TaxTMI 
TaxTMI 
2017 (3) TMI 1885
X X X X Extracts X X X X
X X X X Extracts X X X X
....y of penalty?" 3. Counsel for the appellant has contended that the Assessing Officer has considered the case of the assessee and observed as under: "As for bogus purchases of cut goods shown in the name of the said two parties, it is to stated that the sources of purchase are not explained as these parties have not been produced for my examination and that the same are not available at the given addresses. It is the assessee itself who introduced own money as invested in the shape of above purchase/shown initially as credit purchases in the name of the persons who do not exist. The assessee introduced its own unaccounted money in the shape of these purchases which were later on labled as credit purchases so as to give them colour of genuineness. The assessee has, therefore, made investment in the shape of credit purchases in the name of the above persons. Accordingly, the investment in the alleged unproved purchases represented assessee's own income from undisclosed sources. Such purchases amount of Rs. 1,06,717/- represents assessee's income from undisclosed sources." 4. Counsel for the appellant has further contended that the CIT(A) while considered the case of the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....further been contended that the Tribunal while considering the case in para 3 has observed as under: "After hearing both the parties and on perusal of material available on record, it appears that in quantum appeal (ITA No.1874 to 1877/JP/95) dated 26.09.2002 the Tribunal finally reduced the additions to Rs. 2,23,945/- pertaining to the following components: Trading Addition Rs. 39,092/- ITAT Page 11 Bogus Purchase Rs. 1,71,917/- 2-9 Salarly to Babu Bhai Rs. 10,800/- 14 Disallowance of Dalali Rs. 2,136/- 15" 6. Counsel for the appellant has further contended that the Gujarat High Court in the case of National Textiles vs. Commissioner of Income Tax reported in 249 ITR 0125 in para 21-24 has observed as under: "21. The provisions of section 68 permitting the assessing officer to treat unexplained cash credit as income are enabling provisions for making certain additions, where there is failure by the assessee to give an explanation or where the explanation is not to the satisfaction of the assessing officer. However, the addition made on this count would not automatically justify imposition of penalty under section 271(1)(c) b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....their particulars nor any supporting documents were on record. Only 2 entries were explained. The accountant who had arranged the loan was not produced stating that he had left the service and relations with him are strained. On this state of accounts and evidence in the quantum proceedings, the department was justified in treating the cash credit as income of the assessee but merely on that basis by recourse to Explanation 1, penalty under section 271(1)(c) could not have been imposed without the department making any other effort to come to a conclusion that the cash credits could in no circumstances would have been amounts received as temporary loans from various parties. The assessee in the quantum proceedings failed to produce the accountant but the department also in penalty proceedings made no effort to summon him. Applying the test (ii) discussed above, therefore, it was a case where there was no circumstance to lead to a reasonable and positive inference that the assessee's case that the cash credits were arranged as temporary loans, was false. The facts and circumstances are equally consistent with the hypothesis that it could have been sundry loans in small amounts o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ntended that the view taken by the Tribunal is required to be reversed. 9. Counsel for the department has contended that the Supreme Court in the case of Commissioner of Income Tax vs. Reliance Petroproducts Pvt. Ltd. reported in [2010] 322 ITR 158 (SC) has observed in para 10 & 11 as under: "10. We are not concerned in the present case with the mens rea. However, we have to only see as to whether in this case, as a matter of fact, the assessee has given inaccurate particulars. In Webster's Dictionary, the word "inaccurate" has been defined as:- "not accurate, not exact or correct; not according to truth; erroneous; as an inaccurate statement, copy or transcript". 11. We have already seen the meaning of the word "particulars" in the earlier part of this judgment. Reading the words in conjunction, they must mean the details supplied in the Return, which are not accurate, not exact or correct, not according to truth or erroneous. We must hasten to add here that in this case, there is no finding that any details supplied by the assessee in its Return were found to be incorrect or erroneous or false. Such not being the case, there would be no question of inviti....