Penalty u/s 271(1)(c) in search assessment is tenable only if some incriminating material found during search

Brief summary of the case Assessee being partnership firm was engaged in the business of builders & developers. A search u/s 132(1) of the I.T. Act was carried out in case of Shri Shreeram H. Soni on 29-07-2003. During search, blank promissory note and blank undated cheques worth Rs.5 Lacs related to the assessee-firm were found beside some other documents. On the basis of such seized material notice u/s 153C was issued on the assesse-firm. In response, assessee-firm filed its return for A.Y. 1998-99. During the assessment proceedings, A.O asked the confirmation of unsecured loans. The ass...