TaxTMI 
TaxTMI 
TaxTMI 
2020 (5) TMI 83
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....without appreciating the fact that the levy of penalty on estimated addition on account of bogus purchases doesn't alter the fact of furnishing inaccurate particulars of income relating to purchases resulting into concealment of income. 3. The appellant craves leave to add, amend, alter or delete any ground of appeal. 4. The order of the CIT(A) may be vacated and that of the assessing officer may be restored." 3. Inspite of issue of notice, none appeared on behalf of the assessee nor any adjournment was sought. Thus, we proceed to dispose of this appeal based on the facts on record and hearing the Ld. DR on merits. 4. Briefly stated the facts are that, assessee filed his return of income on 25.09.2009 declaring total income of Rs..3,38,530 for the A.Y. 2009-10. The assessment was completed u/s. 143(3) r.w.s. 147 of the Act on 05.03.2015. While completing the assessment on the basis of the information received from Sales Tax Department, Mumbai the Assessing Officer noticed that the assessee has obtained accommodation entries from various parties without making any purchases from them but made purchases only in gray market. The Assessing Officer treated such purchases from....
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.... purchases at 12.5% and by reducing the Gross Profit already declared by the assessee. In the circumstances, we hold that there is no concealment of income or furnishing of inaccurate particulars as the profit element was determined by way of adhoc estimation. Coming to the interest, the assessee furnished complete details in the return of income and made a claim and simply because the claim is denied and cannot lead to furnishing of inaccurate particulars or concealment of income. No allegation by Assessing Officer that the assessee failed to disclose the particulars relating to its claim in the return of income. Thus we hold that there is no concealment of income or furnishing of inaccurate particulars of income. Thus we direct the Assessing Officer to delete the penalty levied u/s. 271(1)(c) of the Act." 8. Similarly, in the case of DCIT v. Manohar Manak, Alloys Pvt. Ltd in ITA No. 5586/MUM/2015 dated 16.01.2017 the Coordinate Bench held as under: - "9. We have heard the rival parties and carefully considered material placed before us including the order of the authorities below. We find from the assessment order that the AO has made an addition of Rs. 45,76,587/- being 5....
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....14 (AY-2010-11) dated 28.11.2014; b) DCIT V/s Shri Rajeev G Kalathil in ITA No.6727/Mum/2012 (AY-2009-10) dated 20.8.2014; and c) Shri Ganpatraj A Sanghavi V/s ACIT in ITA No. 2826/Mum/2013 (AY-2009-10) dated 5.11.2014 In all the above said cases, the Co-ordinate Benches of the Tribunal has held that the AO was not justified in making the addition on the basis of statements given by the third parties before the Sales Tax Department, without conducting any other investigation. In the instant case also, the assessing officer has made the impugned addition on the basis of statements given by the parties before the Sales tax department. We notice that the ld.CIT(A) has taken note of the fact that no sales could be effected without purchases. He has further placed reliance on the decision rendered by Hon'ble Gujarat High Court in the case of CIT Vs. M.K. Brothers (163 ITR 249). He has further relied upon the decision rendered by the Tribunal in the case of ITO Vs. Premanand (2008)(25 SOT 11)(Jodh), wherein it has been held that where the AO has made addition merely on the basis of observations made by the Sales tax dept and has not conducted any independent enquiries for making th....
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.... Tribunal reduced the addition to Rs. 1,50,000. Hence, the income was finally assessed at Rs. 1,50,000 against the declared income of Rs. 52,000. The Assessing Officer initiated penalty proceedings against the assessee by invoking Section 271(1)(c) along with the Explanation 1(B) of the Act on the plea that he had concealed the particulars of his income. A show-cause notice was issued to him under Section 274 read with Section 271(l)'(c) of the Act. In reply thereto, the assessee pleaded that since no positive concealment had been detected by the Department and the addition was made in his income only on estimate basis, no penalty under Section 271(1)(c) of the Act could be imposed because the assessee's income on estimate basis keeping in view his household expenses as well as the statement of accretion to his assets during the year under consideration, was bona fide. The Assessing Officer did not accept the reply and found that since the assessee had not filed any fresh evidence in penalty proceedings to prove that there was no attempt on his part to conceal his income, he, by his order dated March 10, 1992, imposed a penalty of Rs. 50,000. Feeling aggrieved by this order....