RAJKUMAR KHILWANI,,BHOPAL vs. ASSISSTANT COMMISSIONER OF INCOME TAX CENTRAL CIRCLE - 2 VBHOPAL, BHOPAL

Per Paresh M Joshi, J.M:

ITA No:- 911/Ind/2025 ( Assessment Year : 2014-15)

This is an appeal filed by the Assessee under section 253 of

the income tax Act 1961,[ hereinafter referred to as the Act

for the sake of brevity] before this tribunal, as & by way of a

second appeal .The Assessee is aggrieved by the order in the

first appeal No:-CIT (A)-3, Bhopal/IT/10202/2013-14 dated

31.07.2024 passed by the Ld. CIT(A) u/s 250 of the Act,

which is hereinafter referred to as the “Impugned order”.

Page 1 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 The Relevant Assessment year is 2014-15 and the

corresponding previous year period is from 01.04.2013 to

31.03.2014.

2.1 That as and by way of an order made u/s 271AAB (1) of

the Act, a total penalty aggregating to Rs. 2,81,885/-

was imposed on the assessee u/s 271AAB(1)(c) of the Act.

The tabular form of the penalty is as under:-

The total inaccurate income on Rs. 3,77,000/- Unexplained cash 60% of above Rs. 2,26,200/-

The total inaccurate income on Foreign Rs. 75,000/- travel expenses 60% of above Rs. 45,000/-

The total inaccurate income on Rs. 17,808/- Unexplained Share Capital 60% of above Rs. 10,685/-

Page 2 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 2.2 That initially a search and seizure action u/s 132 of

the Act was conducted on the residential and business

premises of the assessee and associated concern on

29.01.2014. That the assessee is an individual and having

income from the business & profession, partnership firm and

other sources. The assessee had filed his ROI on

30.11.2014 and had declared total income of Rs. 2,

14,090/-.

2.3 That in the case of the assessee the assessment order

u/s153 rws 143(3) of the Act for Assessment Year 2014-15

was passed on 23.03.2016 with total assessed income of Rs.

29,85,840/-. The additions were made on the following

issues:-

 Foreign travel expenses: Rs. 2,50,000/-

 Unexplained jewellery : Rs. 14,63,442/-

 Unexplained Shale Capital : Rs. 1,81,308/-

 Unexplained Cash : Rs. 8,77,000/-

Page 3 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 2.4 However, the assessee being aggrieved by the aforesaid

Quantum Assessment order dated 29.03.2016 preferred the

first appeal to the Ld. CIT (A) Bhopal against the said

assessment order dated 23.03.2016. The Ld. CIT (A) however

gave a partial relief to the assessee but however confirmed

the following additions which were modified as under:-

 Foreign Travel Expenses:- Rs. 75,000/-

 Unexplained Cash : Rs. 3,77,000/-

 Unexplained Shale Capital : Rs. 17,808/-

2.5 That a show causes notice dated 12.03.2020 was issued

to the assessee calling upon the assessee to show cause as to

why the penalty under section 271AAB(1) of the Act should

not be imposed on it.[PAPER BOOK Page 67]

2.6 That the assessee in his submission received on

18.03.2020 interalia contended that the additions are made

not on basis of anything like money, bullion, jewellery or any

entry in the books of accounts or other documents or

transactions found during the course of search. The

Page 4 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 additions have been made solely on the basis of entries

appearing in the passport of the assessee, further no

document or transaction was found indicating that the

assessee had incurred expenses which were all estimated by

the Ld. Assessing Officer. The additions are pure estimation

basis without reference to the seized record and hence no

penalty be imposed.

2.7 The Ld. Assessing Officer in the penalty order dated

24.12.2020 has held as under:-

“6.0 Conclusion

6.1 The reply of the assessee has been duly

considered but not found acceptable. Since, the

assessment was completed on the basis of

evidences on record and since the assessee has

not admitted undisclosed income u/s 132(4) of

the Act and not substantiated the manner in

which it was derived and has not declared

undisclosed income in the ROI filed, provision

of section 271AAB (1) (c)is applicable in this

Page 5 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 case. Section 271AAB (1) (c) of Income Tax Act,

1961 is as under:

(1) The Assessing Officer may,

notwithstanding anything contained in

any other provisions of this Act, direct

that, in a case where search has been

initiated under section 132 on or after the

1st day of July, 2012 but before the date

on which the Taxation Laws (Second

Amendment) Bill, 2016 receives the assent

of the President, the assessee shall pay by

way of penalty, in addition to tax, if any,

payable by him,-

c) a sum computed at the rate of sixty per

cent of the undisclosed income of the

specified previous year, if it is not covered

by the provisions of clauses (a) and (b).

6.2 Considering the fact that assessee has

concealed the true facts of his income, while

Page 6 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 filing the ROI u/s 139(1) of the Income Tax Act,

1961. Having regard to the above and

considering the totality of the facts and

circumstances of the case I am satisfied that

the assessee has knowingly and intentionally

concealed its correct income to the tune of Rs

4,69,808/- in the return of income filed u/s

139(1) of Income Tax Act, 1961 for the A.Y.

2014-15 for which it is liable for penalty u/s

271AAB of the Income tax Act. 1961. The

appeal of the assessee before Id.CIT(A) has been

partly allowed. The penalty u/s 271AAB(1)(c) is

therefore being levied on the issues confirmed

by the CIT(A) and issues in which the assessee

has not preferred appeal which are as under:

The total inaccurate income Rs. 3,77,000/- on Unexplained cash 60% of above Rs. 2,26,200/-

Page 7 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 The total inaccurate income Rs. 75,000/- on Foreign travel expenses 60% of above Rs. 45,000/-

The total inaccurate income on Rs. 17,808/- Unexplained Share Capital 60% of above Rs. 10,685/-

the case, I levy a penalty of Rs. 2,81,885/- (Rs

two lakh eighty one thousand eight hundred

eighty five only) under section 271AAB(1) (c) of

the Income tax Act 1961.

approval of Add.CIT (Central), Bhopal vide

document no. ITBA/PNL/S/992/2020-

21/1027292774(1) dated 15.06.2020.”

Page 8 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 2.8 That the aforesaid order u/s 271AAB(1)(C) of the Act

bears No:- ITBA/PNL/F/271AAB(1)/2020-21/1029233931(1)

and that the same is dated 24.12.2020 which is hereinafter

referred to as the “Impugned Penalty Order” u/s

271AAB(1) of the Act”.

2.9 That the assessee being aggrieved by the aforesaid

“Impugned Penalty Order” prefers the first appeal u/s

246A of the act before the Ld. CIT (A) who by the

“Impugned Order” has dismissed the first appeal of the

assessee on the grounds and the reasons stated therein. The

core grounds and the reasons for the dismissal of the first

appeal were as under:-

“The Ld AO has initiated penalty proceedings

u/s 271AAB of the 'Act' as the appellant has

concealed the said income. Being aggrieved

with the assessment order passed u/s 143(3),

the appellant preferred appeal before CIT(A).

The CIT(A) gave partial relief and confirmed the

following additions:

Page 9 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 Foreign travel expenses: Rs.75,,000/-,

Unexplained cash: Rs.3,77,000/-and

Unexplained Share Capital: Rs.17,808/-.

In compliance to decision of CIT(A) in this case,

the Ld.AO has issued show cause notice on

12/03/2020. In response to show cause notice

dated 12/03/2020, the appellant submitted

reply which was considered by the Ld.AO but

was not accepted as merit of the matter

involved has already been decided against the

assessee by CIT(A)-3,Bhopal. Accordingly, the

Ld.AO has levied penalty of Rs.2,81,885/- u/s

271AAB of the Act for A.Y.2014-15.

Thus, the contention of the appellant that

levying the penalty was not justified is not

acceptable as the appellant not disclosed

concealed income in the return of income filed.

The nature of addition already indicates

concealment of income in this case.

Page 10 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 In view of above discussions, I find no merit on

the grounds raised by the appellant. Therefore,

passing the penalty order u/s 271AAB(1) of the

'Act' and levying penalty of Rs.2,81,885/- is

fully justified & proper and in accordance with

the provisions made under the Income Tax Act.

Accordingly, the appeal on this ground is

dismissed.”

2.3 That the assessee being aggrieved by the “Impugned

Order” has preferred the instant second appeal before this

tribunal and has raised the following grounds of appeal in

the form no. 36 against the “Impugned Order” which are as

under:-

“1. That on the facts an in the circumstances of the

case of the assessee the Ld Commissioner of Income

Tax was not justified in deciding the appeal,

ignoring the adjournment application filed on

14.05.2025.

Page 11 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 2. That on the facts an in the circumstances of the

case of the assessee the Ld Commissioner of Income

Tax was not justified in confirming levy of penalty

on additions which have been set aside/deleted by

the ITAT.

case of the assessee the Ld Commissioner of Income

Tax was not justified in confirming the levy of

penalty without first deciding whether the

additions made constituted "Undisclosed Income" as

defined under the Act.

case of the assessee the Ld Commissioner of Income

Tax was not justified in confirming levy of penalty

on additions made on estimated basis.

case of the assessee the Ld. Commissioner of Income

Page 12 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 Tax was not justified in confirming the levy of

penalty of RS. 2,81,885/-.

withdraw any ground of appeal on or before the

time of hearing.”

3.1 The hearing in the matter took place before this Tribunal

on 28.09.2026 when the Ld. AR for & on behalf of the

Assessee appeared before us and interalia contended that

the “Impugned Order” is bad in law, illegal and not proper.

It therefore deserves to be set aside.

3.2 The Ld. AR also informed us that today three appeals

are listed for hearing and in so far as ITA No:- 913/Ind/2025

is concerned it pertains to AY 2009-10 wherein penalty is

under 271(1)(c) and so also in ITA No:- 912/Ind/2025 AY

2013-14 wherein too the penalty is under 271(1)(c). In the

Page 13 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 instant appeal No:- 911/Ind/2025 AY 2014-15 the

penalty is u/s 271AAB(1) of the Act. It was decided with

the consent of both the parties that all the three appeals be

taken together and be heard. The Ld. AR then submitted to

us that in so far as Quantum Assessment proceedings are

concerned finally the Ld. CIT (A) has confirmed the additions

on three scores i.e. (1) Foreign travel expenses of Rs.

75,000/-

(2) Unexplained cash of Rs. 3,77,000/-

(3) Unexplained share capital of Rs. 17,808/-

And basis that @ of 60% the respective penalty’s are imposed

and stands confirmed by the Ld. CIT(A) in quantum

proceedings.

The ground No:-2 that these additions which were

confirmed by the Ld. CIT (A) have been set aside/deleted

by the ITAT and hence the said ground No:-2 above is

not pressed. Our attention was then invited to PB page 35

which is copy of “Impugned Assessment Quantum

Order” dated 23.03.2016 u/s 153A rws 143(3) of the Act.

Our kind attention was then invited to PB page 42

Page 14 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 [Back side] Para 9 which deals with “foreign travels

expenditure by the assesse and family members” and that

the same was read out. Copy of passport was submitted by

the assesse. Basis Para 9(iii) PB page 43 it was submitted

that anestimation was made by the Ld. AO. Hence basis

estimation the penalty cannot be imposed.

3.3 It was further submitted that the imposition of penalty of

Rs. 75,000/- is therefore incorrect on the score of foreign

travel expenses. Even though the addition on this score is

confirmed by the Ld. CIT (A) only to the extent of Rs.

75,000/- against Rs. 2,50,000/- as per Quantum

Assessment Order dated 23.03.2016.

3.4 With regard to the second score of unexplained cash an

amount of Rs. 8,77,000/- as addition was confirmed by the

Ld. AO by virtue of Para 7 of the Impugned Quantum

Assessment Order dated 23.03.2016 which was modified

by the Ld. CIT (A) to Rs. 3,77,000/-. In this regard our

attention was invited to the PB page 40 and correspondingly

Page 15 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 to the observation of the Ld. CIT (A) order on Quantum dated

26.12.2018 PB page 22 to 34. Basis PB page 33 & 34 Para

12.3 which was read out wherein the amount of Rs.

8,77,000/- is modified/reduced to Rs. 3,77,000/- on ground

that amount of Rs. 50,000/- belongs to children which was

received by them from various persons on various occasions.

Gifts are received by children in family from Rs. 101/- to

5001/- which they keep with Parents hence the amount of

Rs. 5,00,000/-was deleted and addition of Rs. 3,77,000/-

was confirmed.

3.5 With regard to the issue of “unexplained share capital”

our attention was drawn to PB page 50 & 51 Para 12 of the

Quantum Assessment Order dated 23.03.2016 and same was

read out, correspondingly our attention was invited to PB

page 27, 29 which was the Ld. CIT (A) order dated

26.12.2018 on the Quantum and Para 8.4 was relied upon

page 29 of the Paper book wherein the amount was restricted

to Rs. 17,808/- from Rs. 1,81,308/- on this score.

Page 16 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 3.6 In summation of the arguments the Ld. AR submitted

that

(1) There is no satisfaction of the Ld. AO in the Impugned

Quantum Assessment Order either on charge of

concealment or inaccurate particulars. Reliance was placed

on the judgement of jurisdictional High Court in case of

Kulwant Singh Bhatia and case of Manjunath Cotton of Apex

Court & Karnataka High Court wherein SLP in the Hon’ble

Supreme Court was dismissed. With regard to 271(1)(C) of

the Act there is no satisfaction of the Ld. AO in Quantum

assessment order dated 23.03.2016 and hence no penalty is

called for u/s 271(1)(C) of the Act.

(2) The additions are made in the quantum assessment order

dated 23.03.2016 all modified basis estimation by the Ld.

CIT (A) and made by the Ld. AO (Quantum).

(3) With regard to AY 2014-15 i.e. ITA No:- 911/Ind/2025

our attention was again invited to PB page 39 caption cash

at residence and locker and again correlation with Para 12.3

of the Ld. CIT (A) order dated 26.12.2018 PB page 22 to 34,

which ultimately are basis estimation only.

Page 17 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 (4) Section 271AAB(1)(c) as it stood. At relevant time

postulated minimum penalty to be computed @ 30%

instead of 60% was emphasised. The undisclosed Income

stands defined too u/s 271AAB (1) (c). Foreign tour expenses

etc. are found during the assessment year basis estimation

only. It is not found in course of search proceedings hence

no penalty.

3.7 Per contra the Ld. DR for the revenue contended that in

ITA No:-913/Ind/2025 AY 2009-10 and in ITA No:-

912/Ind/2025 AY 2013-14 penalty’s are under section

271(1)(c) of the Act whereas in ITA No:- 911/Ind/2025 AY

2014-15 the penalty is u/s 271AAB(1) of the Act. The

additions are confirmed by the Ld. CIT (A) in the Quantum

proceedings are basis merits and it cannot be called

estimation at all. Foreign travel and share capital are all

cash transactions. There is non-disclosure of foreign tour in

totality. No details furnished on foreign countries travelled.

Sources of cash not disclosed for the share capital. It is not

estimation. Fixed amounts are identified. There is a

Page 18 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 satisfaction of the Ld. AO. Attention was invited to PB

page 55 which was a show cause notice dated 12.03.2020

for AY 2009-10 where charge of concealment of

particular of income are brought out expressly.

Simultaneously our attention was invited to PB page 61

which was a show cause notice dated 12.03.2020 for AY

2013-14 wherein too the charge of concealment of

particulars of income are brought out expressly. It was

submitted that addition/subsistence of the addition of Rs.

3,77,000/- partakes the character of undisclosed income

and therefore total addition was of Rs. 8,77,000/- as

unexplained cash was made in AY 2014-15. The Ld. CIT (A)

had given leeway towards gift to children in family of Rs. 5

Lakh which is a decent amount basis Para 12.3 of the Ld.

CIT (A) order dated 26.12.2018. The Ld. DR in the

summation stated that penalty be upheld. In the rejoinder

argument the Ld. AR submitted that in the Quantum

Assessment Order no specific satisfaction is recorded. Day to

day cash flow was not filed. For foreign travel expenses part

debit in firm’s accounts though bifurcation was not given. It

Page 19 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 was emphasised at tag end of the hearing that for AY 2014-

15 minimum penalty was liveable at 30% for the AY 2009-10,

and for the AY 2013-14 levy u/s 271(1)(C) of penalty is @

30% (calculating tax). Hearing was over and closed.

4.1 We have to decide the legality, validity and proprietary of the

“impugned order” basis records of the case & the rival

submission canvassed before us.

4.2 We have carefully perused the records of the case and have

heard the submissions.

4.3 We basis records of the case & after hearing & further

upon examining the rival contentions of the Ld. AR & the Ld.

DR canvassed before us are of the considered opinion that

the “Impugned Penalty Order u/s 271 AAB(1) of the Act”

warrants levy of minimum penalty @30% and not 60% as

substantial relief has been given to the assessee by the

Ld. CIT(A) by Quantum appellate order dated 26.12.2018

[PB page 22 to 34] while it is true that the Quantum

Page 20 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 assessment order dated 23.03.2016 was under section 153A

RWS 143(3) of the IT Act 1961 for AY 2009-10, AY 2013-14,

AY 2014-15 which is popularly called “search assessment

case” in tax parlance. However, we are of the considered

opinion that the Ld. CIT (A) in his first appeal appellate order

dated 26.12.2018 has given leeway basis after considering

the entire gamut of the case in hand on merits. The

contention of the Ld. AR that estimation has played role at

both the Quantum assessment order and at Impugned Order

of the Ld. CIT (A) on Quantum is wrong. The additions is on

three broad issue for AY 2014-15 which were “foreign travel

expense”, “unexplained cash” and “unexplained share

capital” which in the essence are attracting the material

ingredients of section 271AAB(1)(c). Further 271AAB

explanation (c) the undisclosed income means:-

“(c) "undisclosed income" means— (i) any income of the specified previous year represented, either wholly or partly, by any money, bullion, jewelry or other valuable article or thing or any entry in the books of account or other documents or transactions

Page 21 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 found in the course of a search under section 132, which has— (A) not been recorded on or before the date of search 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 Commissioner before the date of search; or (ii) any income of the specified previous year represented, either wholly or partly, by any entry in respect of an expense recorded in the 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.”

In order to come out of the ambit and scope of the section

271AAB(1)(c) the burden is on the assessee that the

additions and/or modification of additions done by the Ld.

CIT (A) by partly allowing the Quantum first appeal has given

a clear cut exoneration to the assessee on undisclosed

Page 22 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 income as defined which the Ld. AR has failed to

demonstrate basis law, On the contrary a plea of estimation

is taken at both levels of the lower authorities i.e. the Ld. AO

and the Ld. CIT (A) which save and except the word

“estimation” is not empirically proved/Established on

merits before us. Hence we reject plea of the assessee on the

“theory of estimation” so canvassed. Modification of the

Quantum assessment order of the Ld. AO whereby the

additions are reduced perse does not mean estimation of

income. The Ld. CIT (A) on merits has given modification of

the Impugned Quantum Assessment Order which by any

stretch of imagination cannot be called “estimation” of

income in search case. Even the Impugned Quantum

Assessment Order is basis merits of the case. The Ld. CIT (A)

in the Impugned Order has rightly held such modified

income by the Ld. CIT(A) __ modified additions were not

declared in the ROI rather it has been held that the same

were undisclosed income which became known upon

search only. However, we are of the considered opinion in

the given facts and circumstances that since at the material

Page 23 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 time AY 2014-15 the minimum penalty was 30% same

ought to be levied instead of 60%. Accordingly the Impugned

Order is modified by us in the facts & circumstances of the

case and we fix the minimum penalty of 30%. The appeal of

the assessee is partly allowed as nature of additions so

sustained by Ld. CIT(A) in the impugned falls under

undisclosed income and mischief of section 271AAB(1)(C) of

the Act. The Ld. AR has failed to assail the “Impugned

order” basis any cogent grounds on merit. Ground No. 2 is

too not pressed.

4.4 ITA No:- 912/Ind/2025 (AY 2013-14)

In this appeal as and by way of the order u/s 271(1)(c) of the

Act the total penalty is of Rs. 61,800/-. The Quantum of

total concealed income is Rs. 2,00,000/-. Three time of tax

as penalty is worked out at Rs. 1,85,400/- [minimum]. Tax

on above is Rs. 61,800/-. By Impugned Order dated

31.05.2025 the first appeal is dismissed. The Ld. DR basis

PB page 61 which is a copy of the show cause notice dated

12.03.2020 for AY 2013-14 has demonstrated that there is a

charge of concealment/concealed the particular of

Page 24 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 income which is a specific charge i.e. one limb out of

two u/s 271(1)(c) of the Act.[PB page 61] invoked,

expressly. The Ld. AR has emphasised on the judgement of

Hon’ble MP High Court in case of PCIT v/s Kulwant Singh

Bhatia reported in (2018) 33 ITJ 777(MP) and that of

Karnataka High court in case of CIT v/s Manjunatha Cotton

ginning factory (2013) 359ITR 569(KAR) later Apex Court

dismissed the SLP. We have perused both the orders of the

Hon’ble High Court of MP and Karnataka wherein sum and

substance it has been held that the show cause notice u/s

271(1)(c) of the Act should be specific on the charge. It

should not be vague and cryptic. However in the above show

cause notice dated 12.03.2020 we find charge of

concealment of Income as specific. Only one limb out of

two of Section 271(1)(c) is stated, under these facts we

are not inclined to appreciate the argument of the Ld.

AR. Further we find that in so far as Impugned Order on the

penalty of the Ld. CIT (A) dated 13.05.2025 is concerned

same is not assailed on any meritorious grounds. In the

Quantum assessment Order dated 23.03.2016 for the AY

Page 25 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10 2013-14 we observe satisfaction for penalty u/s 271(1)(c)

is pointed out [PB page 44]. Therefore contentions of the

Ld. AR that no satisfaction is recorded in the Quantum

Assessment Order is devoid of merits. In the Impugned

Order charge on concealment of income in ROI/ ROI u/s

153A is found to be correct. Nature of addition to speaks of

concealment of income. Merely because Quantum appellate

order has reduced the addition perse does not mean that

charge of concealment of income too disappears and no

penalty is to be imposed. Hence we uphold the Impugned

Order and dismiss the Appeal.

4.5 ITA No:- 913/Ind/2025 (AY 2009-10)

In the above appeal too the facts and circumstances are

more or less pari materia save and except the order

imposing penalty by the Ld. AO and Impugned Order of the

Ld. CIT (A). Hence our finding in ITA No:- 912/Ind/2025

would apply mutatis mutandis to this appeal too.

Page 26 of 27

RAJKUMAR KHILWANI ITA No. 911, 912 & 913/Ind/2025 - A.Y. 2014-15, 2013-14 & 2009-10

4.6 In the result ITA No:- 911/Ind/2025 is partly allowed as

penalty to be at Minimum 30% instead of 60%.

ITA No:- 912 & 913/Ind/2025 is rejected.

5 Order

5.1 ITA No: - 911/Ind/2025 is partly allowed & ITA 912 &

913/Ind/2025 is dismissed.

Pronounced in open court on 22.10.2026.

Sd/- Sd/- (ARVIND SONI) (PARESH M JOSHI) ACCOUNTANT MEMBER JUDICIAL MEMBER

Indore Dated: 22/10/2026

Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY Senior Private Secretary Income Tax Appellate Tribunal Indore Bench, Indore

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