TaxTMI 
TaxTMI 
2019 (10) TMI 625
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....esented on behalf of the Assessee, and Mr.Salendra Mammidi represented on behalf of the Revenue. 3. Since the issue arising out of penalty levied u/s.271A r.w.s 274 of the Act is common in all these appeals, we heard these appeals together and dispose of the same by this common order. 4. The assessee has filed concise grounds of appeal as follows:- "1. Assessment Order passed by the AO is without jurisdiction for the following reasons: (a) The Assessment Orders were passed by the AO in respect of AYs 2009-10, 2010-11, 2011-12, 2013-14 and 2014-15 without prior approval of Joint Commissioner of Income Tax (JCIT) as per Sec. 153D of the Act. The approval dated 27.12.2016 in respect of AYs 2012-13 and 2015-16 u/s 153D(p....
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....ction 271A rws 274 of the Act, the following were observed while allowing the appeals of the Appellant by dropping penalty proceedings for AYs 2009-10 to 2015-16: (a) Assessee was maintaining books of accounts and also kept vouchers for expenditures. (b) No specific books of accounts have been prescribed for business of a civil contractor and thus rigor of penalty u/s 271A is not applicable. (c) Reference was made to sub section (2) of Sec. 44AA of the Act, to indicate that the appellant had maintained books of accounts and other documents that could have enabled AO to compute Assessee's total income in accordance with the Act. 5. The Revenue Department was aware about the income declared by the Asses....
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....ng to expenditure, etc., to his Auditor. The assessee had categorically mentioned that he was not aware of the cash book, bank book, individual ledger accounts for expenses, trial balance, etc. It was submitted that Auditor had also been called and statements recorded u/s.131 of the Act. The Auditor had appeared and had stated that he was not in possession of any of the books of account except tally back up accounts based on the data provided by the assessee. It was submitted that on account of non-maintenance of books of accounts, penalty proceedings u/s.271A of the Act has also been levied on the assessee. It was a further submission that against the levy of penalty u/s.271A of the Act, the assessee had filed an appeal before the ld.CIT(A....
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....rejection of assessee"s books, and estimation of the income of assessee was not permissible. It was submitted that estimation as done by the Assessing Officer and as reduced by the ld.CIT(A) at 7%, was liable to be deleted and returned income accepted. 6. In reply, the ld.DR vehemently supported the orders of the Assessing Officer and the ld.CIT(A). It was submitted that in course of search on the assessee, incriminating materials have been found and as the assessee was unable to substantiate the expenditure claimed, the Assessing Officer had rejected the assessee"s books of accounts maintained on tally back up accounts by the Auditor. It was submitted that the assessee was also not maintaining any books from which the true and correct i....
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.... read with Rule 6F(1) of Income Tax Rules, 1962. A perusal of pra 5.4 of ld.CIT(A)"s order cancelling the penalty levied u/s.271A of the Act shows that: "The Appellant's explanation that the profits could be worked out by preparing "income and expenditure statement", is plausible. In fact, the Assessing Officer could disallow such expenditures ig he comes to a conclusion that they are not substantiated or are not incurred wholly and exclusively for the purpose of the Appellant's business. In fact, I have in the quantum appeals vide order in ITA Nos.279 to 285/18-19 dated 09.01.2019. I have given partial relief to the Appellant by holding that 7% of the turnover as income from contract business would meet the ends of justice." Ld....