THE DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-3,, SURAT vs. M/S. IMPERIAL DEVELOPERS,, SURAT

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आयकर अपीलीय अिधकरण,सुरत �यायपीठ, सुरत IN THE INCOME TAX APPELLATE TRIBUNAL SURAT BENCH, SURAT �ीमती िदवा िसंह, �ाियक सद� तथा �ी ओ.पी.मीना, लेखा सद� के सम� BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER AND SHRI O.P.MEENA, ACCOUNTANT MEMBER S. आ.अ.सं./I.T.A अपीलाथ� Appellant Vs ��यथ�/Respondent No . No. & िनधा�रण . वष� /A Y: 1 1992/Ahd/2016 Deputy Commissioner Vs Imperial Developers, of Income Tax, . ‘Blossom’ Near Vesu Canal A.Y. 2013-14 Central Opp.DPS School, Circle-3, Surat – 395 Vesu, Surat. 001. [PAN: AADFI 5694 R] िनधा�रती क� ओर से /Assessee by Shri Mehul Shah - CA राज�व क� ओर से /Revenue by Shri Srinivas T.Bidari – Sr.DR

सुनवाई की तारीख/ Date of hearing: 09.01.2019 25.01.2019 उ�ोषणा क� तारीख/Pronouncement on: आदेश /O R D E R PER BENCH: This appeal filed by the Revenue pertaining to 2013-14 arising out of 1. order passed by the CIT(A)-4, Surat dated 18.05.2016 wherein the quashing of the penalty proceedings u/s.271(1)(c) has been assailed.

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assessee was required to give the relevant details of the persons from whom on-money was stated to have been received. It was his submission that the amount disclosed in the survey is an afterthought even though it was included in the income of the assessee under the head of business and profession but since details were not made available, the AO in the absence of relevant details held it taxable u/s.68 of the Income Tax Act. On the basis of this penalty proceedings have been initiated and the penalty has been levied. Inviting our attention to the penalty order and the reply of the assessee offered in the assessment proceedings vide letter dated 28.01.2015 was considered and not accepted the same reads as under : “1. With reference to your above referred show cause, we most humbly submit before your honor that we have not kept flat wise/ customer wise records in respect of the unaccountable income disclosed during the course of survey of Rs.10,03,31,960/-. We further state that we had fully offered this disclosed amount its books of accounts by creating the profit and loss account has fully paid the tax thereon amounting to Rs.3,10,02,576/- (Rs 3,00,99,588/- plus interest of Rs.9,02,988) at the time of filling the return of income. 2. Your honor may note that the firm is not doing any activity or business except development and sale of its project “Blossom” at vesu, for which disclosure has been made and therefore, there is no other source of income in the hands of our firm other than from the project “Blossom”. Therefore, if the additional income is being brought to tax on the basis of impounded diary, then the contents of the diary has to be accepted in totality and cannot be accepted in part. Hence, it is most humble submitted that the disclosed income is nothing but the business income of our firm and cannot be treated as income from other sources. 3. Without prejudice to our aforesaid contention, even otherwise we would like to bring to the kind notice of your honor the fact that the our firm has fully offered the disclosed income of Rs.10,03,31,960/- for the tax under the head ‘Business Income” without claiming any expanses, depreciation or set off of carry forward losses or any deduction under chapter VI-A and hence, treating the said income under any head would not alter the total tax liability. In the said scenario when there would even no change in the tax liability, there would even be no question of filing of inaccurate particulars of income or concealment of income for initiating penalty u/s 271(1)(c) as there would be no ‘tax sought to be evaded’ since, the tax on the returned income and tax on the assessed income would remain the same.” The explanation was not accepted. The learned AO issued a letter to 4. the appellant referring to the first penalty noticed issue along with the assessment order stating that penalty proceeding u/s.271(1)(c) of the Act were “initiated in your case vide notice dated 26-02-2015 and in this regard, you are once again granted an opportunity to put forth your case before the said penalty proceedings are finalized and therefore, the appellant was requested to attend the office of the undersigned in person or through its AR on 29-07- 2015 stating that in case of failure it will be decided that you have nothing to submit and the issue of levy of penalty will be decided on merits”. It may be noted that on 29-07-2015, the AR of the appellant could not appear before the AO on account of ill health and thereafter, the learned AO without issuing any show cause notice or any other letter whatsoever, straight away passed the impugned penalty order on 24-08-2015 levying a penalty of Rs.3,10,02,580/-

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u/s. 271(1)(c) of the Act alleging concealment of income by way of furnishing of inaccurate particulars of income.

Relying on the said para the ld.CIT-DR inviting our attention to the 5. impugned order submitted that relief has been granted by the CIT(A) for the reasons set out in para 7 to 8.1 which is assailed by the Revenue. The relevant extract which is common in these group of cases is extracted hereunder for ready reference : 7. Through the second ground of appeal, the appellant has pleaded that the penalty has been imposed against the principles of natural justice and has been passed without affording reasonable opportunity of being heard. 7.1 I have gone through the fact of the case, the penalty order and the submission. The appellant has pleaded that it did not appear in response to the first notice thinking that it is a routine first notice. The reason given for non-compliance/not replying to the second notice is stated to be the illness of the AR. However, it has not given any evidence nor it has claimed that any adjournment was sought. Neither is the AO required to wait till perpetuity nor he can dream of AR’s illness. The AO has given ample opportunity and therefore, the ground of appeal is dismissed. 8. The first ground of appeal is against the imposition of penalty on the fact of the case. As far as the imposition of penalty is concerned, the AO’s case is basically built on the following premise: a) Although it has shown the income accepted during the course of survey in its returns, it has not been able to substantiate with details and evidences, the claim that it has been earned as business income from the project'. It is alleged that the appellant failed to give the details of persons to whom the residential plots at Gokuldham, Varachha were sold and the details of on money receipt and how exactly the income has been worked out. b) The AO held that in absence of such details, the amount credited to the books of account (as income) is not explained and the addition of the income is required u/s. 68 of the Act. Consequently, the AO taxed it under the 'Income from Other Sources' as against it being declared as 'Business Income' during the course of survey as well as in the return of income. c) The AO held that in the above circumstances, the appellant has furnished inaccurate particulars of such income and went on to levy penalty @ 100% u/s.271(1)(c) for such default. d) The appellant has not appealed against the change of head of income in the quantum proceedings. e) The AO has relied on the decision of Hon'ble ITAT, ‘D’ Bench, Mumbai in the case of Armour Chemicals Ltd. vs. ACIT in ITA No.309/Mum/06 27 January, 2009; wherein the decision of Hon'ble Supreme Court in the case of Dharmendra Textile Processors & Others (2008) 306ITR 277 (SC) has been relied upon. 8.1 Considering the entire gamut of facts and circumstances, the following pertinent observations/decisions are made on the issue: a) The total income returned and the assessed income is the same. The penalty u/s. 271(l)(c) of the Act starts from the furnishing of details of income in the return and not before that. This is clear from the scheme of the Act and has been held and observed time and again including in the following cases: i) The Hon'ble High Court of Rajasthan in the case of CIT v. Unique Precured Retraders (2008) 13 DTR (Raj) 215. ii) The Hon'ble Jurisdictional High Court of Gujarat in the case of Principal CIT Vs. Valibhai Khanbhai Mankad 2015-TIOL 2164-HC-Ahm-IT has held that penalty u/s. 271 (1) (c) cannot be levied when there is no dispute with regard to fact that the particulars of income disclosed during the course of survey were duly reflected in the return of income. iii) The Hon'ble High Court of Delhi in the case of CIT Vs. SAS Pharmaceuticals (2011) 335 ITR 0259 (Del). The appellant had disclosed the incomes in the returns filed and paid taxes

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b) No penalty is leviable just because an issue was not appealed against the quantum order. Time and again it has been held that the penalty proceedings are separate from the assessment proceedings. This cannot be a ground for imposition of penalty. The AO has to independently establish its case for default u/s. 271(l)(c). The Hon'ble Supreme Court in case of CIT vs. Khoday Eswarsa & Sons 1972 CTR (SC) 295 : (1972) 83 ITR 369, the same position was reiterated. In that case, the Tribunal had stated that there might be justification for making additions in the original assessment order to the amount shown in the return, but those additions by themselves could not lead to the inference that the assessee had concealed its income or had deliberately furnished incorrect particulars. It was furthermore stated that cogent material or evidence is necessary before penalty can be levied. Another judgment which I would like to cite is the CIT vs. Koduri Papa Rao (1976) 102 ITR 834 (AP), a decision of the Andhra Pradesh High Court to the same effect. c) In this case, during the course of survey the appellant was confronted with impounded documents. At the very instance, it was accepted that this is income earned from the project from the ‘on money’ receipts. The survey team did not make further enquiries nor did it establish that these did not represent any other income nor it found/establish that the income disclosed was not full and true. The department can be imposed where the income has been disclosed merely because of change of head of income. This has been held in numerous cases including d) No penalty can be imposed where the income has been disclosed merely because of change of head of income. This has been held in numerous cases including 1) The Hon'ble High Court of Delhi in the case of CIT Vs. Amit Jain (2013) 351 ITR 0074 has held that merely because assessee has shown income in return as short term capital gain, which was assessed by AO as business income, it cannot amount to furnishing of inaccurate particulars for purpose of levy of penalty u/s.271 (1)(c). 2) The Hon'ble Mumbai Bench of the ITAT in the case of ITO Vs. Roborant Investments (P) Ltd. (2006) 7 SOT 181 (Mumbai) has held that the assessee having made full and complete disclosure, merely because income returned by assessee under a particular head was assessed by the AO under another head is not sufficient to impose penalty by invoking Expln. 1 to s. 271 (1 )(c). e) The reliance placed by the AO on the decision of Hon'ble ITAT, ‘D’ Bench, Mumbai in the case of Armour Chemicals Ltd. vs. ACIT in ITA No.309/Mum/06 27 January, 2009; is erroneous on the facts of the case. Unlike in that case no addition has been made to the total income returned nor the AO has build a case where it can be said that a portion of income has been taken away from the gaze of the revenue, as the AO has merely changed the head of income without a rupee being added to the income disclosed in the return. In the totality of facts and circumstances of the-case, the penalty u/s 271(1)(c) is held not imposable; where no addition has been made to the total income assessed vis-à- vis the returned income with respect to the impugned income, it involves allegation of a mere change of head without any tax effect, no explanation has been proved bogus or mala fide. Therefore it is directed to be deleted. 9. In the result, the appeal of the assessee is partly allowed.” The ld.CIT-DR in support of the departmental grounds assailing the 6. quashing of the penalty order submitted that the relief granted by the CIT(A) is contrary to the proposition of law as laid down by the Apex Court in the case of Mak Data Pvt. Ltd., 358 ITR 593 (SC). Accordingly it was his prayer that the impugned order may be set-aside and the penalty order may be upheld.

The ld.AR inviting our attention to the material available on record 7. submitted that in the facts of the present case, the assessee has consistently

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accepted the fact that on-money has been received from the business of sale of plots Blossom Project. It was his submission that in the related concerns no doubt various other objects may have been stated. However, it was consistently the fact on record that this was the only activity carried out by the assessee boking of plots at Blossom Project. Referring to the replies of the assessee in each of these cases, it was submitted that the assessee in the course of the assessment proceedings has carried out business as consistently made out the case that the respective assessees were engaged in plotting etc., It was submitted that since there was no other business except this business thus merely because the AO did not accept the source of the income and changed the head of income from business income to income from other sources etc., the penalty provisions u/s.271(1)(c) are not attracted.

The ld.AR further submitted that the assessee has declared additional 8. income based on notings in small diary in his original return of income which was filed on 14.10.2013 within due date of extended date by CBDT and same was accepted without making any addition although by change of head, therefore there was no dispute with regard to the fact that particulars of income were reflected in the return of income. Therefore, no penalty should be levied when the return of income was accepted by the AO as has been held by the Hon'ble Jurisdiction of Gujarat High Court in the case of PCIT-1 vs Valibhai Khanbhai Mankad (Tax Appeal No.445/2015 dated 07.09.2015) wherein the Hon'ble High Court observed in para 5 as under: “5. From the findings recorded by the Tribunal, it is evident that the factum of deletion of addition in respect of non-deduction of tax by the assessee was not controverted by the revenue. The Tribunal has further found that the penalty had been levied on the amount which was reflected in the original return as income. That it was an undisputed fact that the assessee had declared this income in his original return of income, although it was a belated return. The Tribunal was of the view that as per the provisions of section 271(1)(c) of the Act, penalty can be imposed if the assessee had concealed the particulars of income or has furnished inaccurate particulars of such income. That in the present case, there was no dispute with regard to the fact that the particulars of income were reflected in the return of income. Moreover, it was not the case of the revenue that the returns of income filed were invalid and in fact, the Assessing Officer had proceeded on the basis of the return filed by the assessee and particulars furnished therein. From the findings recorded by the Tribunal, it is evident that the Tribunal has found as a matter of fact that there was no concealment of particulars of income on the part of the respondent assessee and in fact, the Assessing Officer had proceeded on the basis of the return filed by the assessee and particulars furnished therein. Under the circumstances, in the absence of any concealment of the particulars of income or furnishing of inaccurate particulars of income on the part of the assessee, no infirmity can be found in the impugned order passed by the Tribunal in confirming the order passed by the Commissioner (Appeals) in deleting the penalty under section 271(1)(c) of the Act. In the absence of any infirmity in the impugned order passed by the Tribunal, it is not possible to state that the impugned order gives rise to any question of law much less, any substantial question of law so as to warrant interference. The appeal accordingly dismissed.”

The ld.AR further submitted relying on decision in the case of DCIT, 9. Circle-3, Surat vs. M/s.Suyog Corporation in ITA No.568/Ahd/2012 for A.Y.

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2008-09 to the proposition that the moment the additions have been made in the taxable income of the assessee, even on account of disclosure made by the assessee during the course of survey proceedings then that amount would be considered as business profit of the assessee. Hence, the disclosure made by the assessee on the basis of material found during the course of survey pertaining to plotting / construction / development are related to only business income as the AO has not brought out anything contrary to the record that the income disclosed during the course of survey was from the other sources. The ld.AR contended that the assessee has disclosed the amount surrendered during the course of survey in the return of income, hence, the assessee has not concealed the particulars of its income and furnished inaccurate particulars of such income as per Clause (C) of section 271 of the Act makes it clear that the act of the concealment of or furnishing of inaccurate particulars is relatable only in respect of return being filed and as such in case where the such of filing of return has not been breached, there was no question of invocation of penal provisions of section 271(1)(c) of the Act. In support of this contention, the ld.AR has placed reliance in the case of ACIT, Circle-4, Surat vs. Jupiter Distillery 1555/Ahd/2009 dated 16.12.2011 wherein relying on the decision of CIT, Ahmedabad vs Reliance Petro Products Ltd [2010] 322 ITR 158 (SC), the penalty levied on the amount disclosed during the survey and included in the return of income was deleted. The ld.AR further placed reliance on the decision in the case of ITO vs Roborant Investments Pvt. Ltd [2006] 7 SOT 181.

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provisions of section 271(1)(c) are not attracted. Further, as per Explanation 4 to section 271(1)(c) there is a mechanism for calculation of penalty, according to which the penalty could be calculated with reference to the income of which tax sought to be evaded whereas in the present case the assessee has duly paid taxes along with while filing the return of income, therefore there was no evasion of tax sought to be evaded. The ld.AR also placed reliance on the following decisions in support of contentions i.e. CIT vs. Unique Precured Retraders [2008] 13 DTR (Raj-215), CIT vs SAS Pharmaceuticals [2011] 335 ITR 259 (Del), M/s.Sadbhava Builders vs ITO 1418/Ahd/2008, Ahmedabad Tribunal, CIT Vs. Amit Jain [2013] 351 ITR 74 Del, CIT vs Reliance Petro Products Pvt. Ltd., [2010] 322 158 ITR (SC), CIT vs. Mhaskar General Hospital [Tax Appeal No.1474 of (2009)] (Guj) (HC), CIT vs. Hiralal Doshi – 383 ITR 0019 [BOM] (HC) and CIT vs. Aretic Investment (P) Ltd (2010) 78 CCH 197 (Del) (HC) and other as per their comes law paper book.

We have heard the parties and perused the material available on record 12. and gone through the above case laws. There is no dispute about the fact that there was a survey action u/s.133A, and the assessee offered additional income therein. The income so offered was duly declared in the return of income and the assessment was framed. Apart from his activity of plotting and development it was submitted that there was no other source of income. This position we find has not been disputed by the Revenue. The assessment of the assessee has also been completed u/s.143(3) duly accepting the declared income in the assessment order albeit with a change of head from business income to income u/s.68. Now the question which arises for consideration is whether is whether there is any justification on the part of the AO to levy the penalty u/s.271(1)(c)? when there is no difference in the return of income and assessed income. For the sake of convenience the provisions of section 271(1)(c) are produced as under : “”Sec. 271(1) –If the Assessing Officer or the Commissioner (Appeals) [or the Commissioner] in the course of any proceedings under this Act, is satisfied that any person – (a)…………. (b)………… (c) has concealed the particulars of his income or furnished inaccurate particulars of such income, or (d)………. He may direct that such person shall pay by way of penalty – Explanation – 1 –Where in respect of any facts material to the computation of the total income of any person under this Act,- (A) such person fails to offer an explanation or offers an explanation which is found by the Assessing Officer or the Commissioner (Appeals) or the Commissioner to be false or

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(B) such person offers an explanation which he is not able to substantiate and [fails to prove that such explanation is bona fide and that all the facts relating to the same and material to the computation of his total income have been disclosed by him]. Then the amount added or disallowed in computing the total income of such person as a result thereof shall, for the purposes of clause (c) of this sub-section be deemed to represent the income in respect of which particulars have been concealed.” 13. From the last portion of the section i.e.” the amount added or disallowed in computing total income be deemed to represent the income in respect of which particulars have been concealed” would indicate that it is only the addition or disallowance to the total income that would represent the income for the purposes of levy of penalty within the meaning of Explanation- 1 to section 271(1)(c). In other words, if no addition or disallowance is made in computing total income then there will not be any income which can be deemed as income in respect of which particulars have been concealed. Clause (c) to explanation-4 to section 271(1)(c) explains the amount of tax sought to evaded. It means the difference between tax on the total income assessed and the tax that would have been chargeable at such total income is reduced by the amount added. Since in the present case, the AO has not made any addition in the returned income, question of working out any tax sought to be evaded would not arise. For the sake of convenience we reproduce Explanation -4 to section 271(1)(c) as under :- “Explanation-4 – For the purposes of clause (iii) of this sub-section, the expression ‘the amount of tax sought to be evaded’- [(a) in any case where the amount of income in respect of which particulars have been concealed or inaccurate particulars have been furnished has the effect of reducing the loss declared in the return or converting that loss into income, means the tax that would have been chargeable on the income in respect of which particulars have been concealed or inaccurate particulars have been furnished had such income been the total income;] (b) in any case to which Explanation 3 applies, means the tax on the total income assessed [as reduced by the amount of advance tax, tax deducted at source, tax collected at source and self-assessment tax paid before the issue of notice under section 148]; (c) in any other case, means the difference between the tax on the total income assessed and the tax that would have been chargeable had such total income been reduced by the amount of income in respect of which particulars have been concealed or inaccurate particulars have been furnished.] Thus in general, where a case does not fall within clause (a) or clause (b) there cannot be any “tax sought to be evaded” if there is no addition to the returned income. 14. Thus the basis for levy of penalty is return of income. If any amount has been shown in the return of income, then it cannot be said that assessee has concealed any particular about that income or furnished inaccurate particulars in relation thereto. There cannot be any concealment prior to filing of return. Question of consideration whether assessee is liable for action under section 271(1)(c) would arise only when return of income is scrutinized by the AO and

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he finds some more items of income or additional income over and above what is declared in the return. If it is so, the assessee would be liable for action under section 271(1)(c) in respect of such items only which are discovered by the AO on the scrutiny of return of income or after carrying out investigation and discovering some more items of income not found declared or mentioned in the return of income. Prior to filing of return of income there is no concept of concealment or furnishing of inaccurate particulars.

The initial phrase used in section 271(1)(c) suggests that AO has to find 15. in the course of any proceedings under this Act that assessee has concealed the particulars of his income or furnished inaccurate particulars of such income. In fact, the proceedings against the assessee would start only after return of income is filed by the assessee or after issuance of statutory notice against him such as under section 142(1) or u/s 143(2). Carrying out survey under section 133A is not at all any proceedings. Proceedings as used in section 271(1)(c) are statutory proceedings initiated against the assessee either by issuance of statutory notice or after filing of return of income. Survey u/s.133A or search under section 132 or issuance of notice u/s.133(6) for example, are only means of collecting evidence against the assessee and are not equivalent to statutory proceedings. Another criteria of finding out ks to be seen whether it can be brought to a legal conclusion against the assessee by determining his right or liability. Merely carrying out survey under section 133A does not create any liability against the assessee which is created only through assessment proceedings or penalty proceedings. Therefore, the ld.DR is incorrect in his submission that survey being a proceedings and AO has discovered concealment during survey, therefore, the assessee is liable for penalty under section 271(1)(c).

We further find support from the reliance placed by the ld.AR on the 16. decision in the case of PCIT vs Valibhai Khanbhai Mankad [TIOL 2164-HC-AHM- IT [2015] wherein Hon'ble Gujarat High Court in para 5 the observed as under: “5. From the findings recorded by the Tribunal, it is evident that the factum of deletion of addition in respect of non-deduction of tax by the assessee was not controverted by the revenue. The Tribunal has further found that the penalty had been levied on the amount which was reflected in the original return as income. That it was an undisputed fact that the assessee had declared this income in his original return of income, although it was a belated return. The Tribunal was of the view that as per the provisions of section 271(1)(c) of the Act, penalty can be imposed if the assessee had concealed the particulars of income or has furnished inaccurate particulars of such income. That in the present case, there was no dispute with regard to the fact that the particulars of income were reflected in the return of income. Moreover, it was not the case of the revenue that the returns of income filed were invalid and in fact, the Assessing Officer had proceeded on the basis of the return filed by the assessee and particulars furnished therein. From the findings recorded by the Tribunal, it is evident that the Tribunal has found as a matter of fact that there was no concealment of particulars of income on the part of the respondent assessee and in fact, the Assessing Officer had

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proceeded on the basis of the return filed by the assessee and particulars furnished therein. Under the circumstances, in the absence of any concealment of the particulars of income or furnishing of inaccurate particulars of income on the part of the assessee, no infirmity can be found in the impugned order passed by the Tribunal in confirming the order passed by the Commissioner (Appeals) in deleting the penalty under section 271(1)(c) of the Act. In the absence of any infirmity in the impugned order passed by the Tribunal, it is not possible to state that the impugned order gives rise to any question of law much less, any substantial question of law so as to warrant interference. The appeal accordingly dismissed.” We further note that the ld.AR has placed reliance in case of CIT vs Amit 17. Jain [2013] 33 taxmann.com 178 (Del) wherein the Hon'ble Delhi High Court has held in para 3 as under : “3. This court notices that the Tribunal, while upholding the order of the Appellate Commissioner, relied upon the decision in CIT v. Reliance Petroproducts (P.) Ltd. [2010] 322 ITR 158/189 Taxman 322 (SC). Furthermore, the record reveals that the amount in question, which formed the basis for the Assessing Officer to levy penalty-was in fact truthfully reported in the returns. In view of this circumstance, that the Assessing Office chose to treat the income under some other head cannot characterize the particulars or reported in the return as an “inaccurate particulars” or as suppression of facts. The court is also conscious of the decision of the Supreme Court in Calcutta Discount Co. Ltd. v. ITO [1961] 41 ITR 191 where it was held that it is up to the Assessing Officer to interpret the return and discern as to which head of income the amount had to be brought to tax” Therefore, in the light of ratio of above decision no penalty is leviable 18. wherein even in the change of heads of income is made by the AO during the course of assessment proceedings.

The ld.DR has relied on the judgment of Mak Data Pvt. Ltd. vs. CIT [2013] 19. 358 ITR 593 (SC), however, same is not applicable in the present case as in that case the survey was conducted more than 10 months before filing of returns and the disclosure was made by the assessee later during the course of assessment proceedings, whereas in the present case the amount disclosed during survey was duly included in the original return of income filed after the date of survey. Therefore, the facts of the said case are distinguishable. Further, there is no difference in the return of income and the income.

In the light of above facts and circumstances and case laws we are of 20. the considered opinion that it is not a case of furnishing inaccurate particulars of income, as in the Income Tax Return, particulars of income have been duly furnished and the surrendered amount of income was duly reflected in the Income Tax Return nor there is a tax sought to be evaded on the basis of return of income as the assessee has not evaded any tax on the return income. The Hon'ble Delhi High Court in the case of SAS Pharmaceuticals [2011] 335 ITR 259 (Del) has considered the expression in the course of any proceedings under this Act appearing in section 271 of the Act and held that the said expression cannot have reference to the survey proceedings. It has also held that penalty proceedings would depend upon the return of income filed by the assessee.

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In the light of above facts and case laws relied by the ld.AR, we find no 21. reason to interfere with the order of ld.CIT(A) and we accordingly confirm the same. Accordingly, the grounds of appeal as raised by the Revenue are therefore dismissed.

In the result, appeal of the Revenue is dismissed. 22.

The order pronounced on 25-01-2019. 23. Sd/- Sd/- (ओ.पी.मीना/O.P.MEENA) (�ीमती िदवा िसंह/DIVA SINGH) (�याियकसद�यतथा/JUDICIAL MEMBER) (लेखासद�यकेसम� /ACCOUNTANT MEMBER) सुरत/ Surat, �दनांक Dated: 25th January, 2019/S.Gangadhara Rao, Sr.PS Copy of order sent to- Assessee/AO/Pr. CIT/ CIT (A)/ ITAT (DR)/Guard file of ITAT. By order / / TRUE COPY / / Assistant Registrar, Surat