Shri Suresh J. Patel, Surat V. The ACIT, Central Circle-3, Surat

ITA 97/AHD/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 6298 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 2 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-04-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 16-03-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 13-01-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: R B SHAH
• Keywords: Unexplained investment; Depreciation; Income from undisclosed sources
• Section: 132; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD A BENCH (BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER & SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER) ITA. NO: 97/AHD/2016 (ASSESSMENT YEAR: 2011-12) SURESH J PATEL, SHIV SADAN, LCHHANATH TEMPLE, ATHWALINES, SURAT V/S ACIT, CENTRAL CIRCLE-3, SURAT (APPELLANT) (RESPONDENT) PAN: ADIPP6181A APPELLANT BY : SHRI R. B. SHAH, AR RESPONDENT BY : SHRI K. MADHUSUDAN, SR. D.R. ( )/ ORDER DATE OF HEARING : 20-03-2017 DATE OF PRONOUNCEMENT : 03-04-2017 PER N.K. BILLAIYA, ACCOUNTANT MEMBER: 1. AGGRIEVED AND NOT SATISFIED WITH THE ORDER OF THE L D. CIT(A)-4, SURAT DATED 11.12.2015 PERTAINING TO A.Y. 2011-12, THE ASSESSEE IS IN APPEAL BEFORE US. ITA NO. 97/A HD/2016 . A.Y. 2011-1 2 2 2. THE ONLY GRIEVANCE OF THE ASSESSEE RELATES TO THE L EVY OF PENALTY OF RS. 42, 33,139/- U/S. 271AAA OF THE ACT WHICH IS UPHELD BY THE LD. CIT(A). 3. REPRESENTATIVES OF BOTH THE SIDES WERE HEARD AT LEN GTH. AFTER HEARING THE RIVAL CONTENTIONS, WE HAVE CAREFULLY PERUSED THE OR DERS OF THE AUTHORITIES BELOW. 4. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT A SEA RCH ACTION U/S. 132 OF THE ACT WAS CARRIED OUT ON 08.06.2010 IN THE CASE OF BU ILDER GROUP OF SURAT. ONE OF THE PERSONS OF THE GROUP IS THE ASSESSEE. 5. DURING THE COURSE OF THE SEARCH OPERATIONS, THE STA TEMENT OF THE ASSESSEE WAS RECORDED U/S. 132(4) OF THE ACT IN WHICH HE MAD E A DISCLOSURE OF RS. 5 CRORES. OUT OF THIS DISCLOSURE, RS. 4,23,31,392/- W AS OFFERED BY THE ASSESSEE FOR THE YEAR CONSIDERATION. 6. SUBSEQUENTLY, THE DISCLOSURE OF RS. 5 CRORES WAS BI FURCATED BETWEEN THE ASSESSEE AND HIS FATHER SHRI JAYANTIBHAI PATEL AND THE BREAK UP READS AS UNDER:- A.Y. SURESHBHAI PATEL (AMOUNT IN RS.) JAYANTIBHAI PATEL (AMOUNT IN RS.) 2006 - 07 ---------------- 5,50,000/ - 2007 - 08 34,00,000/ - -------------- 2010 - 11 32,22,958/ - 4,95,650/ - 2 - 11 - 12 4,23,31,392/ - (72,29,667+ 3,51,01,725) -------------------- TOTAL RS. 4,89,54,350/ - RS. 10,45,650/ - RS. 5,00,00,000/ - ITA NO. 97/A HD/2016 . A.Y. 2011-1 2 3 7. THE SEARCH PARTY FOUND UNEXPLAINED INVESTMENT IN CA RS, JEWELLERY, WATCHES AND ALSO 52,00,000/- ON ACCOUNT OF CASH WAS FOUND A T THE TIME OF SEARCH. THE ASSESSEE DECLARED RS. 3,51,01,725/- VOLUNTARILY IN THE RETURN OF INCOME FOR A.Y. 2011-12 TO MAKE UP TOTAL DISCLOSURE OF RS. 5 CRORES. THUS, THE TOTAL DISCLOSURE FOR A.Y. 2011-12 WAS AT RS. 4,23,31,392/ - AND AFTER CLAIMING DEPRECIATION ON MOTOR VEHICLES, THE DISCLOSE TAXABL E INCOME WAS AT RS. 4,10,61,220/-. 8. THE A.O. ISSUED SHOW CAUSE NOTICE TO THE ASSESSEE A ND ASKED THE ASSESSEE TO SHOW CAUSE WHY PENALTY U/S. 271AAA SHOULD NOT BE LEVIED ON THE UNDISCLOSED INCOME OF RS. 4,23,31,392/-. 9. ASSESSEE FILED A DETAILED REPLY CHALLENGING THE PRO POSED LEVY OF PENALTY U/S. 271AAA OF THE ACT. THE ASSESSEE STRONGLY CONTENDED THAT THE DECLARATION WAS VOLUNTARY AND THERE IS NO ELEMENT OF UNDISCLOSE D INCOME SO AS TO ATTRACT PENALTY U/S. 271AAA OF THE ACT. IT WAS BROU GHT TO THE NOTICE OF THE A.O. THAT THE ASSESSEE HAS COMPLIED WITH ALL THE CO NDITIONS EXEMPTING HIM FROM THE LEVY OF PENALTY U/S. 271AAA OF THE ACT. 10. THE DETAILED SUBMISSION AND CLAIM OF THE ASSESSEE D ID NOT FIND ANY FAVOUR WITH THE A.O. THE A.O. OUT RIGHTLY REJECTED THE CLA IM OF AGRICULTURE INCOME OF THE ASSESSEE STATING THAT THERE WAS NO DOCUMENTA RY EVIDENCE. THE A.O. FURTHER OBSERVED THAT THE ASSESSEE HAS NOT FULFILLE D ALL THE MANDATORY CONDITIONS MENTIONED IN SECTION 271AAA OF THE ACT. THE A.O. WAS OF THE ITA NO. 97/A HD/2016 . A.Y. 2011-1 2 4 OPINION THAT THE ASSESSEE HAS FAILED TO SPECIFY AND SUBSTANTIATE THE MANNER IN WHICH THE UNDISCLOSED INCOME WAS DERIVED IN SPIT E OF THE OPPORTUNITY GIVEN AT THE TIME OF ASSESSMENT PROCEEDINGS ALSO. 11. THE A.O. CONCLUDED BY STATING THAT THOUGH THE ASSES SEE HAS OFFERED UNDISCLOSED INCOME OF RS. 4,23,31,392/- DURING THE SEARCH OPERATION BUT HAS NOT FULFILLED THE CONDITIONS FOR IMMUNITY FROM THE PENALTY. THE A.O. ACCORDINGLY LEVIED PENALTY @ 10% OF OFFERED UNDISCL OSED INCOME OF RS. 4,23,31,392/- AND COMPUTED THE PENALTY AT RS. 42,33 ,139/-. 12. ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) BUT WITHOUT ANY SUCCESS. 13. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE VEHEMEN TLY STATED THAT THE ASSESSEE HAS GIVEN COMPLETE DETAILS OF THE HOLDING OF THE AGRICULTURAL LAND ALONG WITH THE DETAILS OF THE AGRICULTURAL INCOME D ERIVED THERE FROM. IT IS THE SAY OF THE LD. COUNSEL THAT THERE IS NO UNDISCL OSED INCOME IN THE SENSE THAT THE ASSESSEE HAS DECLARED THE INCOME VOLUNTARI LY AND HAS ALSO COMPLIED WITH THE CONDITIONS SPECIFIED UNDER CLAUSE 2 OF SECTION 271AAA AND, THEREFORE NO PENALTY SHOULD BE LEVIED. 14. THE LD. COUNSEL FURTHER CONTENDED THAT SINCE NO SPE CIFIC QUESTION WAS ASKED DURING THE COURSE OF THE RECORDING OF THE STATEMENT U/S. 132(4) OF THE ACT REGARDING THE MANNER AND THE SOURCE FROM WHICH THE UNDISCLOSED INCOME WAS DERIVED, THERE WAS NO OCCASION TO ANSWER. FOR T HIS PROPOSITION, STRONG RELIANCE WAS PLACED ON THE DECISION OF THE HONBLE HIGH COURT OF GUJARAT IN ITA NO. 97/A HD/2016 . A.Y. 2011-1 2 5 THE CASE OF MAHEDRA C. SHAH 299 ITR 305. PER CONTRA , THE LD. D.R. STRONGLY SUPPORTED THE FINDINGS OF THE REVENUE AUTHORITIES. 15. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE ORD ERS OF THE AUTHORITIES BELOW. WE HAVE ALSO CAREFULLY PERUSED THE ASSESSMEN T ORDER. THERE IS NO DISPUTE THAT THE ASSESSEE HAD VOLUNTARILY OFFERED U NDISCLOSED INCOME OF RS. 4,23,31,392/- IN HIS RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION. BEFORE PROCEEDING FURTHER, LES US UNDERSTAND THE PR OVISIONS OF SECTION 271AAA OF THE ACT WHICH READ AS UNDER:- 271AAA. (1) TE ASSESSING OFFICER MAY, NOTWITHSTANDI NG 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 JUNE, 2007 [BUT BEFORE THE 1 ST DAY OF JULY, 2012], THE ASSESSEE SHALL PAY BY WAY OF PENAL TY, IN ADDITION TO TAX, IF ANY, PAYABLE BY HIM, A SUM COMPUTED AT THE RATE OF TEN P ER 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 SPEC IFIES THE 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. (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 TH E UNDISCLOSED 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,- ITA NO. 97/A HD/2016 . A.Y. 2011-1 2 6 (A) UNDISCLOSED INCOME MEANS- (I)ANY INCOME OF THE SPECIFIED PREVIOUS YEAR REPRES ENTED, EITHER WHOLLY OR PARTLY, BY ANY MONEY, BULLION, JEWELLERY OR OTHER V ALUABLE ARTICLE OR THING OR ANY ENTRY IN THE BOOKS OF ACCOUNT OR OTHER DOCUM ENTS OR TRANSACTIONS 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 RELATING TO SUCH PREVIOUS YEAR; OR (B) OTHERWISE NOT BEEN DISCLOSED TO THE [PRINCIPAL CHIEF COMMISSIONER OR] CHIEF COMMISSIONER OR [PRINCIPAL COMMISSIONER OR] C OMMISSIONER 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; (B) SPECIFIED PREVIOUS YEAR MEANS THE PREVI OUS YEAR- (I) WHICH HAS ENDED BEFORE THE DATE OF SEARCH, BU T THE DATE OF FILING THE RETURN OF INCOME UNDER SUB-SECTION (1) OF SECTION 1 39 FOR SUCH YEAR HAS NOT EXPIRED BEFORE THE DATE OF SEARCH AND THE ASSES SEE HAS NOT FURNISHED THE RETURN OF INCOME FOR THE PREVIOUS YEAR BEFORE T HE SAID DATE; OR (II)IN WHICH SEARCH WAS CONDUCTED.] 16. NOW, LET US EXAMINE THE FACTS OF THE CASE IN HAND I N THE LIGHT OF THE PROVISIONS OF CLAUSE 2 MENTIONED HEREINABOVE:- (I) THERE IS NO DISPUTE THAT IN HIS STATEMENT RECOR DED U/S. 132(4) OF ACT, THE ASSESSEE HAS ADMITTED THE UNDISCLOSED INCOME OF RS. 4,23,31,392/- FOR THE YEAR UNDER CONSIDERATION. (II) IT IS TRUE THAT THE ASSESSEE DID NOT SUBSTANTI ATE THE MANNER IN WHICH THE UNDISCLOSED INCOME WAS DERIVED. ITA NO. 97/A HD/2016 . A.Y. 2011-1 2 7 (III) IT IS EQUALLY TRUE THAT THE ASSESSEE HAS PAID THE TAXES ALONG WITH INTEREST THEREON IN RESPECT OF THE UNDISCLOSED INCOME. 17. NOW THE QUESTION ARISES IS WHETHER THE MANNER IN WH ICH SUCH INCOME HAS BEEN DERIVED AND WHETHER IT HAS BEEN SUBSTANTIATED WAS EXPLAINED BY THE ASSESSEE. THE RELEVANT QUESTION PUT TO THE ASSESSEE DURING THE COURSE OF THE RECORDING OF THE STATEMENT U/S. 132(4) OF THE A CT READ AS UNDER:- STATEMENT ON OATH/SOLEMN AFFIRMATION RECORDED FROM SHRI SURESHBHAI J. PATEL SON OF JAYANTIBHAI BALUBHAI PATEL ON 09.06.2010 DURING THE COURSE OF SEARCH PROCEEDINGS AT 'SHIV SADAN', B/D. ICHCHHANATH TEMPL E, SURAT SD/- SD/- SUESH J. PATEL RAJESHKUMAR LAL 09.06.2010 INCOME TAX OFFICER (I NV.), SURAT 09 .06.2010 Q:22 YOU HAVE NOT PREPARED ANY ACCOUNTING RECORDS O F YOURSELF AS WELL AS YOUR FAMILY MEMBERS. DURING THE COURSE OF SEARCH PROCEED INGS AT YOUR RESIDENCE, CASH AMOUNTING TO RS. 52,75,900 HAS BEEN FOUND. OTHER TH AN THIS, I AM SHOWING YOU ANNEXURE A-1 TO ANNEXURE A-4. AFTER CONSIDERING ALL THESE THINGS DO YOU WANT TO SAY ANYTHING? A:22 ACCORDING TO MY KNOWLEDGE MAJORITY OF CASH OUT OF THE AMOUNT OF RS. 52,75,900 IS FROM AGRICULTURAL ACTIVITIES. HOWEVER, I CANNOT SPECIFICALLY CLARIFY THAT HOW THIS CASH AMOUNT HAS BEEN RECEIVED. THAT IS WHY I AM VOLUNTARILY DECLARING RS. 50,00,000 AS MY UNACCOUNTED INCOME. I HAVE AGAI N GONE THROUGH FILES OF ANNEXURE A-1 TO ANNEXURE A-4 SHOWN BY YOU. LOOKING AT THESE FILES, SOME PAPERS MIGHT BE RELATED TO MY UNACCOUNTED INCOME AND UNACC OUNTED EXPENSES. TO COVER UP THE SAME AND ANY OTHER DISCREPANCIES AND ALSO TO BUY PEACE OF MIND I VOLUNTARILY DECLARE RS. 4,50,00,000/- AS MY UNACCOU NTED INCOME. ACCORDINGLY, I AM MAKING VOLUNTARY DECLARATION OF TOTAL AMOUNT OF RS. 5,00,00,000/- AS UNACCOUNTED INCOME AND I ASSURE TO PAY ON TIME TAX ON IT. Q:23 YOU HAVE ANSWERED IN Q. NO. 2 THAT YOU ARE ENG AGED IN THE AGRICULTURAL ACTIVITIES SO TELL US THAT WHAT YOU HAVE GROWN DURI NG THE YEAR ? ITA NO. 97/A HD/2016 . A.Y. 2011-1 2 8 A:23 ME AND MY FAMILY MEMBERS ARE MAINLY ENGAGED IN GROWING MANGOES, CHIKOO, SUGARCANE, DANGAR AND VEGETABLES. 18. IF THE AFOREMENTIONED STATEMENT IS CONSIDERED IN TH E LIGHT OF THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT OF GUJARAT IN THE CASE OF MAHENDRA C. SHAH (SUPRA) THERE REMAINS NO DOUBT THAT NO SPECIFI C QUESTION WAS ASKED BY THE SEARCH PARTY RELATING TO THE MANNER IN WHICH TH E INCOME HAS BEEN DERIVED. THE HONBLE ALLAHABAD HIGH COURT IN THE CA SE OF RADHA KISHAN GOEL 278 ITR 454 HAS ACCEPTED THAT UNLESS THE AUTHORIZED OFFICER PUTS A SPECIFIC QUESTION WITH REGARD TO MANNER IN WHICH INCOME HAS BEEN DERIVED. IT IS NOT EXPECTED FROM THE PERSON TO MAKE A STATEMENT IN THI S REGARD. 19. THOUGH THE ASSESSEE HAS TRIED TO EXPLAIN THE SOURCE AS AGRICULTURAL INCOME BUT THIS SEEMS TO BE ILLOGICAL AND NOT ACCEPTABLE. FOR THE SIMPLE REASON THAT NO PRUDENT PERSON WILL ACCEPT UNDISCLOSED INCOME DE RIVED FROM AGRICULTURAL SOURCES AND OFFER THE SAME FOR TAXATION KNOWING FUL LY WELL THAT AGRICULTURAL INCOME IS TOTALLY EXEMPT FROM TAX. THEREFORE, THIS THEORY OF THE ASSESSEE IS NOT ACCEPTABLE. 20. HOWEVER, IF WE CONSIDER THE DEFINITION OF UNDISCLOS ED INCOME GIVEN IN THE EXPLANATION TO SECTION 271AAA MENTIONED HEREINABOVE , UNDISCLOSED MEANS:- EXPLANATION.- FOR THE PURPOSES OF THIS SECTION,- (A) UNDISCLOSED INCOME MEANS- (I)ANY INCOME OF THE SPECIFIED PREVIOUS YEAR REPRES ENTED, EITHER WHOLLY OR PARTLY, BY ANY MONEY, BULLION, JEWELLERY OR OTHER V ALUABLE ARTICLE OR THING OR ANY ENTRY IN THE BOOKS OF ACCOUNT OR OTHER DOCUM ENTS OR TRANSACTIONS FOUND IN THE COURSE OF A SEARCH UNDER SECTION 132, WHICH HAS- ITA NO. 97/A HD/2016 . A.Y. 2011-1 2 9 (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 RELATING TO SUCH PREVIOUS YEAR; OR (B) OTHERWISE NOT BEEN DISCLOSED TO THE [PRINCIPAL CHIEF COMMISSIONER OR] CHIEF COMMISSIONER OR [PRINCIPAL COMMISSIONER OR] C OMMISSIONER 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; (B) SPECIFIED PREVIOUS YEAR MEANS THE PREVI OUS YEAR- (I) WHICH HAS ENDED BEFORE THE DATE OF SEARCH, BU T THE DATE OF FILING THE RETURN OF INCOME UNDER SUB-SECTION (1) OF SECTION 1 39 FOR SUCH YEAR HAS NOT EXPIRED BEFORE THE DATE OF SEARCH AND THE ASSES SEE HAS NOT FURNISHED THE RETURN OF INCOME FOR THE PREVIOUS YEAR BEFORE T HE SAID DATE; OR (II) IN WHICH SEARCH WAS CONDUCTED.] 21. IF THIS DEFINITION OF UNDISCLOSED INCOME IS CONSIDE RED IN THE LIGHT OF THE FACTS OF THE CASE IN HAND, THE UNACCOUNTED WEALTH UNEARTH ED DURING THE SEARCH OPERATION, RELATE TO THE INVESTMENT IN THE CARS TO THE TUNE OF RS. 63,66,842/- OUT OF WHICH INVESTMENT UP TO RS. 31,24 ,175/- WAS DULY EXPLAINED BALANCE REMAINED UNEXPLAINED. OUT OF WHIC H RS. 25,50,000/- WAS DECLARED IN A.Y. 2010-11 AND THE BALANCE OF RS. 6,9 2,667/- PERTAINED TO THE YEAR UNDER CONSIDERATION. FURTHER A SUM OF RS. 3.87 LACS WAS ON ACCOUNT OF UNEXPLAINED INVESTMENT IN PURCHASE OF BANGLES, RS. 9.50 LACS WAS ON ACCOUNT OF UNEXPLAINED INVESTMENT IN WATCHES AND RS . 52 LACS WAS ON ACCOUNT OF CASH FOUND AT THE TIME OF SEARCH WHICH T OTALS TO RS. 72,29,667/-. ITA NO. 97/A HD/2016 . A.Y. 2011-1 2 10 22. ALTHOUGH, THE ASSESSEE HAS OFFERED UNDISCLOSED INCO ME OF RS. 42,33,13,92/-, IN OUR CONSIDERED OPINION AND ON THE BASIS OF THE FACTS ON RECORD ONLY TO THE EXTENT OF RS. 72,29,667/- UNDISCLOSED WEALTH WA S FOUND. 23. IN OUR UNDERSTANDING OF THE LAW, WHEREVER AND WHENE VER THERE IS A VOLUNTARY OFFER OF UNDISCLOSED INCOME DURING THE CO URSE OF THE SEARCH OPERATION, THE SAME SHOULD HAVE A NEXUS WITH THE UN ACCOUNTED WEALTH UNEARTHED. IN THE CASE IN HAND, THE DECLARATION OF THE UNDISCLOSED INCOME IS FAR MORE IN EXCESS OF THE UNDISCLOSED AND UNEXPLAIN ED WEALTH FOUND DURING THE COURSE OF THE SEARCH OPERATION. THE VOLUNTARY O FFER OF THE ASSESSEE IS NOT IN CONSONANCE WITH THE MEANING OF UNDISCLOSED I NCOME GIVEN UNDER THE EXPLANATION TO SECTION 271AAA OF THE ACT AS MENTION ED ELSEWHERE. 24. THE SINE QUA NON FOR THE LEVY OF PENALTY, BE IT U/S . 271AAA OF THE ACT OR UNDER ERSTWHILE 271(1)(C) READ WITH EXPLANATION 5A OF THE ACT, IS THAT THE ASSESSEE SHOULD BE FOUND TO BE THE OWNER OF ANY MON EY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING AND THE UNDISCLO SED INCOME OF THE ASSESSEE IS FOUND TO BE INVESTED IN SUCH THINGS. TH IS MEANS THAT THERE SHOULD BE SOME NEXUS BETWEEN THE UNACCOUNTED WEALTH AND THE UNDISCLOSED INCOME. 25. ACCORDING TO US, THE PENALTY SHOULD BE LEVIED ONLY TO THE EXTENT OF THE UNEXPLAINED INVESTMENT FOUND AT THE TIME OF SEARCH AND IN THE CASE IN HAND, THE SAME IS AT RS. 72,29,667/-. THEREFORE, MO DIFYING THE FINDINGS OF THE LD. CIT(A), WE DIRECT THE A.O. TO RESTRICT THE PENALTY TO THE EXTENT OF RS. ITA NO. 97/A HD/2016 . A.Y. 2011-1 2 11 7,22,967/- BEING 10% OF RS. 72,29,667/-. ASSESSEE W ILL GET A RELIEF OF RS. 35, 10,172/-. 26. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 03 - 04- 20 17 SD/- SD/- (RAJPAL YADAV) (N. K. BILLAIYA) JUDICIAL MEMBER TRUE COPY ACCOUNTANT MEMBER AHMEDABAD: DATED 03/04/2017 RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD