2022 (2) TMI 1343

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ed in not considering that the penalty was levied in respect of the addition made on the basis of information received from the Sales Tax Department, Maharashtra with regard to bogus purchase made by the assessee from dealers without supply of actual goods. 2. On the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting the penalty by not appreciating the fact that the assessee could not substantiate the genuineness of purchases from the said parties during assessment proceedings as well as penalty proceedings. 3. It is respectfully submitted that the penalty was levied for the additions made on the basis of information received from Law enforcement agency of the State Government of Maharashtra i.e. Sal....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....th the supporting evidences. But the AO was not satisfied with the explanations and the information and finally made an addition of Rs.5,44,589/- and assessed the total income of Rs.11,50,740/- and passed the order u/s 143(3) r.w.s 147 of the Act dated 30.03.2015. 3. Subsequently, the AO has initiated the penalty proceedings u/s 271(1)(c) of the Act. In the course of penalty proceedings it was brought to the knowledge of the Assessing officer that the assessee has filed an appeal with the CIT(A) on quantum addition of bogus purchases. Whereas, the CIT(A) has relied on the facts and judicial decisions and restricted the addition to the extent @ 25% of purchases and on further appeal the Honble Tribunal has restricted the addition to the e....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....at, the assessee has obtained bogus purchase bills and the same could not be overlooked and prayed for allowing the revenue appeal. 6. We heard the Ld.DR submissions and perused the material on record. The sole crux of the disputed issue as envisaged by the Ld.DR that the CIT(A) has erred in deleting the penalty overlooking the transactions of bogus purchases. Whereas, the Ld.CIT(A) considering the facts and circumstances observed that the penalty cannot be levied on estimated income. We are of the opinion that when the addition is on estimated basis, penalty u/s 271(1)(c) of the Act cannot be levied on such adhoc estimated income. The disallowance of purchases on ad-hoc basis does not tantamount to furnishing inaccurate particulars of i....