN THIS CASE UNDER THE PROVISIONS OF SECTI ON 271AAB (1)(A) OF THE ACT IS EXIGIBLE. THE PENALTY IN THIS CASE IS ORDERED TO BE DELETED. 14. NOW COMING TO THE CASES OF M/S R.D. PALACE PV T. LTD, LUDHIANA IN ITA NOS. 1241& 1242/CHD/2018 FOR THE ASSESSMENT YEARS 2015-16 AND 2016-17, SINCE, NO INCRIMINATING MATERIAL OR VALUED PROPERTY WAS FOUND IN THESE CASE S AND FURTHER NO UNACCOUNTED PROPERTY WAS FOUND DURING THE SEARCH ACTION, HENCE, THE PENALTY IS NOT LEVIABLE IN THESE CASES AND THE SAME IS ACCORDINGLY ORDERED TO BE DEL ETED. 7. SINCE THE FACTS OF THE PRESENT CASES ARE IDENTICAL TO THE FACTS INVOLVED IN THE AFORESAID REFERRED TO CASES, SO RESPECTFULLY FOLLOW ING THE EARLIER ORDER DT. 12/07/2019, THE IMPUGNED PENALTIES LEVIED BY THE A.O. AND SUSTAINED BY THE LD. CIT(A) UNDER SECTION 271AAB OF THE ACT ARE DELETED. 8. IN THE RESULT, BOTH THE ABOVE APPEALS OF THE ASSESSEE S ARE ALLOWED. (ORDER PRONOUNCED IN THE OPEN COURT ON 19/09/2019) SD/- SD/- #$ % .., (SANJAY GARG ) ( N.K. SAI NI) & '(/ JUDICIAL MEMBER ! / VICE PRESIDENT AG DATE: 19/09/2019 (+ ! ,- .- / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. $ / / CIT 4. $ / ()/ THE CIT(A) 5. -23 4, & 4, 67839/ DR, ITAT, CHANDIGARH 6. 38 :%/ GUARD FILE