DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 1(1), KOLKATA, KOLKATA vs. RADHESHYAM AGARWALA, KOLKATA

Facts

The revenue filed appeals challenging the CIT(A)'s orders that deleted penalties levied by the Assessing Officer under Section 271(1)(c) and Section 270A for assessment years 2016-2017 to 2020-2021. The penalties arose after a search on the assessee's son led to an undertaking for disclosures by the assessee (father), who subsequently filed returns under Section 153C. These 153C returns, disclosing various amounts, were accepted without further additions by the AO.

Held

The Tribunal upheld the CIT(A)'s deletion of penalties. It held that once income declared in a return filed under Section 153C is accepted without any additions, that return is considered equivalent to a return filed under Section 139(1), and consequently, no penalty for concealment or furnishing inaccurate particulars of income is leviable. The Tribunal found no error in the CIT(A)'s findings, which included the absence of a direct search on the assessee and the lack of incriminating material used for any additions.

Key Issues

Whether penalties under Section 271(1)(c) or Section 270A are applicable when an assessee files a return under Section 153C disclosing income, and such return is accepted by the Assessing Officer without any further additions, particularly in cases where no search was conducted directly on the assessee.