TaxTMI 
TaxTMI 
2016 (7) TMI 1343
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....sake of convenience we are deciding the appeals by passing a single order. ITA/695/MUM/2012, AY. 2004-05, Brief Facts: 2. An action u/s. 132 of the Act was carried out on, 25/11/2009 in the case of Mahasagar Securities Private Ltd., along with its group companies. The residential premises of the directors of the company and the auditor of the group companies were also searched. During the course of search it was found that group companies were merely providing accommodation entries in cases involving trading, speculation profit, short-term and long the capital gains or losses, commodity trading, derivative profit or loss, share application money, bogus invoices for purchase and sales etc., that Mukesh Choksy (MC) was controlling all t....
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.... AA. 4. Challenging the penalty order of the AO the assessee referred to the cases of Reliance Petro Products Ltd. (322 ITR 158), Sreenivasa Pai (242 ITR 29) and Durga Timber Works (79 ITR 63) and contended that it had declared 0.15% income from its activities, that the third parties also confirmed the assessee was getting commission of same percent, that the AO had applied rate of 2%, that the Tribunal had reduced the rate to 0.15%,when income was assessed on estimate basis no concealment penalty could be levied, that there was no concrete proof with the AO on the basis of its a reasonable estimate could be applied to determine the taxable income, that it was a case where two views were possible, that the assessee had declared one rate ....
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.... the survey conducted at the business premises of that company, that the incriminating material seized during the course of search and the statements record is from the persons concerned is revealed that the assesses of the group including the assessee and the considerations per charges commission in the range of 1%-3.6%, that though the determination of commission income at the rate of 2% was on estimate but the estimate was based on relevant statement and the incriminating seized documents, that the concealment of particulars income was established, that the assessee had failed to disclose the true and correct commission income in the original return, that the AO were justified in invoking the provisions of section 271(1)(c). Referring to....
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....awala entries-the AO estimated at a particular percentage, whereas the assessee had shown the income at a different percent. The addition made by the AO and confirmed by the FAA in quantum addition may or may not be. But, levying penalty on the basis of an estimated addition could not be held to be justified. No authority is required to be cited that penalty and assessment proceedings are separate and distinct proceedings and the quantum proceedings should not result in automatic levy of concealment penalty. It is a case of estimation of income by the AO and the assessee. Here we would like to discuss two cases. One of them is Aero Traders P. LTD. (322 ITR 316).In that case the assessee-company had filed its return of income for the year....