Spaze Towers (P) Ltd. v. Dy. CIT

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The Tax Publishers2019 TaxPub(DT) 0228 (Del-Trib) : (2018) 196 TTJ 0955

INCOME TAX ACT, 1961

Section 271(1)(c), Expln. 5A

Since due date of filing return of income for the relevant previous year had expired and assessee had not filed return. Also, in the return of income filed in response to notice under section 153A the subject income had not been declared. Since the previous year corresponding to assessment year in consideration has ended before the date of search and addition had been made on the basis of entry found in seized documents, accordingly, assessee's case squarely fell under deeming provisions of Explanation 5A below section 271(1)(c) and levy of penalty was justified.

Penalty under section 271(1)(c) - Concealment or furnishing of inaccurate particulars - Undisclosed income admitted during search - Applicability of Expln. 5A to section 271(1)(c)

During the course of search (conducted on 29-4-2008), assessee had surrendered undisclosed income.The assessee had not filed regular return of income for the year under consideration as per section 139. Also, assessee filed 'nil' return in pursuance of notice issued under section 153A. AO made addition of said income in assessment completed under section 153A and also levied penalty invoking Expln. 5A below section 271(1)(c). Assessee contended that subject income represented the income for assessment year 2008-09.Held: Clearly due date of filing return of income for the relevant previous year had expired and assessee had not filed return. Also, in the return of income filed in response to notice under section 153A also the subject income had not been declared. Since the previous year corresponding to assessment year in consideration has ended before the date of search and addition had been made on the basis of entry found in seized documents assessee's case squarely fell under deeming provisions of Expln. 5A below section 271(1)(c). Further, conduct of the assessee in not objecting to addition of income in the assessment year under consideration showed that the claim of income relevant to the year under consideration had been accepted by assessee. Accordingly, levy of penalty was justified.

REFERRED : Sanjay Aggarwal v. CIT (2012) 15 Taxmann.com 34 (P&H-HC) : (2012) 211 Taxman 178 (P&H-HC)(Mag.), CIT v. Prasanna Dugar (2015) 279 CTR (Cal-HC) 86 : 2015 TaxPub(DT) 0662 (Cal-HC) : (2015) 59 Taxmann.com 99 (Cal), Asstt. CIT v. Smt. J. Mythili 35 taxmann.com 86 (Chen)(Trih), Smt. Kirdn Devi v. Asstt. CIT (2009) 125 TTJ (Del-HC) 631 : 2009 TaxPub(DT) 1969 (Del-Trib), CIT v. S.J. Prasad (2008) 220 CTR (Ker-HC) 169 : 2008 TaxPub(DT) 1740 (Ker-HC), CIT v. Smt. Meera Devi (2012) 253 CTR (Del-HC) 559 : 2012 TaxPub(DT) 3076 (Del-HC) and Shourva Towers (P) Ltd. v. Dy. CIT (2013) 359 ITR 523 (Del-HC) : 2013 TaxPub(DT) 0470 (Del-HC).