AIROnline 2025 SC 73

(A) Income-Tax Act (43 of 1961) , S.271AAA(1)— Undisclosed income – Penalty in case of search – Discretion of assessing officer – Penalty u/S. 271AAA(1) may be levied if there is undisclosed income in specified previous year – Imposition of penalty is not mandatory but discretionary – Discretion to be exercised by assessing officer must be sound discretion guided by law and must not be arbitrary.
AIR 1990 SC 1176-Relied on

(Para 31)

(B) Income-Tax Act (43 of 1961) , S.271AAA(2)— Undisclosed income – Penalty in case of search – When not leviable – S 271AAA(1) of Income Tax Act is not applicable where assessee, in a statement u/S. 132 (4) in the course of the search, admits the undisclosed income and specifies the manner in which such income has been derived; substantiates the manner in which the undisclosed income was derived; and pays the tax, together with interest, if any, in respect of the undisclosed income.

(Para 32
33)

(C) Income-Tax Act (43 of 1961) , S.271AAA— Undisclosed income – Penalty in case of search – Assessee admitted before DDIT during search , c….