Search under sec 132 of IT if found any company related document any persons possession and whose name stated as MD if not disclosed than penalty can be imposed on him

IN THE INCOME TAX APPELLATE TRIBUNAL

“ A ” BENCH, AHMEDABAD

BEFORE SHRI MUKUL Kr.SHRAWAT, JUDICIAL MEMBER AND

SHRI B.P.JAIN, ACCOUNTANT MEMBER

Revenue by : Shri Abhishek Kumar, Sr.D.R.

Assessee by : Shri V.R.Choksi, A.R.

Date of Hearing : 27/12/2011

Date of Pronouncement : 27/12/2011

O R D E R

PER BENCH:

Six appeals have been filed by the Revenue and six Cross Objections have been filed by the respondent-assessee arising from a common order of ld.CIT(A)-Gandhinagar dated 30/11/2009 passed for AYs 1999-2000 to 2004-05.

2. Revenue’s ground reads as under:-

1. The Ld. CIT(A) was not justified in deleting the penalty of Rs.7,02,856/- for A.Y. 1999-2000, Rs.3,53,028/- for A.Y. 2000-01, Rs.5,74,236/- for A.Y. 2001-02, Rs.7,16,346/- for A.Y. 2002-03, Rs.5,85,906/- for A.Y. 2003-04 and Rs.6,13,800/- for A.Y. 2004-05. 271(1)(c) of the I.T. Act.

2.1. A search was carried out u/s.132(2) of the I.T.Act, 1961 on 20/08/2004 in Vimal Group of cases and thereupon these assessments were made u/s.153A(b) of the I.T.Act. During the course of search, a data file of “ACME Company” was found and seized from the premises of the assessee. The assessee is stated to be M.D. of Vimal Group. The assessee had attempted to deny that the transaction noted in ACME Data file belonged to him. However, on the other hand, Revenue has attempted to establish the nexus between the data in the said ACME file with the assessee. The first appellate authority has given some relief pertaining to the percentage of the Net Profit. Against that relief, Revenue had gone in appeal and Respected Co-ordinate Bench “A” ITAT Ahmedabad in a consolidated order bearing ITA Nos.2151 to 2156/Ahd/2007 for A.Ys. 1999-2000 to 2004-05 respectively titled as Jayesh Chandubhai Patel vs. Dy.CIT and ITA Nos.2494 to 2499/Ahd/2007 for A.Ys. 1999-2000 to 2004-05 respectively tiled as Dy.CIT vs. Jayesh Chandubhai Patel, dated 14/05/2010 has restored the issue back to the file of the Assessing Officer with the following directions:-

“18. As a result, we give following directions to the AO-

(1) He will provide copies of data of ACME file to the assessee and ask him to match each entry with the regular books of any of the group company;

(2) If the entry found recorded in ACME file tallies with or matches with any entry of the regular books of the group company then that entry will be excluded. Other entries in ACME file not matching with the regular books of any other group company will be compiled and totaled.

(3) A net profit rate of 5% would be applied on such total of the entries on the receipt side found not matching with any regular books of any group company. This amount will be treated as undisclosed income of the assessee.

19. As a result appeal filed by the assessee and that of Revenue are allowed for statistical purposes.”

3. With this brief factual background, we have heard both the sides. Parties appearing before us have fairly expressed that since the issue pertaining to the quantum addition had already been restored back to the file of the Assessing Officer with certain directions for de novo adjudication, therefore consequence thereupon these penalty proceeding deserves to be restored back to the file of the Assessing Officer. Considering the totality of the facts of the case, we deem fit to restore the issue of levy of penalty u/s.271(1)(c) of the I.T.Act for afresh adjudication by the Assessing Officer in the light of the outcome of the assessment proceedings. We direct accordingly. The grounds of the Revenue for all the years may therefore be treated as allowed but for statistical purposes.

4. From the side of the Cross Objector, Ld.AR Mr.V.R. Choksi fairly expressed not to press the cross objections since the matter is otherwise going back for adjudication. In the light of the concession expressed by the ld.AR Mr.V.R.Choksi, these cross objections are hereby dismissed

being withdrawn.

5. In the result all the appeals of the Revenue may be treated as allowed only for statistical purposes and the cross objections filed by the Assessee are dismissed.

This Order is pronounced in open Court on 27/ 12 /2011

                                        Sd/-                                                 Sd/-

                                  (B.P. JAIN)                       (MUKUL Kr. SHRAWAT)

                         ACCOUNTANT MEMBER       JUDICIAL MEMBER

T.C. NAIR, Sr. PS

Copy of the Order forwarded to :

1. The Appellant

2. The Respondent.

3. Concerned CIT

4. The CIT(A)-Gandhinagar

5. DR, ITAT, Ahmedabad

6. Guard file.

//True Copy//

 BY ORDER,

(Dy./Asstt.Registrar)

ITAT, Ahmedabad