Case Law Details
ACIT Vs. M/s. Sree Shanmugam Modern Rice Mills Pvt. Ltd. (ITAT Bangalore)
Admittedly in this case, the assessee had disclosed the concealed income while giving the statement u/s 132(4) of the Act in the course of search. The assessee also duly paid the taxes and interest thereon. The CIT(A) while allowing the appeal of the assessee had held that the money belonged to the group concern and some friends living near the factory, who had entrusted the same to the Managing Director of the assessee- company. Since the Managing Director was unable to explain / prove it, the same was offered to taxation. The CIT(A) has held that the Assessing Officer was unable to prove the explanation offered by the assessee as wrong. The finding of the CIT(A) reads as follow:-
“The appellant has stated that the money was belonging to the group concern and some friends living near the factory who were keeping with Mr. R.N. Shanmugham and he offered as undisclosed income as he found that it will be difficult for him to prove it. The explanation of the appellant has not been found to be wrong by the Assessing Officer. No evidence has been found which will suggest that the appellant was earning undisclosed income in the form of some unaccounted transactions recorded outside the books. The appellant has admitted in his sworn statement about this undisclosed income, has filed the return of income showing the same as his income & has paid the necessary taxes on this. From the case laws mentioned above, it is clear that on similar facts of the case, penalty u/s 271AAA has been cancelled. Therefore, humbly following the case laws as cited supra, the penalty u/s 271AAA is cancelled.”
The above finding of the CIT(A) has not been dispelled by the Revenue by placing any contradictory material before us. Hence, we uphold the order of the CIT(A) as correct and in accordance with law. It is ordered accordingly.
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