2024 (3) TMI 1073

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....jesh Bhende appearing on behalf of the assessee submitted that the Assessing Officer vide assessment order dated 23/03/2015 passed u/s. 143(3) r.w. 147 of the Act made addition of Rs. 1,00,15,634/- on account of bogus purchases. The Assessing Officer made addition of 100% of unproved purchases and initiated penalty proceedings u/s. 271(1)(c) of the Act on the said addition. The assessee carried the issue in appeal before the CIT(A). The CIT(A) on estimations restricted the addition to 12.5% of the alleged bogus purchases. The Assessing Officer vide order dated 31/03/2018 levied penalty u/s. 271(1)(c) of the Act in respect of the addition confirmed by the CIT(A). Against the order levying penalty, the assessee filed appeal before CIT(A). The....

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....count of alleged bogus purchases. The Assessing Officer made addition of 100% of unproved purchases, the CIT(A) restricted the addition to 12.5% of such purchases. The addition made by the Assessing Officer and subsequently restricted by the CIT(A) to 12.5% is merely on estimations. 5. The Hon'ble Rajasthan High Court in the case of CIT vs. Krishi Tyre Retreading and Rubber Industries reported as 360 ITR 580 has held that where addition is made purely on estimate basis, no penalty u/s. 271(l)(c) of the Act is leviable. Similar view has been expressed by the Hon'ble Punjab & Haryana High Court in the case of CIT vs. Sangrur Vanaspati Mills Ltd. reported as 303 ITR 53. The Hon'ble High Court approving the order of Tribunal held....