2021 (8) TMI 921

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.... As common issues are involved in the aforementioned appeals, therefore the same are being taken up and dispossed off by way of a consolidated order. We shall first take up the appeal for A.Y. 2009-10 The revenue has assailed the impugned order on the following grounds before us: "1. On the facts and in the circumstances of the case, the Ld. CIT(A) erred in deleting the penalty levied by the AO u/s 271(1)(c) of the Income Tax Act, 1961, of Rs. 7,58,217/- witho appreciating the facts that the assessee has failed to substantiate the transactions claimed : its return of income thereby evaded taxes to that extent. 2. On the facts and circumstances of the case and in the law, the Ld. CIT(A) erred is not appreciating the fact th....

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....e basis of information received by the A.O that the assessee as a beneficiary had obtained certain bogus purchase bills aggregating to Rs. 1,74,43,835/-, his case was reopened u/s 147 of the Act. 3. During the course of the assessment proceedings, it was observed by the A.O that the assessee had claimed to have made purchases aggregating to Rs. 1,74,43,835/- from 16 tainted parties. As the assessee failed to substantiate the genuineness and veracity of the aforesaid purchase transactions, therefore, the A.O holding a conviction that the purchases were made by the assessee not from the aforementioned hawala parties, but at a discounted value from the open/grey market, thus, disallowd 12.5% of the impugned purchases of Rs. 1,75,19,573/- an....

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....in CBDT Circular No .12/2019, dated 08.08.2019 r.w. circular No. 3/2018, dated 11.07.2018 (as amended on 20.08.2018), however, as the case falls within the realm of the exception provided in Para 10(e) of the aforesaid circular, therefore, the present appeal was maintainable: 7. We have heard the ld. authorized representatives for both the parties, perused the orders of the lower authorities and the material available on record, as well as considered the CBDT Circulars as had been relied upon by them to drive home their respective contentions. Admittedly, the assessee had been saddled with an addition/disallowance of the impugned bogus purchases of Rs. 21,89,946/- w.r.t the impugned purchases which were claimed by it to have been made fr....

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.............................................................................. (e) Where addition is based on information received from external sources in the nature of law enforcement agencies such as CBI / ED / DRI / SFIO / Directorate General of GST Intelligence (DGGI)". Admittedly, it is a settled position of law that quantum proceedings and penalty proceedings are independent and distinct proceedings and confirmation of an addition cannot on a standalone basis justify imposition/upholding of a penalty u/s 271(1)(c) of the Act. Adopting the same logic, we are of the considered view that unless a specific exception is provided in the circular w.r.t penalty also, it could by no means be construed that penalty was to be treated at....