M/S. DHANLAXMI DEVELOPERS,PUNE vs. DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE - 8, PUNE

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ITA 1888/PUN/2018Status: DisposedITAT Pune15 July 2022AY 2013-143 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that since the assessee's declared income in the return was accepted by the AO, there was no escaped income. Therefore, no penalty was leviable.

What were the facts?

A survey was conducted on the assessee's premises, during which undisclosed income was declared. The assessee subsequently filed a return of income including this declared income, which was accepted by the AO. The AO then initiated penalty proceedings under Section 271(1)(c) for escaped income.

What were the issues?

Whether penalty under Section 271(1)(c) is leviable when the declared income, including undisclosed income declared during a survey, is accepted by the Assessing Officer.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 133A,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH, PUNE

Before: SHRI INTURI RAMA RAO & SHRI S.S. VISWANETHRA RAVI

For Appellant: Ms. Diksha Agarwal
For Respondent: Shri S.P. Walimbe

आदेश / ORDER

PER S.S. VISWANETHRA RAVI, JM :

1.

This appeal by the assessee against the order dated 07-09-2018 passed by the Commissioner of Income Tax (Appeals)-6, Pune [‘CIT(A)’] for assessment year 2013-14.

2.

The only issue is to be decided is as to whether the CIT(A) justified in confirming the penalty imposed by the AO u/s. 271(1)(c) of the Act in the facts and circumstances of the case.

3.

At the outset, we note that there was a survey u/s. 133A of the Act conducted in the business premises of the assessee on 05-02-2013. During the said survey, the assessee declared income of Rs.1,04,87,640/- as undisclosed income. Thereafter, the assessee filed return of income declaring total income of Rs.1,18,52,080/- and the same was accepted by the AO by completing assessment u/s. 143(3) of the Act. As matter stood thus, the AO initiated penalty proceedings u/s. 271(1)(c) of the Act for escaped income on the ground that the assessee would not have declared Rs.1,18,52,080/- as undisclosed income had no survey taken place. We note that admittedly, the assessee filed return of income declaring total income of Rs.1,18,52,080/- which is inclusive of undisclosed income as declared during the course of survey which was admitted by the respondent-revenue. We find when the respondent-revenue accepted return income, there is no income escaped on which no penalty is leviable. Therefore, the order of CIT(A) is not justified and it is set aside. Thus, the grounds raised by the assessee are allowed.

4.

In the result, the appeal of assessee is allowed.

Order pronounced in the open court on 15th July, 2022.

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