TaxTMI 
TaxTMI 
2018 (5) TMI 1985
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....d in the business of electronics items in the name and style of M/s Krishna Electronics and M/s Jharkhand Electric & Electronics. In respect of M/s Krishna Electronics, the assessee has received commission income from M/s Samsung India Ltd. for supply of CDS items and in M/s Jharkhand Electric & Electronics, the assessee carries out trading of electronic items for the local market. During the course of assessment proceedings, the assessee filed trading and profit and loss account of M/s Jharkhand Electric & Electronics showing net profit of Rs. 3,75,344/- on the total sales of Rs. 91,36,106/- showing the NP rate @ 4.11%. During the course of assessment proceedings, the assessed was asked to produce bills vouchers and bank account of his undisclosed business carried out in the name and style of M/s Jharkhand Electric & Electronics, which has not been disclosed in the return of income. It was also found that the cash deposits in the bank account are related to the said business being carried out by the assessee. As against the turnover of Rs. 91,36,106/-, the Assessing Officer worked out the turnover of Rs. 96,10,000/- and estimated the NP rate at 5% against 4.11% declared by the ass....
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....f income at Rs. 2,45,630/-. The addition which was made on account of Jharkhand Electric & Electronics due to cash deposited of Rs. 1,13,10,000/- in the bank account maintained with Bank of Maharashtra during the year under consideration. The income which was earned on the basis of cash deposited in the bank account was Rs. 3,75,344/- on estimate basis because no regular books of accounts were maintained by the assessee for Jharkhand Electric & Electronics and the profit so estimated. Since that there was a bonafide mistake by the assessee not to disclose the income from Jharkhand Electric & Electronics. Under the circumstances, there is no part of income concealed or under stated and further the 1,05,256/- was added in estimated income on the basis of sales estimated on the basis of bank account @ 5%. That as regard penalty u/s 271(1)(c), it has been held that in the matter of Dilip N Shroff Vs Jt. CIT (2007) 210 CTR (SC) 228 (2007) 291 ITR 519 SC by the Honorable Supreme Court that levy of penalty u/s 271(1) (c) of the IT Act, 1961 is not automatic and is a matter of discretion and the AO has to be fair and objective. It has been held in a recent judgement by the Honorable Supre....
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....nd delete the penalty u/s 271(l)(c) of the IT Act, 1961 amounting to Rs. 73,022/-. 7. Per contra, the ld DR has submitted that it is a clear case of concealment of income as during the course of assessment proceedings, on pointed out by the AO, the assessee has come forward and disclosed the nature of cash deposit in her bank account which represents the business receipts arising out of business transactions pertaining to M/s Jharkhand Electric & Electronics. It was submitted that had the case of the assessee not picked up for scrutiny, the said income would have escaped taxation. Further, it was submitted that it is not a case of mere estimate of turnover and GP rate by the Assessing officer and thus the decisions relied upon by the ld AR are distinguishable. Further, she has relied on the orders of the lower authorities. 8. We have heard the rival contentions of both the parties and perused the material available on the record. The case of the assessee was selected for scrutiny assessment to examine the source of cash deposit of Rs. 1.13 crores in the bank account maintained by the assessee. During the course of assessment proceedings, the assessee submitted that the cash depos....
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.... We have heard the rival contentions of both the parties and perused the material available on the record. Undisputedly, the total receipt/turnover of the assessee business from both M/s Krishna Electronics and M/s Jharkhand Electric & Electronics, amounts to Rs. 1,02,68,170/- and as the assessee was having turnover exceeding Rs. 60 lacs during the year under consideration, the provisions of Section 44AA of the Act are clearly applicable and the assessee was liable to maintain her books of account. Nothing has been brought on record which demonstrates any reasonable cause on part of the assessee in non- maintenance of her books of accounts. Therefore, we confirm the action of the AO in levying penalty under section 271A and the ground of appeal is hereby dismissed. 12. Now, coming to levy of penalty U/s 271B of the Act for not getting the books of account audited. The Assessing Officer observed that since the turnover of the assessee's business exceeds Rs. 60 lacs, the provisions of Section 44AB of the Act are clearly applicable and the assessee has failed to get her books of account audited. Accordingly, penalt....