IN HIGH COURT OF JUDICATURE AT BOMBAY O.O.C.J. INCOME TAX APPEAL NO. 1469 OF 2016 WITH INCOME TAX APPEAL NO. 1467 OF 2016 INCOME TAX APPEAL NO. 1472 OF 2016 INCOME TAX APPEAL NO. 1604 OF 2016 Rahul Shantaram Sawale .. Appellant Versus Asst. Commissioner of Income Tax .. Respondents Central Circle-1, Nashik & Anr. ...... Ms. Alisha Pinto i/by Mihir Naniwadekar for Appellant Mr. Sham Walve for Respondent No. 1 ...... CORAM : AKIL KURESHI & M.S. SANKLECHA, JJ. DATE : FEBRUARY 25, 2019. P.C.: 1. These appeals arise in similar background. They have been heard together and would be disposed of by this common order. 2. Since reference was made to documents in Income Tax Appeal No. 1469 of 2016, same will be treated as lead matter. This appeal is filed by assessee to challenge judgment of Income Tax Appellate Tribunal ('the Tribunal' for short). Learned counsel for appellant assessee 1 of 5 ::: Uploaded on - 27/02/2019 ::: Downloaded on - 28/02/2019 11:58:08 ::: 8. os itxa 1469 1467 1472 1604 16.doc pressed following question for our consideration:- "Whether on facts and in circumstances of case and in law, Tribunal was justified in holding that advances for booking of flats is income for purpose of Explanation 5A of Section 271(1)(c) of Income Tax Act, 1961 ("the Act" for short) and levying penalty for same?" 3. Appellant assessee is engaged in business of real estate development. assessee's premises were subjected to search and seizure operation. Statements of responsible persons were recorded leading to issuance of notice under Section 153A of Income Tax Act, 1961 by Assessing Officer. assessee filed return of income in which additional income was disclosed but it was stated that such additional income was disclosed to buy peace and on condition that no penalty proceedings would be initiated. Assessing Officer framed assessment pursuant to assessee's return under Section 153A of Act and made suitable additions. He also instituted penalty proceedings and imposed penalty under Section 271 (1)(c) of Act read with explanation 5A. assessee challenged penalty order before Commissioner (Appeals). Though several grounds were raised in appeal memo, at time of arguments, assessee pressed only one 2 of 5 ::: Uploaded on - 27/02/2019 ::: Downloaded on - 28/02/2019 11:58:08 ::: 8. os itxa 1469 1467 1472 1604 16.doc ground namely, "On facts and in law Assessing Officer has erred in levying penalty of Rs. 15,08,250/- under Section 271(1)(c) of Act", before Commissioner (Appeals). 4. Commissioner (Appeals) allowed appeal principally on ground that disclosure of additional income related to advances received by assessee from prospective buyers. He accepted assessee's contention that such advance did not form part of assessee's income. Revenue carried matter in appeal. Tribunal reversed order of Commissioner upon which assessee has filed this appeal. 5. Having heard learned counsel for parties, we do not find any error in view of Tribunal. order of assessment under Section 153A of Act has become final. assessee has not questioned additions further. It is true that penalty proceedings are independent of assessment proceedings. Nevertheless, assessee cannot merely raise contention that advance receipt was really 3 of 5 ::: Uploaded on - 27/02/2019 ::: Downloaded on - 28/02/2019 11:58:08 ::: 8. os itxa 1469 1467 1472 1604 16.doc not in nature of income and therefore, no penalty could be levied. In appeal before Commissioner, assessee had not taken any such elaborate ground. 6. We have perused appeal memo of appeal before Commissioner which nowhere explains assessee's stand that amount in question did not represent income or reasons for same. Further, as noted, assessee confined appeal to single ground namely that Assessing Officer had committed error in leaving penalty. We also notice that main thrust of assessee's contention in appeal was that disclosures were made to buy peace and on condition that penalty proceedings would not be instituted. Both grounds not found favour with Supreme Court in case of MAK DATA P Ltd Vs. CIT 1. We also notice that assessee has not built up any case for arguing that receipt in question was not in nature of income. Merely by stating so and relying on judgment of this Court in case of CIT, Nagpur Vs. Karda Constructions Pvt Ltd2, 1 (2013) 358 ITR 593 (SC) 2 Income Tax Appeal (L) No. 1960 of 2012 decided on 25.2.2013 4 of 5 ::: Uploaded on - 27/02/2019 ::: Downloaded on - 28/02/2019 11:58:08 ::: 8. os itxa 1469 1467 1472 1604 16.doc assessee cannot hope to establish same. assessee had made disclosure of additional income. To dislodge his own declaration that disclosures did not relate to income assessee had to lay down foundation which in present case is totally missing. Section 271(1) of Act as is well known refers to penalty that may be imposed on assessee under specified circumstances. Explanation 5A added to said sub-section by Finance Act 2009 w.e.f. 1.6.2007 covers situation where assessee post search files return of income disclosing additional income claiming immunity from penalty. explanation provides that notwithstanding declaration of such income in return filed after date of search, same would be deemed to be case of concealing particulars of income or case of furnishing of inaccurate particulars of income. case of assessee would squarely fall within this explanation and Tribunal correctly reinstated order of Assessing Officer. In result, no question of law arises. All Income Tax appeals are dismissed. [ M.S. SANKLECHA, J. ] [ AKIL KURESHI, J ] 5 of 5 ::: Uploaded on - 27/02/2019 ::: Downloaded on - 28/02/2019 11:58:08 ::: Rahul Shantaram Sawale v. Asst. Commissioner of Income-tax Central Circle-1, Nashik & Anr