2021 (6) TMI 808

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....hort the Act). 2. The brief facts are, the assessee filed its return of income on 29.09.2010 for the assessment year 2010-11 declaring total income at Rs. 20,07,780/-. The assessment year was completed u/s 143(3) of the Act, on 18.03.2013 determining the total income at Rs. 1,10,41,140/-. The addition was made on account of bogus purchases amounting to Rs. 90,33,362/-. The assessee preferred an appeal before the Ld. CIT(A)-25, Mumbai and Ld. CIT(A) confirmed the addition on the basis of estimation @ 25% of the bogus purchase for Rs. 22,58,340/-. Subsequently, Assessing Officer initiated penalty proceedings u/s 271(1)(c) of the Act and issued the relevant notices. After considering the submissions of the assessee, Assessing Officer levied t....

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....oth the offences and in some cases there may be overtopping of the two offences but in such cases the initiation of the penalty proceedings also must be for both the offences. But drawing up penalty proceedings for one offence and finding the assesses guilty of another offence or finding him guilty for either the one or the other cannot be sustained in law. The decision in GT vs. Manjunatha Cotton & Ginning Factory (supra) has implicitly been the Supreme Court in the case of CIT vs. SSA's Emerald Meadows [2016] 73 taxmann.com 248 (SC). 13.1 It is to be noted that the Courts have regularly deleted such penalty orders where the AO had proceeded to initiate penalty proceedings on one limb but found the assessee guilty of another limb- ....

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....ction of AO of levying penalty of Rs. 6,97,900/- u/s 271(1)(c) in respect of 25% of addition to the tune of Rs. 22,58,340/- retained by the then CIT(A) in quantum appeal on account of alleged bogus purchases. 2. The Ld. CIT(A) has erred in confirming the action of AO of levying penalty of Rs. 6,97,900/- inspite of the fact that various decisions of High Courts and ITATs in favour of the appellant were kept on record where the penalty of hawala purchases was deleted. 5. On the other hand, the Ld. DR relied on orders passed by lower authorities. 6. Considered the rival submissions and perused the material on record. As it appears, the Assessing Officer imposed penalty under section 271(1)(c) of the Act on ad-hoc basis without adducing any....