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Tribunal Reverses Rs. 1,17,271 Penalty u/s 271(1)(c) for AY 2012-13 Due to Lack of Evidence. The Tribunal allowed the Assessee's appeal against the penalty order under Section 271(1)(c) of the Income Tax Act, 1961, for AY 2012-13. The penalty, ...
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Tribunal Reverses Rs. 1,17,271 Penalty u/s 271(1)(c) for AY 2012-13 Due to Lack of Evidence.
The Tribunal allowed the Assessee's appeal against the penalty order under Section 271(1)(c) of the Income Tax Act, 1961, for AY 2012-13. The penalty, based on estimated additions for bogus purchases, was deemed unsustainable as it lacked sufficient evidence. The Tribunal found no concealment or furnishing of inaccurate particulars of income, noting the purchases were opening balances not related to the relevant year. Consequently, the Tribunal set aside the CIT(A)'s order and directed the reversal of the Rs. 1,17,271 penalty imposed by the Assessing Officer.
Issues involved: The appeal against the penalty order under Section 271(1)(c) of the Income Tax Act, 1961 concerning AY 2012-13 based on estimated additions towards bogus purchases.
Summary: The appeal was filed by the Assessee against the penalty order imposed by the Assessing Officer for alleged concealment of income due to estimated additions towards bogus purchases. The Assessee claimed to have submitted documentary evidence during re-assessment proceedings to support the purchases, but the Assessing Officer estimated 12% of the purchases as unexplained, leading to a penalty of Rs. 1,17,271. The first appeal to the CIT(A) did not provide any relief, resulting in the current appeal.
Upon careful consideration, the Tribunal noted that for penalty under Section 271(1)(c) to be imposed, there must be concealment or furnishing of inaccurate particulars of income. In this case, the disallowance was made on an estimated basis without sufficient evidence to support the purchases. The Assessee argued that the purchases did not pertain to the relevant Assessment Year and were actually opening balances, rendering the penalty unsustainable. Citing relevant case law, the Tribunal found the penalty to be unjustified and unsustainable in law.
In light of the above, the Tribunal set aside the CIT(A)'s order and directed the Assessing Officer to reverse the penalty imposed. Consequently, the appeal of the Assessee was allowed.
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