Zafar Hayat, Keonjhar V. ACIT, Bhubaneswar

ITSSA 61/CTK/2013

• Counselvise Citation: [2022] 103 COUNSELVISE.COM (IT) 8964 (ITAT-CUTTACK)
• Duration Of Justice: 9 year(s) 5 month(s) 12 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 03-11-2022
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: DB
• Next Hearing Date: 03-11-2022
• Assessment Year: 2008-2009
• Appeal Filed On: 22-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Search and seizure; Document seized; Opportunity of being heard; Principle of natural justice; Initiation of penalty proceedings; Documents seized; Bonafide mistake
• Section: 145; 271(1)(c); 273B; 153A; 292BB; 274; 207; 192; 113

Judgement Text

आयकर अऩीऱीय अधधकरण, कटक न्यायऩीठ,कटक IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK श्री जाजज माथन, न्याययक सदस्य एवं श्री अरुण खोड़पऩया ऱेखा सदस्य के समऺ । BEFORE SHRI GEORGE MATHAN, JUDICIAL MEMBER AND SHRI ARUN KHODPIA, ACCOUNTANT MEMBER आयकर (तऱाशियाां और अशिग्रहण) अऩीऱ सं /IT(SS)A No.56-61 & 126/C TK/2013 (ननधाारण वषा / Asses s m ent Years :2003-2004 to 2009-2010) Zafar Hayat, Near TV Centre, New Colony, Joda, Dist : Keonjhar Vs ACIT-1(2), Bhubaneswar PAN No. : AAAPZ 6665 L AND आयकर (तऱाशियाां और अशिग्रहण) अऩीऱ सं /IT(SS)A No .75 / C T K/ 2 0 1 3 ( AY: 2 0 0 3-04) आयकर (तऱाशियाां और अशिग्रहण) अऩीऱ सं /IT(SS)A No .76/ C T K/ 2 0 1 3( AY: 2 0 0 4-05) आयकर (तऱाशियाां और अशिग्रहण) अऩीऱ सं /IT(SS)A No .77/ C T K/ 2 0 1 3( AY: 2 0 0 5-06) IT(SS)A N o.78/C TK /2013 ( AY: 2006-20 07) IT(SS)A N o.79/C TK /2013 ( AY: 2007-2008) IT(SS)A Nos.80 &1 39/CT K/2013 (AY:2008-09 & 2009-10) ACIT-1(2), Bhubaneswar Vs Zafar Hayat, Near TV Centre, New Colony, Joda, Dist : Keonjhar PAN No. : AAAPZ 6665 L AN D आयकर अऩीऱ सं/ITA No.14/C TK/2014 ( AY: 2009-2010 ) आयकर अऩीऱ सं/ITA No.203/C TK/2020 ( AY: 2003-2004 ) आयकर अऩीऱ सं/ITA No.204/C TK/2020 ( AY: 2004-2005 ) आयकर अऩीऱ सं/ITA No.205/C TK/2020 ( AY: 2005-2006 ) आयकर अऩीऱ सं/ITA No.206/C TK/2020 ( AY: 2006-2007 ) आयकर अऩीऱ सं/ITA No.207/C TK/2020 ( AY: 2007-2008 ) आयकर अऩीऱ सं/ITA No.208/C TK/2020 ( AY: 2008-2009 ) आयकर अऩीऱ सं/ITA No.209/C TK/2020 ( AY: 2009-2010 ) Zafar Hayat, Near TV Centre, New Colony, Joda, Dist : Keonjhar Vs ACIT-1(2), Bhubaneswar PAN No. : AAAPZ 6665 L (अऩीऱाथी /Appellant) .. (प्रत्यथी / Respondent) Zafar Hayat 2 ननधााररती की ओर से /Assessee by : Shri Sunil Mishra, Advocate राजस्व की ओर से /Revenue by : Shri M.K.Gautam, CIT-DR स ु नवाई की तारीख / Date of Hearing : 04/11/2022 घोषणा की तारीख/Date of Pronouncement : 04/11/2022 आदेश / O R D E R Per Bench : IT(SS)A Nos.56-61&126/CTK/2013 have been filed by the assessee and IT(SS)A Nos.75,76-77/CTK/2013 along with IT(SS)A Nos.78-80 & 139/CTK/2013 have been filed by the revenue against the separate orders of the ld. CIT(A)-1, Bhubaneswar dated 21.03.2013 & 15.03.2013 for the assessment years 2003-2004 to 2009-2010, respectively. The assessee has also filed ITA Nos.14/CTK/2014 & ITA Nos.203-209/CTK/2020, against the separate orders of the ld. CIT(A)-1, Bhubaneswar, dated 08.11.2013, 18.08.2020 & 02.09.2020, respectively, for the assessment years 2003-2004 to 2009-2010. 2. In all the appeals, the facts and circumstances of all the appeals are similar and identical to each other, except different in figures. Therefore, all the appeals are heard altogether and disposed off en masse. 3. First, we shall decide the appeals of the assessee in IT(SS)A Nos.56-61&126/CTK/2013 along with appeals of the revenue in IT(SS)A Nos.75,76-77/CTK/2013 and IT(SS)A Nos.78-80 & 139/CTK/2013. 4. At the time of hearing, it was fairly agreed by both the sides that the issues in all the appeals are squarely covered by the decisions of the coordinate bench of the Tribunal in the case of Dillip Kumar Naik, passed in IT(SS)A Nos.4 to 8/CTK/2015, dated 21.10.2022, in the case of Sarosh Zafar Hayat 3 Yazdani, in IT(SS)A Nos.53-55, 67&68/CTK/2013 along with other connected appeals, order dated 03.11.2022 and also in the case of S.M. Enterprises, passed in IT(SS)A Nos.128 to 132 & 133 to 137/CTK/2013, order dated 20.10.2022. It was also submitted by the ld. AR that the coordinate bench of the Tribunal in the case of Sarosh Yazdani, referred supra, in para 3 to 4 has reduced the net profit percentage to 8% as against 10% adopted by the ld. CIT(A). The relevant observations of the Tribunal are as under :- 3. At the time of hearing, it was fairly agreed by both the sides that the issues involved in these appeals are squarely covered by the decision of the Co-ordinate Bench of this Tribunal in the case of Dillip Kumar Naik in IT(ss) A N os.4 t o 8/C TK/2015 fo r Assess ment Yea r s : 2005-06 to 2009-10 and C.O . Nos.25 t o 29/CT K/2015, order dated 21.10.2022, w herein, it para 8, i t has been held as follow s: “8. Coming to the issue of percentage of the net profit as determined by the ld CIT(A) at 10%. A perusal of the order of the ld CIT(A) clearly shows that the highest percentage disclosed by the assessee is 6%. This being so, we are of the view that the interest of justice would be served if the estimation of the percentage of net profit is taken at 8% as against 10% directed by the ld CIT(A) and we do so. The findings of ld CIT(A) in regard to adoption of estimation of income of the assessee stands upheld and the estimation of income by the ld CIT(A) at 10% stands reduced to 8%.” 4. Here, it must be mentioned that the assessee has filed a chart, which shows the profit percentage is varied in between 5.8% to 7.26% for the assessment years 2004-05 to 2008-09. This being so, we are of the view that respectfully following the decision of the Co-ordinate Bench, on identical facts in the case of Dillip Kumar Naik (supra), the estimation of 10% as done by the ld CIT(A) stands reduced to 8%. 5. In reply, ld. CIT-DR has also filed written submissions as follows :- The assessee is engaged in the business of iron ore raising contracts for M/s. Serajuddin & Co. A search & seizure operation u/s.132 of the Income Tax Act was carried out on 28.05.2008 at the premises of the mine owner namely M/s. Serajuddin & Co. Many Zafar Hayat 4 incriminating documents were found which showed that the assessee used to raise the bills at an higher amount and thereafter cash in the vicinity of 50% to 60% was returned to M/s. Serajuddin & Co. To further corroborate these findings, a survey action u/s.133A of the Act was carried out at the premises of the assessee on 09.07.2008 followed by search u/s.132 of the Act on 27.09.2008 i.) Notice u/s.153A (a) dated 11.03.2010 was sent through RPAD and same was duly served on the assessee. However the assessee did not file any return of income in response to said notice. The A.O. vide letters dated 01.07.2010 & 13.10.2010 also informed the assessee to file the returns of income for various assessment years but of no avail. The A.O. also informed the assessee vide letter dated 0~.09.2010 that since extracts of seized documents had been provided to the AR of M/s. Serajuddin & Co. therefore he should immediately file return of income. But there was no compliance from the assessee. ii.) Notice u/s.142(1) along with the questionnaire was issued on 26.07.2010 fixing the compliance on 05.08.2010 but there was non- compliance. The assessee neither sought any adjournment nor filed the requisite details. The A.O. also issued summons dated 02.08.2010 & 12.10.2010 u/s.131 of the Act to the assessee to produce the books of account, bank statements and other details. But the assessee did not appear before the A.O. The A.O. thereafter issued a final show-cause notice dated 13.10.201 0 informing the assessee that in case of non-compliance, the assessment shall be completed on the basis of material available on record. In these facts & circumstances, the assessment was completed ex-parte u/s.144 of the Act. iii.) The search operations also revealed that Shri Zafar Hayat was inflating the labour expenses, Power & Fuel charges and other expenses. Even the alleged vouchers for various expenses were also not found. For example, the assessee had claimed labour expenses of Rs.4.51 crores in FY 2006-07 in his profit & loss account (as per original return filed u/s.139(1) of the Act). However from the seized wages registers (ZH-18 to ZH-21) and Form D register (ZH-3, ZH-4 and ZH-13), that maximum number of labourers employed by the assessee stood at 60 to 70. The payment of labour was made at the rates prescribed by the Labour Department, Even assuming that it was slightly higher than that applicable for skilled labour (Rs.90/- per person) and estimating the same for 300 days, the total expenses under the head "labour payment" could not have exceeded Rs.16 lakhs. On the other hand, the assessee had claimed labour payment of Rs.4.51 crores in AY 2007-08. Thus claim of labour/salary payment made by the assessee was highly inflated. Even the power & fuel expenses claimed at Rs.3.56 crores were highly inflated. Considering that the assessee had only one poclain Zafar Hayat 5 machine employed by him for raising work. Besides above, he had tippers employed in the mines. He did not do any transportation work. Considering the above, the average consumption of fuel would not have exceeded 36,000 litres per day (being the upper limit as admitted by Shri Shyam Sunder Bana) and even these were utilized for 200 days in that year, the fuel expenses could not have exceeded Rs.15 lakhs. On the other hand, the assessee had claimed power & fuel expenses to the extent of Rs.3.56 crores in FY 2006-07. Further the survey action conducted in the case of the assessee on 09.07.2008 revealed that he was not maintaining regular books of accounts and no vouchers for the alleged expenses were found at his premises. Initially he stated that books of account & vouchers were lying at the premises of his advocate Shri Madan Mohan Kar. On the other hand, Shri Madan Mohan Kar in his statement before the Income Tax Authorities flatly refused to have kept any books of account/vouchers on behalf of the assessee. He also confessed that no books of account were being maintained by the assessee. When confronted with the statement of Shri Madan Mohan Kar, the assessee finally admitted that no books of account or vouchers were being maintained by him. Thus it was clear that from AY 2003-04 to AY 2009-10, neither the books of account nor any vouchers were found from the premises of the assessee confirming the inflation in the alleged expenses. The A.O. has discussed the statement of the assessee on pages-7 & 8 of the assessment order wherein he could not explain the higher raising expenses and fuel expenses. iv.) The A.O. has elaborately discussed the entries recorded in the documents impounded from the premises of the assessee in paras- 6.2 to 6.3 on pages 8 & 9 of the assessment order. Page-43 of impounded records (ZH-16) belonging to Mr. Zafar Hayat is very incriminating in nature. This document pertains to the period 2005- 06. It is partly typed and partly handwritten. It contains two tables titled "A/C Zafar Hayat" and "Advance given to Zafar Hayat". The first table mentions the details of raising work done by him, the month in which it was done, type of ore, quantity and amount as per bill. As noted from this table, the raising work was done in respect of iron ore lumps and Blue Dust. The rates for raising work in respect of iron ore lumps were @Rs.610/- per MT and Rs.110/- for Blue Dust respectively. The quantities raised during April to July, 2005 stood at 2733.56 MT of lumps and 34.15 MT of Blue Dust respectively. The total billed amount has been worked out at Rs.16,71,227/- for the four months. The assessee has also received the amount through cheques bearing nos.8I0663 and 810675 for Rs.17,15,000j- and Rs.7,00,000/-respectively. Thus he has been paid Rs.24,15,000/- as against billed amount of Rs.16,71,227/- resulting in excess of Rs.7,43,773/-. The A.G. has compared these typed entries with the handwritten entries at the bottom of this page. The quantities of iron ore lumps are mentioned at 2733.56 MT and 34.15 MT of iron ore fines (Blue Dust) which tally with the typed entries. The figure of Rs.9,84,082/- has been worked out by Zafar Hayat 6 multiplying the quantity of 2733.56 MT with Rs.360/- per MT and the figure of Rs.2220/- has been worked out by multiplying the quantity of 34.150 MT with Rs.65/- per MT. This is the cash amount aggregating to Rs.9,86,302/- which is to be returned to M/s. Serajuddin & Co. There is handwritten entry at the top of the page "September lumps-8338-Rs.30,01,680/- which was to be returned to M/s. Serajuddin & Co. (8338 MT multiplied by Rs.360/- per MT). After adding both these figures, the total cash to be returned to M/s. Serajuddin & Co. has been worked out at Rs.39,87,982/-. This page shows that there was continuous cash receipts from the assessee to M/s. Serajuddin & Co. on account of excess billing. v.) A bunch of loose sheets (SCPL/1 containing 10 pages) was found from the computer of M/s. Serajuddin & Co. at Balda Mines. Kindly refer to page-6 of the assessment order. These documents were prepared by Shri N. R. Nayak, GM of Balda mines and it was also duly signed by him on 10.02.2008. These documents were prepared to compare the raising cost before and after installation of screening unit for six mining contractors including the assessee. The average cost of production had been worked out at Rs.146/- per MT and that of the assessee stood at Rs.168/- per MT. As against these rates, the raising cost paid by M/s. Serajuddin & Co. to the assessee @ Rs.610/- & Rs.650/- per MT for iron ore lumps showed inflation of the expenses to the extent of 200%. vi.) The A.O. has discussed on pages-11 & 12 of the assessment order that many incriminating documents were found from the premises of M/s. Serajuddin & Co. during search operations on 28.05.08 which showed that the various mining contractors including the assessee used to pay back the amount in cash to the mine owner as high as 50% to 100% of total receipts for the contract work. For example, seized/impounded documents identified as RKS/Contractors payment details/sheet 1(9), sheet 1(4), sheet 3 etc. vii.) The A.O. has exhaustively analyzed the impounded/seized material and there is no doubt that the assessee indulged in inflating expenses. The assessee including other contractors had paid back cash ranging from 50% to 100% to M/s. Serajuddin & Co. through a carefully laid down modus-operandi of inflating expenses. The contractors had no other option but to co-operate and conspire with the mine owner. The excel sheets clearly and unambiguously point towards inflation of expenses and receipt of excess monies in cash from the contractors. Such cash received from the contractors was also allocated among partners and they had also shared the gains. Thus the order of the A.O. estimating NP @20% should be restored and that of the CIT(A) be reversed. Zafar Hayat 7 6. For the assessment year 2009-2010, it was submitted by the ld.CIT- DR that the revenue has raised the issue with regard to violation of Rule 46A of I.T.Rules, 1962. In this regard, ld. CIT-DR has filed his written submissions as under :- i.) In this case, the books of account were not found maintained during the course of Survey & Search operations. The Vouchers for various expenses were also not found during the Survey & Search operations. In response o the notice u/s.153A, the assessee did not file any return of income. During the course of assessment proceedings, the books of account and vouchers were not produced before the A.O. in spite of repeated opportunities. However strangely the Id. CIT(A) had taken on record audit report for AY 2009-10 without recording any reasons for the same. It is a settled law that a litigant has to demonstrate that it was prevented by sufficient cause to lead such evidence before the A.O. i.e. Whether the AO refused to take such evidence or the assessee failed to submit these for sufficient reasons or the AO did not provide him sufficient opportunity. As per sub-rule 1, 2 and 3 of Rule-46A, firstly the CIT(A) has to record his reasons for taking such evidences on record. Secondly reasonable opportunity has to be given to the AO to verify/refute such evidences. The Id. CIT(A) did not allow any opportunity to the A.O. to examine the said audit report. In this regard, reliance is placed on following decisions: 1) Hon'ble Gauhati High Court in the case of CIT vs. Ranjit Kumar Choudhury (288 ITR 179). 2) Hon'ble Kerala High Court in the case of C. Unnikrisnan vs. CIT (233 ITR 485) 3) Hon'ble Mumbai High Court in the case of Prabhavati S. Shah vs. CIT (231 ITR 1) ii.) Therefore in the present case, there has been gross violation of principles of Natural Justice as the Id. CIT(A) has not allowed any opportunity to the AO to verify such evidences. Rule-46A(3) is mandatory and indispensable and non- compliance of same will require re-adjudication of the matter by the CIT(A). In this regard, reliance is placed on following decisions: 1) Hon'ble Himachal Pradesh High Court in the case of CIT vs. Shree Kangra Steel (P) Ltd. (320 ITR 691) (para-8) 2) Hon'ble Madras High Court in the case of CIT vs. Subbu Shashank (327 ITR 577) (para-6) 3) Hon'ble Delhi High Court in the case of CIT vs. United Towers (P) Ltd. (296 ITR 106) 4) Hon'ble Delhi High Court in the case of Manish Build Well (P) Ltd. (16 taxmann.com 27) Zafar Hayat 8 In view of above facts, this issue needs to be remanded to the A.O. for verification/ examination. 7. It was submitted by the ld. CIT-DR that as there was violation of provision of Rule 46A of IT Rules, 1962 and the audit report was not given to the AO for the counter. Therefore, ld. CIT-DR submitted that these issues in the appeal for A.Y.2009-2010 should be restored to the file of AO for readjudication. 8. In reply, ld. AR submitted that the remand report had been called for from the AO in the assessment year 2009-2010 and the audit report was produced before the AO. He has placed the copy of the remand report dated 25.04.2013 before us. 9. We have considered the rival submissions. As the ld. CIT(A) has called for the remand report from the AO in the assessment year 20092010 and as the audit report was before the AO for his rebuttal and the AO has given the objection in respect of the audit report, we are of the view that the ground raised in regard to violation of Rule 46A of IT Rules, 1962 does not survive any further. 10. It is further noticed that the issues in the appeal are squarely covered by the decision in the case of Sarosh Yazdani and Dillip Kumar Naik and in the case of S.M. Enterprises, referred supra, which are group concerns. In these circumstances, respectfully following the findings of the coordinate bench of the Tribunal in the above cases, on identical directions, the AO is directed to adopt the net profit @8% as against 10% adopted by the ld. CIT(A). Zafar Hayat 9 11. With regard to the protective addition, our findings recorded in the case of S.M.Enterprises, referred to supra, would apply pari passu to the impugned assessee also. 12. In the result, appeals of the assessee IT(SS)A Nos.56- 61&126/CTK/2013 are partly allowed and the appeals of the revenue in IT(SS)A Nos.75,76-77/CTK/2013 and IT(SS)A Nos.78-80 & 139/CTK/2013 are dismissed. ITA No.14/CTK/2014 (AY : 2009-2010) 13. This appeal is filed by the assessee against the order of the ld. CIT(A)-1, Bhubaneswar, dated 08.11.2013 for the assessment year 2009- 2010, wherein the ld.CIT(A) has confirmed the penalty levied u/s.271F of the Act. 14. It was fairly agreed by both the sides that the issue involved in the present appeal is covered by the decision of the coordinate bench of the Tribunal in the case of Sarosh Yazdani, passed in ITA Nos.12&13/CTK/2014, order dated 03.11.2022, wherein the coordinate bench of this Tribunal in para 7 has held as under :- 7. At the time of hearing, both the sides fairly agreed that the issue is squarely covered by the decision of the Co-ordinate Bench of this Tribunal in the case of S.M.Enterprises in IT A Nos.10 & 12/CT K/2014 As se ss ment Year s : 2008-09 & 2009-10 , order dated 20.10. 2022, w herein, the Co-ord inate Benc h in paras 10 to 12 h ave held as fo llow s : “10. It was submitted by ld AR that the issue in these appeals is squarely covered by the decision of the Co- ordinate Bench of this ITAT in the case of Gobardhan Matia vs ACIT in ITA Nos.573 & 574/CTK/2013 order dated 22.9.2022, wherein, the Co-ordinate Bench has held in para 4 as follows: Zafar Hayat 10 “4. We have considered the rival submissions. The levy/confirmation of penalty is based on the facts of each case. There is no presumption that the assessee is willfully violating the law. It is an admitted fact that notice u/s.153A has been served on the assessee and the assessee is required to file the return within 30 days. It is also an admitted fact that for obtaining of the Xerox copies of the seized document, it took more than 2-3 months. Just by obtaining of xerox copies of seized documents, the return cannot be filed. It has to be co-related, verified, examined and reconciled before the return is filed. The filing of return beyond the due date is admittedly invalid return as there is no provision for filing the return belatedly once notice u/s. 153A has been issued. This being so, we are of the view that the assessee had a valid ground for non-filing of return. Accordingly, penalty levied by the AO and confirmed by the ld CIT(A) is deleted.” 11. In reply, ld CIT DR vehemently supported the order of the AO and ld CIT(A). 12. We have considered the rival submissions. As it is noticed that the facts in assessee’s case are similar to the facts in the case of Gobardhan Matia (supra) in respect of levy of penalty under section 271F of the Act. Respectfully following the decision of the Co-ordinate Bench in the case of Gobardhan Matia (supra), the penalty as levied u/s.271F of the Act by the AO and confirmed by the ld CIT(A) stands deleted.” 8. As the facts of the present case are identical to the facts of the case of S.M.Enterprises referred to supra, and also in the case of Gobardhan Matia (supra), respectfully following the decision of the Co-ordinate Bench, in the above two cases, the penalty as levied u/s.271F of the Act by the AO and confirmed by the ld CIT(A) stands deleted. 15. We have considered the rival submissions. As the facts in the present case are identical to the facts in the case of Gobardhan Matia, passed in ITA Nos.573 & 574/CTK/2013 order dated 22.9.2022, respectfully following the findings recorded in the case of Gobardhan Matia (supra), the penalty levied u/s.271F of the Act stands deleted. 16. In the result, appeal of the assessee in ITA No.14/CTK/2014 is allowed. Zafar Hayat 11 ITA Nos.203 to 207/CTK/2020 (AYs: 2003-2004 to 2007-2008) 17. These appeals have been filed by the assessee against the separate orders of the ld. CIT(A)-1, Bhubaneswar, dated all 18.08.2020, whereby the ld. CIT(A) has confirmed the penalty levied u/s.271(1)(c) of the Act. 18. Ld.CIT-DR has filed his written submissions as follows :- i.) The question for adjudication in the present case is that where the Assessing Officer directs initiation of penalty proceedings in the assessment order but in the show cause notice, it is not indicated whether penalty is sought to be imposed for furnishing inaccurate particulars of income or for concealment of income by not striking off the inapplicable portion in the printed notice, whether it would vitiate the penalty proceeding and the consequential order of penalty or not. This issue has been decided in the favour of Revenue by the Hon'ble Murnbai High Court in the case of CIT vs. Srnt. Kaushalya (216 ITR 660) (paras 7 to 12). It was held by the Hon'ble Mumbai High Court that section 274 or any other provision in the Act or the Rules, does not either mandate the giving of the notice or its issuance in a particular form. Penalty proceedings are quasi-criminal in nature. Section 274 contains a principle of natural justice of the assessee being heard before levying penalty. Rules of natural justice cannot be imprisoned in any straight-jacket formula. For sustaining a complaint for failure of principles of natural justice on the ground of absence of opportunity, it has to be established that prejudice is caused to the concerned person by the procedure followed. The issuance of notice is an administrative device for informing the assessee about proposal to levy penalty in order to enable him to explain as to why it should not be done. Mere Ibis take in the language used or mere non-striking off of inaccurate portion cannot by itself invalidate the notice. ii.) This issue has also been decided in the favour of Revenue by the Hon'ble Madras High Court in the case of Sundararn Finance Ltd. vs. ACIT (93 taxmann.com 250) (para 16). It was held that even assuming that there was defect in the notice, it had caused no prejudice to the assessee and the assessee clearly understood what was the purport and import of notice issued under Section 274 r/w Section 271 of the Act. Therefore, principles of natural justice cannot be read in abstract and the assessee, being a limited company, having wide network in various financial services, should definitely be precluded from raising such a plea at a belated stage. The Hon'ble Madras High Court also noted the decision of Hon'ble Karnataka High Court in the case of CIT vs. Manjunatha Cotton & Ginning Factory (supra) while rendering its decision on the issue. Zafar Hayat 12 The SLP against the decision of High Court in this case has also been dismissed by Hon'ble Supreme Court (99 taxmann.com 152). iii.) The satisfaction for initiating the penalty proceedings is recorded by the A.O. in the assessment order. The notice which is being issued u/s.274 is merely to allow the assessee an opportunity of being heard. It is not mandatory to specify the nature of charges in such a notice. It must be borne in mind that no statutory form has been prescribed for such notice. This issue also stands settled by the decision of Hon'ble Mumbai High Court in the case of Maharaj Garage & Company vs. CIT (400 ITR 292) (para 15) wherein it was held that the requirement of Section 274 of the Income Tax Act for granting reasonable opportunity of being heard in the matter cannot be stretched to the extent of framing a specific charge or asking the assessee an explanation in respect of the quantum of penalty proposed to be imposed, as has been urged. The assessee was supplied with the findings recorded in the order of re-assessment, which was passed on the same date on which the notice under Section 271(1)(c) was issued, initiating the proceedings of imposing the penalty. The assessee had sufficient notice of the action of imposing penalty. Therefore the High Court did not find either any jurisdictional error or unjust exercise of power by the authority. iv.) Reliance is also placed on the decision of Hon'ble Bangalore IT AT in the case of M/s. jaysons Infrastructure India Pvt. Ltd. Vs. ITO in ITA No.997/Bang/2015 order dated 09.06.2017 and Shri P.M. Abdulla Vs. ITO in ITA No.1223 & 1224/Bang/2012 dated 17.10.2016 wherein it was held that absence of specific mention in the show cause notice u/s.274 of the Act about the charge u/s.271(1)(c ) of the Act is not fatal to levy of penalty u/s.271(1)( c) of the Act. v.) In the case of Earth moving Equipment Service Corporation (84 taxmann.com 51), the penalty u/s, 271(l)(c) was sustained by the Hon'ble Mumbai ITAT on the ground that the AO therein had levied penalty after due application of mind, in as much as in the assessment order, it was mentioned that penalty proceedings were being initiated for furnishing of inaccurate particulars of income and the penalty was finally levied on the same ground. Further the ITAT held that mere non marking of the relevant clause in the notice is a curable defect, and the action of the revenue is rescued by the provisions of section 292BB of the Act, which cures minor defects in the various notices issued, provided that such notice, in substance and effect, was in conformity with the intent and purpose of the Act. Thus the Hon'ble Bench concluded that penalty could not be deleted on this ground. vi.) It must be appreciated that concealment of income is the result of furnishing inaccurate particulars of income. It is evident that for assessment year 2004-05, the assessee had filed the original return of income showing total income of Rs.45,99,790/- on 04.01.2005. Zafar Hayat 13 The A.O. has computed the total income at Rs.79,24,640/-. Thus at the time of filing original return, the assessee was guilty of furnishing inaccurate particulars of income. The act of inflating the wages and power/fuel expenses and paying back cash to the extent of 50% against raising bills to M/s. Serajuddin & Co. clearly demonstrated that the assessee had concealed income to that extent. It has been held by the Hon'ble Iaipur ITAT in the case of Grass Field Farms & Resorts (P) Ltd. vs. DCIT (70 taxmann.com 176) on identical facts that where notice seeking to levy penalty mentioned both offences, i.e. one was concealing particulars of income and second for furnishing inaccurate particulars of income and since assessee was given adequate opportunity to explain both offences, there was no illegality in levying penalty with reference to only one offence. It was held that under the facts of the assessee's case, it may attract both the offences i.e. the concealment of income as well as furnishing of inaccurate particulars of income and, therefore, the Assessing Officer rightly initiated the penalty proceedings for both the offences. In the penalty notice also both the offences were mentioned and therefore, the assessee got the adequate opportunity to explain its stand with regard to both the offences. Thereafter the Assessing Officer levied the penalty only for furnishing of inaccurate particulars of income. In these facts & Circumstances, the issue was decided in the favour of the Revenue. The decision of Hon'ble Karnataka High Court in the case of Manjunatha Cotton & Ginning Factory (supra) which was delivered without considering the earlier decision of Hon'ble Mumbai High Court in the case of crr vs. Smt. Kaushalya (supra) is Per Incuriam and can't be considered as a binding precedent. vii.) Reliance is also placed on the decision in the case of Smt Ram Piari Vs CIT (327 ITR 318), wherein the Assessing Officer found undisclosed income from capital gains on account of sale of property and he imposed penalty which was upheld by the Commissioner (Appeals) as well as by the Tribunal. It was held by Honourable Punjab & Haryana High Court that the contention that the penalty was liable to be set aside on account of the Commissioner (Appeals) describing the action of the assessee as "showing inaccurate particulars, while the Assessing Officer described it as "concealing the particulars" could not be upheld. The observations of the Commissioner (Appeals) were also in the context of concealing and mere fact that mention of inaccurate particulars was also made, did not make any difference. It was clear that the assessee had concealed the particulars of income as well as given inaccurate particulars. The penalty provision was to provide remedy for loss of revenue for which the element of "wilful" concealment was not essential. viii.) It must be appreciated that even where. the income is estimated, the A.O. can levy penalty as held by Hon'ble Madhya Pradesh High Court in the case of CIT vs. Smt. Chandrakanta (205 ITR 607) by holding as under Zafar Hayat 14 " The facts stated above clearly disclose that the assessee first showed a loss of Rs.50,000. Then he revised the return, showing profit of Rs.7,500. Apparently, it has been found that the estimate of the income was incorrect and he had concealed the income and inaccurate particulars were furnished. In our opinion, the case clearly falls under clause (c) of subsection (1) of section 271 of the Act and, therefore, the penalty was levied. We fail to see the logic behind the reasons assigned by the Tribunal to exonerate the assessee from payment of penalty. When the assessee submitted his return and showed a loss of Rs.50,000 and then revised it and showed a profit of Rs.7,500, he had necessarily suppressed the particulars of income and given an incorrect account of his income. It may also be mentioned that the assessee did not maintain books of account. Income had, therefore, to be assessed on estimate basis. That being so, it is difficult to swallow that since the assessee's income was assessed on estimate basis, the assessee was not liable to any penalty. Instead, we find that the reasons assigned by the Tribunal have no basis under the law. We, therefore, have no hesitation in holding that the Appellate Tribunal took an absolutely incorrect view of law by exonerating the assessee from penalty. As we have stated earlier, the assessee did conceal his income and furnished inaccurate particulars and, therefore, was rightly subjected to penalty. In these circumstances, we hold that, on the facts and in the circumstances of the case, the Tribunal was not at all justified in cancelling the penalty levied under the Explanation to section 271(1)(c) of the Income-tax Act. In view of the above finding, question No. 2 need not be answered". The Hon'ble Madras High Court in the case of CIT vs. S. Krishnaswamy (219 ITR 607 holding the same view observed as under: " We have considered the rival submissions on the above aspect. Taking into account the facts found as well as the legal position, we have necessarily to accept the argument of learned counsel for the Revenue and reject that of learned counsel for the assessee. First of all, it is clear to us that this is not a case of the assessing authority estimating the income. As already mentioned, after the search and seizure of the abovereferred to documents and after the officer found the abovesaid omissions of substantial collections from buses to the extent of Rs.42,334 in one assessment year and Rs.1,01,787 in the other assessment year, the assessee came forward to file revised returns, including therein, the abovesaid omissions also. He only claimed certain allowances in relation to the abovereferred to omitted collections. As already seen, to a great extent, the said allowances were given, subject to only one qualification, viz., as against the claim for certain revenue expenditures to the extent of Rs.400 per day, what was allowed was Rs. 300 per day. In such a situation, it cannot be said that the revised assessment made based on the abovesaid revised return, was on an estimated income. Zafar Hayat 15 At any rate, even assuming that the revised assessment was based on an estimate made by the assessing authority, it cannot be said that in such a case, there could be no scope for saying that the assessee has concealed his income, warranting penalty under section 271(1)(c). In our opinion, in this regard, the Tribunal has erred in law in assuming that there are two views in the matter. One, as held in the abovereferred to CIT vs. E.V. Rajan [1985] 151 ITR 189 (Mad) ; Cement Distributors Pvt. Ltd. vs. CIT [1966] 60 ITR 586 (Mad); A.K. Bashu Sahib vs. CIT [1977] 108 ITR 736 (Mad); CIT (Addl.) vs. Bhoopathy (E.) [1978] 113 ITR 188 (Mad); Rathnam and Co. vs. lAC [1980] 124 ITR 376 (Mad) and CIT vs. Mir Mohamed Ali [1981] 128 ITR 215 (Mad) and another, as held in Bombay Hardware. Syndicate vs. CIT [1978] 114 ITR 586 (Mad) ; (14 ITR 133 (Mad) (sic.)) and Addl. CIT vs. T.K. Perumalswamy [1984] 150 ITR 600 (Mad). As pointed out in CIT vs. E.V. Rajan [1985] 151 ITR 189 (Mad) at page 195. itself, the "uniform view" taken by this court is that the "penalty provision has been applied even in cases where assessment is made on the basis of an estimate". In that decision, all the abovereferred to decisions of this court, which took a similar view earlier have also been referred to. Even in a later decision in CIT vs. Balakrishna Textiles [1992] 193 ITR 561 (Mad) relied on by learned counsel for the Revenue, the same view has been reiterated. The relevant observation therein is as follows (page 367): "Even if the Revenue had assessed the income at a higher estimate than that furnished by the asses sees, it cannot be stated as an inflexible rule that, in all cases, estimated income is not liable to penalty, as it is always open to draw an inference of deliberate underestimate on the facts and circumstances and if there was such an underestimate, an inference of concealment can also be drawn. We, therefore, are unable to appreciate the reasoning of the Tribunal that the estimate of the Revenue being higher than that of the asses sees, there can be no concealment." The Hon'ble Ahmedabad IT AT in the case of Shyourajsingh B. Chouhan (40 SOT 453) held as under in para-S of its decision: " As is evident from the aforesaid clause (c) of section 271(1) of the Act, the words used are 'has concealed the particulars of his income' or furnished 'inaccurate particulars of such income'. Thus, both in case of concealment and inaccuracy, the phrase 'particulars of income' has been used. The Legislature has not used the words 'concealed his income'. From this it would be apparent that penal provision would operate when there is a failure to disclose fully or truly all the particulars. The words 'particulars of income' refer to the facts which lead to the correct computation of income in accordance with the provisions of the Act. So when any fact material to the determination of an item as income or material to the correct computation is not filed or that which is filed is not accurate, then the assessee would be liable to penalty under section 271(l)(c) of the Act. If the income had to be assessed under section 145 of the Zafar Hayat 16 Act, th&n the presumption would be that the income was not properly returned, as held by Hon'ble jurisdictional High Court in CIT vs. Chandra Vilas Hotel [2007] 291 ITR 202 (Guj.). In this decision the Hon'ble High Court found that the assessee was not maintaining its account for six years and every year assessments were framed with the help and assistance of section 145(1) of the Act. Accordingly, the Hon'ble jurisdictional High Court observed that at least some order should have worked as an eye- opener for the assessee and that every year the assessee was repeating the same trend and still it wanted to say that it had not concealed the income or there was no fraud or gross or wilful neglect on its part. In the instant case also, the assessee was not maintaining the accounts during the course of the business year after year and in fact, the assessee was writing the accounts after the close of the year and inflating the expenses so as to show the income at his will. In these circumstances, it does not lie in the mouth of the assessee that it was not concealing his income by furnishing inaccurate particulars thereof, as concluded by the Assessing Officer and the Id. CIT(A)". The Hon'ble Ahmedabad Tribunal further held that there is no substance in the contention that penalty under section 271(l)(c) of the Act cannot be imposed in all circumstances whenever the income was assessed on estimate rejecting the explanation of the assessee. Even on estimated additions, levy of penalty has been upheld in the case of CIT Vs. Md. Warasat Hussain (171 ITR 405) (Patna High Court), CIT Vs. E.V. Rajan (151 ITR 189)(Madras High Court), CIT Vs. Hoshiarpur Express Transport Co. Ltd. (162 ITR 393) (Punjab & Haryana High Court), CIT Vs. Fazilka Dabwali Transport Co. (P.) Ltd. (178 ITR 656) (Punjab & Haryana High Court), and A.M. Shah & Co. Vs. CIT (238 ITR 415) (Gujarat High Court). It was further held that even the feeble plea on behalf of the assessee that penalty had been initiated for concealment of income while had been levied for furnishing inaccurate particulars of thereof was not correct since both the Assessing Officer and the CIT(A) had levied penalty because the assessee concealed his income by claiming inflated expenditure i.e., furnishing inaccurate particulars of such claim of expenditure. The CIT(A) held that the assess~e had deliberately manipulated its books of account in such a fashion that there was no other way but to estimate the income of the assessee and that the assessee concealed his income by claiming the inflated expenditure in his books of account. The Ahmedabad Tribunal further held that it agreed with the CIT(A) that this was not a case of pure and simple estimation but a case of estimation for the reason that the expenditure claimed was deliberately inflated and there were various wrong claims. In the light of the above discussions, it was held that all the material facts and particulars relating to the assessee's computation of income were never disclosed by the assessee and it was further clear that the explanation offered by the assessee had not been substantiated and as well as it was not found to be plausible and bona fide one Zafar Hayat 17 and it was against all human probabilities, especially when the conduct of the assessee showed that he had been inflating expenses and writing books well after the close of the year not only in the year under consideration but even in the preceding three assessment years also. In this view of the matter, the levy of penalty was held to be justified. The Hon'ble Supreme Court in the case of RA. Balasubramaniam Bros. & Co. vs. CIT [1999] 236 ITR 977, held that penalty can be imposed even on estimated addition also. It was held that where the assessee was not able to discharge the onus which was on it under the Explanation to section 271(1)(c) of the Act. The ITO was justified in imposing penalty, notwithstanding the fact that income was assessed on estimate basis. In view of above facts, the appeal of the assessee is required to be dismissed. 19. It was fairly agreed by both the sides that the issue involved in the present appeals are covered by the decision of the coordinate bench of the Tribunal in the case of Sarosh Yazdani, passed in ITA Nos.210 to 214/CTK/2020, order dated 03.11.2022 and the decision in the case of S.M.Enterprises, passed in ITA Nos.199-202&233&234/CTK/2020, order dated 20.10.2022, wherein the Tribunal in para 12 has held as under :- 12. As it is not iced th at the is sue is squ arely cove red by the decis ion of the Co-ord inate Be nch of this T ribuna l in a g roup conce rn M/s. S .M.Ente r prise s refer red to supra, w here in, i t h as been held as fo l low s: “5. In respect of penalty levied for the assessment years 2008- 2009 & 2009-2010, it was the submission of the ld. CIT-DR that in the assessment order the AO has mentioned that the penalty has been initiated both u/s.271(1)(c) of the Act and u/s.271AAA of the Act. It was the submission that mentioning of the wrong section in the penalty order is a curable defect. It was further submitted that the mistake in the penalty order should not be lead to the cancellation of the penalty order. For this proposition, he placed reliance on the decision of the Hon’ble Supreme Court in the case of T. Ashok Pai, reported in [2007] 161 TAXMAN 340 (SC). It was the submission that inadvertent and bonafide mistake has been held to be ground enough for cancellation of penalty u/s.271(1)(c) of the Act by the Hon’ble Supreme Court, the corollary being a bonafide mistake in Zafar Hayat 18 mentioning of the section in respect of levy of penalty by the AO should also be treated as bonafide mistake. 6. We have considered the rival submissions. For the assessment years 2008-2009 & 2009-2010, which are the years in respect of which the AO issued notice u/s.271(1)(c) as also penalty notice u/s.271AAA of the Act, but has levied the penalty u/s.271(1)(c) of the Act by its order dated 16.03.2015 and has not levied any penalty u/s.271AAA of the Act is considered, the penalty as levied by the AO is 100% of the tax sought to be evaded. The penalty leviable u/s.271AAA of the Act is only 10% of the undisclosed income. Thus, clearly the intention of the AO was to levy penalty u/s.271(1)(c) of the Act and it cannot be considered as a mistake on the part of the AO. A perusal of the provisions of Section 271AAA of the Act shows that when a search has been conducted on or after 1st June, 2007 but before 1 st day of July, 2012 then for the specified previous year being the previous year which has ended before the date of search but the date of filing of the return u/s.139(1) of the Act has not expired and the assessee has not filed his return as also the year in which the search was conducted are to be considered only u/s.271AAA of the Act. The provisions of Section 271AAA(3) of the Act specifically excludes the provisions of Section 271(1)(c) of the Act for the said two specified previous years. The search in assessee’s case having been conducted on 27.09.2008. Two specified previous years are AYs.2008-2009 & 2009- 2010. For these two assessment years, the penalty, if at all leviable, was u/s.271AAA of the Act and not u/s.271(1)(c) of the Act. Consequently, on this ground, the penalty as levied by the AO and as confirmed by the CIT(A) for the said two assessment years, stands deleted. Thus, ITA Nos.233 & 234/CTK/2020 stand allowed. 7. Coming to the appeals filed by the assessee in ITA Nos.199- 202/CTK/2020 for AYs. 2004-2005 to 2007-2008, a perusal of the notice issued u/s.274/271(1)(c) of the Act, dated 19.12.2014 for all the above assessment years, it is found that the AO has not struck off the inappropriate words in the penalty notices. A perusal of the decision of the Hon’ble Supreme Court in the case of Dilip N. Shroff, referred to supra, clearly shows that the non-striking off of the inappropriate words in the paragraph deprives the assessee a fair opportunity to explain its stand thereby violating the principle of natural justice. The decision of the Hon’ble Supreme Court in the case of Dilip N. Shroff (supra) when read with the decision of the Hon’ble Apex Court in the case of Reliance Petro Products Ltd. (supra), would show that the decision in the case of Dilip N. Shroff (supra) continues to hold good in spite of the decision of the Hon’ble Supreme Court in the case of Dharmendra Textiles (supra). 8. Further it is an admitted fact that there are catena of decisions both in favour of the assessee and against the Zafar Hayat 19 assessee in respect of issue as to whether the penalty u/s.271(1)(c) of the Act is leviable on an estimated income. The penalty admittedly is leviable on the facts of each case. A perusal of present case clearly shows that the estimation of income has been done by the assessee when it filed its return insofar as books are not available. Estimation has been done by the AO when making the assessment by following a particular method of estimation. This method of estimation by the AO has been disturbed by the ld. CIT(A) who has applied an alternative method of estimation of the assesee’s income. The coordinate bench of the Tribunal went further to revise the estimation as done by the ld. CIT(A). A perusal of the assessment order clearly shows that the estimation as done by the AO in the assessment order is not on the basis of any seized documents but by interpretation and presumption drawn out of the various seized documents. Thus, at no stage, it can be said that there has been a contumacious conduct on the part of the assessee, which can lead to the conclusion of concealment of income. In the circumstances, as the income of the assessee has been estimated at all stages and there is no evidence of concealment of income at any of its stages, right from the filing of return to the appeal before the Tribunal, we are of the view that no penalty is leviable. 9. It is further recognised that when there are catena of decision both in favour the assessee and against the assessee, the view in favour of the assessee is to be adopted as has been held by the Hon’ble Supreme Court in the case of Vegetable Products, reported in 88 ITR 192 (SC). In the circumstances, as no concealment has been proved in the case of the assessee, the penalty as levied by the AO and confirmed by the ld. CIT(A) stands deleted. Our decision to delete the penalty also gets support from the fact that the AO has not struck out inappropriate words in the paragraphs of notice issued u/s.274/271(1)(c) of the Act and on account of the fact that income of the assessee has been assessed only on estimation basis and no evidence of concealment of income has been found in the case of the assessee. In the circumstances, all the four appeals of the assessee for AYs.2004-2005 to 2007-2008 stand allowed.” 13. Respectfu ll y fol lo w ing the decision of the Co- ordinate bench re ferred to supra , the penalty levie d u/s.271(1 )( c) by th e AO and confi r me d by the ld CI T(A ) stands deleted. 20. As it is noticed that the issue in the present appeals are covered by the decision by the coordinate bench of the Tribunal in the case, referred to supra, respectfully following our findings recorded therein in the group Zafar Hayat 20 cases of the assessee, the penalty as levied u/s.271(1)(c) of the Act by the AO and confirmed by the ld. CIT(A) stands deleted. Thus, all the appeals of the assessee are allowed. ITA No.209/CTK/2020 (AY: 2009-2010) 21. This appeal has been filed by the assessee against the order of the ld. CIT(A)-1, Bhubaneswar, dated 02.09.2020 for A.Y.20092010, wherein the ld. CIT(A) has confirmed the penalty levied u/s.271(1)(c) of the Act. 22. It was submitted by the ld. AR that this is the “specified year” and the provisions of Section 271(1)(c) of the Act is not applicable. It was submitted by both the sides that the issue is squarely covered by the decision of the coordinate bench of the Tribunal in the case of S.M.Enterprises, passed in ITA Nos.233&234/CTK/2020, order dated 20.10.2022, wherein the coordinate bench of the Tribunal has in para 6 held as under :- 6. We have considered the rival submissions. For the assessment years 2008-2009 & 2009-2010, which are the years in respect of which the AO issued notice u/s.271(1)(c) as also penalty notice u/s.271AAA of the Act, but has levied the penalty u/s.271(1)(c) of the Act by its order dated 16.03.2015 and has not levied any penalty u/s.271AAA of the Act is considered, the penalty as levied by the AO is 100% of the tax sought to be evaded. The penalty leviable u/s.271AAA of the Act is only 10% of the undisclosed income. Thus, clearly the intention of the AO was to levy penalty u/s.271(1)(c) of the Act and it cannot be considered as a mistake on the part of the AO. A perusal of the provisions of Section 271AAA of the Act shows that when a search has been conducted on or after 1 st June, 2007 but before 1 st day of July, 2012 then for the specified previous year being the previous year which has ended before the date of search but the date of filing of the return u/s.139(1) of the Act has not expired and the assessee has not filed his return as also the year in which the search was conducted are to be considered only u/s.271AAA of the Act. The provisions of Section 271AAA(3) of the Act specifically excludes the provisions of Section 271(1)(c) of the Act for the said two specified Zafar Hayat 21 previous years. The search in assessee’s case having been conducted on 27.09.2008. Two specified previous years are AYs.2008-2009 & 2009-2010. For these two assessment years, the penalty, if at all leviable, was u/s.271AAA of the Act and not u/s.271(1)(c) of the Act. Consequently, on this ground, the penalty as levied by the AO and as confirmed by the CIT(A) for the said two assessment years, stands deleted. Thus, ITA Nos.233 & 234/CTK/2020 stand allowed. 23. Respectfully following the decision of the coordinate bench of the Tribunal in the above case, the penalty levied u/s.271(1)(c) of the Act by the AO and confirmed by the ld. CIT(A) stands cancelled. Thus, the appeal of the assessee in ITA No.209/CTK/2020 is allowed. ITA No.208/CTK/2020 (AY : 2008-2009) 24. This appeal is filed by the assessee against the order of the ld. CIT(A)-1, dated 18.08.2020 for A.Y.2008-2009, whereby the ld. CIT(A) has confirmed the penalty levied u/s.271AAA of the Act. 25. It was submitted by the ld. AR that the notice u/s.274 r.w.s.271 of the Act has been issued and the relevant portion has not been struck off to show as to whether the satisfaction is in regard to the concealment of income or furnishing inaccurate particulars. It was the submission that further the income of the assessee has been estimated and on estimated income no penalty is leviable. It was the submission that the issue is covered by the decision of the coordinate bench of the Tribunal in the case of S.M.Enterprises, passed in ITA Nos.199 to 202/CTK/2020, order dated 20.10.2022, wherein in respect of levy of penalty u/s.271(1)(c) of the Act has been cancelled on account of estimation of income. It was further submitted that the provisions of Section 271AAA of the Act are in Zafar Hayat 22 pari materia to the provisions of Section 271(1)(c) of the Act. It was the prayer that the penalty levied u/s.271AAA of the Act by the AO and as confirmed by the ld.CIT(A) is liable to be deleted. 26. In reply, ld. CIT-DR submitted that the provisions of Section 271AAA of the Act are not in pari material to the provisions of Section 271(1)(c) of the Act. It was the submission that the penalty u/s.271AAA of the Act is automatic. It was the submission that as undisclosed income has been assesseed in assessee’s case and the assessment year 2008- 2009 falls within the “specified year”, the penalty has rightly been levied u/s.271AAA of the Act. He placed reliance on the decision of the Hon’ble Gujarat High Court in the case of Ramgopal Ochhavlal Maheshwari, [2019] 109 taxmann.com 184 (Gujarat) and the decision of the Hon’ble Allahabad High Court in the case of Sandeep Chandak, reported in [2018] 93 taxmann.com 405(Allahabad). It was the submission that the penalty levied by the AO and as confirmed by the ld. CIT(A) is liable to be upheld. 27. We have considered the rival submissions. A perusal of the provisions of Section 271AAA of the Act clearly shows that if a search has been initiated u/s.132 of the Act on or after 1 st June, 2007 but before 1 st July, 2012, the assessee is to pay by way of penalty of an amount of 10% of the total undisclosed income in the specified previous year over and above the tax if any payable. There is no reference to a satisfaction to be recorded by the AO in the provisions u/s.271AAA of the Act. This being so, the argument of the ld. AR that the AO has not struck off the irrelevant portion of the show-cause notice, does not survive. Also, a perusal of the Zafar Hayat 23 provisions of Section 271AAA of the Act only talks of the levy of penalty at 10% of the undisclosed income. It does not talk of reasonable cause. In fact, the provision of Section 273B of the Act, is conspicuous by the absence of the provision of Section 271AAA of the Act which provides for reasonable cause. This being so, we are of the view that the penalty levied u/s.271AAA of the Act has rightly been levied by the AO and confirmed by the ld.CIT(A). However, when computing the penalty u/s.271AAA of the Act, the AO shall recompute the same after giving effect to the order of the coordinate bench of the Tribunal in assessee’s own case for the relevant assessment year. Thus, the appeal of the assessee is partly allowed. 28. In the result, appeals of the assessee IT(SS)A Nos.56- 61&126/CTK/2013 are partly allowed and the appeals of the revenue in IT(SS)A Nos.75,76-77/CTK/2013 and IT(SS)A Nos.78-80 & 139/CTK/2013 are dismissed. Further the appeals of the assessee in ITA Nos.14 & 203 to 207 & 209/CTK/2020 are allowed. And, appeal of the assessee in ITA No.208/CTK/2020 is partly allowed. Order dictated and pronounced in the open court on 04/11/2022. Sd/- (अरुण खोड़पऩया) (ARUN KHODPIA) Sd/- (जाजज माथन) (GEORGE MATHAN) ऱेखा सदस्य/ ACCOUNTANT MEMBER न्यानयक सदस्य / JUDICIAL MEMBER कटक Cuttack; ददनाांक Dated 04/11/2022 Prakash Kumar Mishra, Sr.P.S. Zafar Hayat 24 आदेश की प्रनतलऱपऩ अग्रेपषत/Copy of the Order forwarded to : आदेशान ु सार/ BY ORDER, (Assistant Registrar) आयकर अऩीऱीय अधधकरण, कटक/ITAT, Cuttack 1. अऩीऱाथी / The Appellant- 2. प्रत्यथी / The Respondent- 3. आयकर आय ु क्त(अऩीऱ) / The CIT(A), 4. आयकर आय ु क्त / CIT 5. पविागीय प्रयतयनधध, आयकर अऩीऱीय अधधकरण, कटक / DR, ITAT, Cuttack 6. गार्ज पाईऱ / Guard file. सत्यापऩत प्रयत //True Copy//