ITAT quashed the penalty levied u/s 271AAA (of Income Tax Act, 1961)

1. A search u/s 132 (of Income Tax Act, 1961) was conducted at the business & residential premises of Sh Harish Kumar Sarawgi.

2. In the search documents, loose papers etc were seized.

3. The assessee made a disclosure u/s 132 (of Income Tax Act, 1961) of Rs 12 crores as undisclosed income.

4. AO initiated penalty proceedings u/s 271AAA (of Income Tax Act, 1961).

5. CIT(A) confirmed the penalty.

On appeal, the ITAT held as under:

6. In the instant case, assessee had given the statement u/s. 132(4) (of Income Tax Act, 1961) by declaring the undisclosed income and has paid tax due along with interest.

7. However, if we analysis the manner in which the undisclosed income was derived, we find that the assessee claimed the business of coils as suggested from the seized documents mark SC-1 to Sc-9 and the same was not offered to tax.

8. We find from the above details that the explanation of the assessee has been accepted by the AO without making any addition.

9. It shows that the manner to substantiate the income has been duly explained by assessee before AO

10. We observe that the assessee has satisfied the conditions as laid down in section 271AAA(2) (of Income Tax Act, 1961).

11. Therefore the penalty order passed by Assessing Officer and subsequently confirmed by Ld. CIT(A) is quashed.

Case Reference - Harish Kumar Sarawgi V/s. DCIT.

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH "A" KOLKATA

Before Shri Mahavir Singh, Judicial Member and

Shri Waseem Ahmed, Accountant Member

ITA No.1746/Kol/2011

(Assessment Year :2008-09)