https://www.taxtmi.com/caselaws?id=769707 The ITAT Surat allowed the assessee's appeal and directed deletion of penalty levied under section 271(1)(c). The tribunal held that penalty cannot be imposed where income addition is made on estimation basis, particularly in cases involving alleged bogus purchases. Following precedents from Gujarat HC and Rajasthan HC, along with coordinate bench decisions, the tribunal ruled that when purchases were treated as bogus by the AO based on Investigation Wing findings, but payments were made through account payee cheques with corresponding sales, applying ad hoc gross profit rates on alleged bogus purchases cannot justify penalty for furnishing inaccurate particulars or concealing income details. en-us Mon, 28 Apr 2025 00:00:00 +0530 Wed, 30 Apr 2025 08:38:14 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=769707 The ITAT Surat allowed the assessee's appeal and directed deletion of penalty levied under section 271(1)(c). The tribunal held that penalty cannot be imposed where income addition is made on estimation basis, particularly in cases involving alleged bogus purchases. Following precedents from Gujarat HC and Rajasthan HC, along with coordinate bench decisions, the tribunal ruled that when purchases were treated as bogus by the AO based on Investigation Wing findings, but payments were made through account payee cheques with corresponding sales, applying ad hoc gross profit rates on alleged bogus purchases cannot justify penalty for furnishing inaccurate particulars or concealing income details. Case-Laws Income Tax Mon, 28 Apr 2025 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=769707