DCIT Vs Shreehari Associates Pvt Ltd (ITAT Pune)
ITAT Pune held that penalty under section 271(1)(c)/ 271AAB of the Income Tax Act imposable even in case of voluntary disclosure or declaration or surrender per se of income. Accordingly, appeal filed by revenue allowed.
Facts- The issue in extant bunch of appeals relates to solitary dispute over applicability of penal provisions of section 271(1)(c)/271AAB of the Act, where the income is assessed on the basis of material seized in search & seizure action carried out u/s 132 of the Act and further such addition is buoyed by the declaration on oath u/s 131 of the Act.
Conclusion- Held that the voluntary disclosure or declaration or surrender per se does not discharge the assessee from the mischief of penal proceedings u/s 271(1)(c), as the law does not provide that the assessee be pardoned from penalty when it makes a voluntary disclosure of its unexplained income/expenditure.
Supreme Court in the case of ‘MAK Data Pvt Ltd Vs CIT’ observed that, the explanation to section 271(1) raises a presumption of concealment when income is finally assessed in variation of returned income, and it was in this factual scenario where the income reported by the assessee in the return filed was lower than the income finally assessed and brought to tax, it is held that the penalty was rightly leviable irrespective of the fact whether such variation was on account of voluntary surrender or surrender of income or otherwise.
