Penal Provisions on Undisclosed Income found during the Course of Search

Penal Provisions on Concealed Income discovered during the Course of Search, Inspect Total Details or Rules of Penalty Arrangement on Undisclosed Income discovered during the Course of Browse. In this post you can discover complete details for Penal Provisions on Undisclosed Earnings found throughout the Course of Search like– Mraning of Undisclosed income, for the purpose of this area, Arrangement for No penalty under section 271( 1 )( c) is leviable in respect of such undisclosed income etc. Inspect More details for Penal Arrangements on Concealed Income from listed below …

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Penal Arrangements on Concealed Income

In regard of searches started in between 1.6.2007 and 30.6.2012, penalty was leviable @10% of concealed income under area 271 AAA, if the undisclosed earnings related to–

  • the previous year which had actually ended before the date of search, however the due date of filing return had not expired before the date of search and the return had not been provided; or,
  • the previous year in which search was

Nevertheless, no charge was leviable if the assessee confessed the concealed income in a statement under area 132( 4) taped in the course of search and specified the manner in which such income had actually been earned and paid the tax together with interest, if any, in regard of such earnings.

Consequently, concealed income discovered throughout the course of search attracted no charge if such concealed earnings was admitted in the course of search and charge @10%, if such concealed income was not confessed in the course of search.

In order to hinder the practice of hiding earnings, the penal arrangements have actually been made more rigid by insertion of area 271 AAB which provides for levy of penalty on concealed income found throughout the course of a search, which has actually been initiated on or after 1st July, 2012, which relates to specified previous year, i.e.-

  • the previous year which has ended before the date of search, but the due date of filing return of income for the very same has not expired before the date of search and the return has actually not yet been provided;-LRB-
  • the previous year in which search is

Appropriately, under area 271 AAB, charge @10% would be drawn in, if concealed earnings is admitted throughout the course of search in the statement furnished under area 132( 4 ), and the assessee describes the way in which such earnings was obtained, pays the tax, together with interest if any, in regard of the concealed earnings, on or prior to the specified date (i.e., the due date of filing return of earnings or the date on which the period defined in the notice provided under section 153 An expires, as the case might be) and provides the return of earnings for the specified previous year declaring such concealed earnings.

If concealed income relating to the specified previous year is not confessed during the course of search in the declaration provided under section 132( 4) but the very same is disclosed in the return of earnings filed after the date of search and the tax in addition to the interest, if any, is paid prior to the defined date, then, the taxpayer will be responsible for penalty @20% of undisclosed income.

In all other cases, charge ranging from 30% to 90% of undisclosed earnings would be drawn in.

Concealed income, for the function of this section, indicates:

any earnings of the specified previous year represented, either wholly or partially, by any cash, bullion, jewellery or other valuable short article or thing or any entry in the books of account or other files or deals found in the course of a search under section 132, which has-

  • not been recorded on or before the date of search in the books of account or other files maintained in the regular course connecting to such previous year; or
  • otherwise not been disclosed to the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner prior to the date of search; or

any earnings of the specified previous year represented, either entirely or partially, by any entry in respect of a cost recorded in the books of account or other files preserved in the typical course associating with the specified previous year which is found to be false and would not have been discovered to be so had the search not been carried out.

No charge under area 271( 1 )( c) is leviable in respect of such undisclosed earnings.

An order imposing charge under area 271 AAB would be appealable under section 246 A before the Commissioner (Appeals). Section 274 attending to the treatment for imposing penalties and area 275 attending to a bar of restriction for imposing charges, shall, to the degree pertinent apply to charge under section 271 AAB.

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