TaxTMI 
TaxTMI 
2009 (11) TMI 639
X X X X Extracts X X X X
X X X X Extracts X X X X
....of law : "Whether, on the facts and circumstances of the case, the Tribunal was right in holding that no penalty for concealment is leviable under section 271(1)(c) if the assessment is based on estimate basis ?" 2. The facts, which are common in all these cases, are as follows : 3. The appeal filed against I. T. A. No. 1364/Mds/2008 relating to the assessment year 1992-93 has been taken as typical case of narration of facts. (i) The assessee is engaged in the business of manufacture and sale of solvent ether and anesthetic ether. The assessee filed its return of income for the assessment year 1990-91 on September 27, 1991, declaring a loss of Rs. 24,34,390. The income was determined at Rs. 1,34,74,38....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... section 271(1)(c) of the Income-tax Act, 1961. Aggrieved by that order, the Revenue filed further appeal before the Income-tax Appellate Tribunal. Thus, the Tribunal relying on the decision of this court in the case of CIT v. Smt. K. Meenakshi Kutty reported in [2002] 258 ITR 494, wherein it was held that no penalty for concealment can be levied if the assessment is based on estimate and there is no gross or willful negligence on the part of the assessee, the Appellate Tribunal upheld the order of the Commissioner of Income-tax (Appeals). The order so made by the Tribunal iscanvassed before this court by filing these appeals. 4. We have heard the argument of Mr. J. Narayanasamy, learned standingcounsel appearing for the Revenue. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....lating to earlier years and directed the Assessing Officer to adopt the profit of Re. 1 per litre of the rectified spirit. While doing so, the Tribunal has also taken into consideration the observation made by the Assessing Officer himself in the assessment order in respect of the assessment year 1988-89, which reads as under : "Going by the peculiar set of circumstances prevalent in this case and considering that the assessment has gone back and forth to the various authorities without any benefit to the Revenue by way of taxes or to the assessee in the form of ending a protracted litigation, it appears to me that in the fitness of things and in the absence of any clinching materials to decide the issue otherwise, I am inclined t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....or furnishing inaccurate particulars of such income, invocation of the penal provision under section 271 of the Income-tax Act, 1961, is not correct. The Assessing Officer has completed the assessment as per the direction of the appellate authority by adopting 1 per cent. of profit, which is not based on any material, but on the basis of concession. 7. In respect of analogous factual position of a case, decided by a Division Bench of this court, in the case of CIT v. Smt. K. Meenakshi Kutty reported in [2002] 258 ITR 494, would be of useful. In the above said decision, it is held that it is not as if the Tribunal has held in all cases, where estimation has been made, the penal provision cannot be invoked, but in the given set of f....