Case Law Details
When assessee fails to declare the undisclosed income in block return, and the additions made by the AO based on the seized materials are sustained, penalty is warranted in such a case.
Triumph International Finance I Ltd Vs ACIT (ITAT Mumbai)– the undisclosed income determined in the case of the assessee is not as a result of disallowing any claim of the assesse because the same is not allowable as per the provisions of law but undisclosed income has been determined on the basis of the evidences found during the course of search, which has established the fact that the true nature of transactions have not been recorded by the assessee in the books of account and the same has resulted the undisclosed income.
It is not the case where the assessee has claimed any expenditure, nature of income or exemption which has been denied by the tax authorities by applying the provisions of law; but it is a case where some facts were not at all presented by the assessee correctly and truly. Therefore, filing of appeal by the assessee before the jurisdictional High Court and admission of the same would not ipso-facto made out of a case of non levy of penalty. As per the provisions of sec. 158BFA and particularly sub sec.3 the penalty order can be passed within six months from the end of the month in which the order of the Commissioner (Appeal) or the Tribunal is received. Therefore, the authorities can wait up to the order of the CIT(A) or the Tribunal; but there is no such provisions or extension of time for waiting the outcome of the appeal filed before the jurisdictional High Court. Thus, filing of appeal before the jurisdictional High Court does not automatically make out of case in favour of the assessee until and unless the circumstance exists in the case does not warrant penalty at all.
Triumph International Finance I Ltd V. The Asst Commissioner of Income Tax
ITAT Mumbai
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