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No penalty under Explanation-5 to Section 271(1)(c) of the Act could be levied in respect of undisclosed income found in the course ofsearchbut which were duly returned by the assessee in the return filed u/s.153A of the Act together with compliance of other conditions submitted in Clause-2 of Explanation-5 to Section 271(1)(c) of the Act which provides immunity to the assessee from levy of penalty. By this, the penalty levied for all the assessment years in the total sum of Rs. 17,39,035/- is deleted.

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Sec. 271(1)(c) of Income Tax Act, 1961— Penalty — Penalty deserved to be deleted for recording improper satisfaction on the part of the AO by not mentioning the specific offence committed by the assessee in the quantum assessment order and also for initiating penalty on one limb and levying penalty on the other limb of the alleged offence.

Facts: Assessee went on appeal before Tribunal and raised the ground that " whether the ld. CIT(A) was justified in confirming the levy of penalty u/s.271(1)(c) "?

Held, that no penalty under Explanation-5 to Section 271(1)(c) could be levied in respect of undisclosed income found in the course of search but which were duly returned by the assessee in the return filed u/s.153A of together with compliance of other conditions submitted in Clause-2 of Explanation-5 to Section 271(1)(c) which provides immunity to the assessee from levy of penalty. By this, the penalty levied for all the assessment years in the total sum of Rs. 17,39,035/- is deleted and in respect of penalty on additions made during the course of assessments framed u/s.153A for three assessment years i.e. A.Yrs 2001-02, 2003-04 and 2007-08. it was held that the same is deleted for recording improper satisfaction on the part of the AO by not mentioning the specific offence committed by the assessee in the quantum assessment order and also for initiating penalty on one limb and levying penalty on the other limb of the alleged offence. By this, the penalty levied for three assessment years in the sum of Rs. 3,03,339/- is deleted. - JAYANT B PATEL V/s DEPUTY CIT - [2020] 27 ITCD Online 032 (ITAT-MUMBAI)