The Tax Publishers2020 TaxPub(DT) 3064 (Jp-Trib) INCOME TAX ACT, 1961
Section 271AAB
Where assessee made undisclosed investment in land, which was not recorded in his books of account and he failed to offer any explanation about the source of the same, the AO was justified in levying penalty under section 271AAB.
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Penalty under section 271AAB - Leviability - Undisclosed investment in land - Addition under section 69B--Assessee failed to offer any explanation about source of undisclosed investment
During course of post search proceedings, assessee admitted an income of Rs. 6,00,000 on account of undisclosed investment in land. Out of admitted undisclosed income of Rs. 6,00,000, the income of Rs. 5,20,000 had been admitted and declared in revised return filed by the assessee. Accordingly, the assessee was asked to furnish justification for not offering balance undisclosed investment of Rs. 80,000. But, no reply was furnished by the assessee, therefore, an addition of Rs. 80,000 under section 69B was made. Subsequently, penalty under section 271AAB was levied. Assessee contended that he had cash in hand of Rs. 80,000 as on 31-3-2013 and the same was utilized in making the investment for purchase of land. Further, he contended that the penalty was levied only in context of income of Rs. 80,000, and not in context of the income of Rs. 5,20,000, accordingly the penalty was liable to be deleted.Held: On perusal of assessment order, it was clearly evident that the penalty had been initiated in respect of Rs. 6,00,000 admitted by assessee pursuant to search. Thus, the contention of the assessee made in that respect was not correct. Further, the assessee also contended that he had cash in hand of Rs. 80,000 as on 31-3-2013 and the same was utilized in making the investment in land. What was required to be seen was the source of investment at the point in time when the investment was made. In the instant case, the sale deed was registered on 5-4-2012, therefore, what was required to be seen was whether the assessee was having sufficient cash in hand on or before 5-4-2012 to make such investment, however, there was nothing on record to substantiate the same. Accordingly, the assessee also failed to justify such contention. Moreover, as the assessee made undisclosed investment in land, which was not recorded in his books of account and he failed to offer any explanation about the source of the same, the AO was justified in levying penalty under section 271AAB.
REFERRED :
FAVOUR : Against the assessee.
A.Y. :
IN THE ITAT, JAIPUR BENCH
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