TaxTMI 
TaxTMI 
2024 (9) TMI 643
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.... penalty of Rs. 62,95,800 u/s. 271(1)(c) of the Act. On the facts and in the circumstances of the case, the said penalty be cancelled. 2) Gross Profit addition 2.1 THAT the learned CIT(A) failed to appreciate that question of levy of any penalty on account of GP addition made by the Hon'ble ITAT could not arise inasmuch as no such addition was made by the learned AO in the original assessment and consequently there was no initiation of penalty proceedings on this score. 2.2 THAT the teamed CIT(A) erroneously concluded that addition on account of GP was first made by the CIT(A) in lieu of addition u/s. 40A(2)(a) which was deleted by the learned CIT(A) and the addition on account of GP was reduced by Hon'bl....
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.... of which are distinguishable while ignoring the decisions relied upon by the appellant. 4.3 THAT the levy of penalty without specifying the charge as to whether it is for concealing income or for furnishing inaccurate particulars of income and without striking out the inappropriate words in the SCN u/s. 274 is bad in law and as such deserves to be cancelled. 4.4 THAT the learned AO and CIT(A) has seriously erred in not following the decision of the Hon'ble Supreme Court in CIT v. SSA's Emerald Meadows (2016) 242 Taxman 180 upholding decision of the Karnataka High Court in CIT v. Manjunatha Cotton & Ginning Factory. (359 ITR 564) 5. GENERAL 5.1 The appellant craves leave to add, amend, alter or delete any....
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....and subsequently imposed the penalty of Rs. 62,95,797/- u/s 271(1)(c) of the IT Act being minimum imposable penalty @ 100% of tax sought to be evaded on Rs. 1,85,22,500/- [Rs. 1,76,53,871/- + Rs. 3,08,889/- + Rs. 5,59,740/-]. Aggrieved with the penalty order, the appellant preferred an appeal before the ld. CIT(A)/NFAC, who vide impugned order 20.09.2023 confirmed the penalty u/s 271(1)(c) of the IT Act as imposed by the Assessing Officer. 5. Being aggrieved with the decision of the ld. CIT(A)/NFAC dated 20.09.2023, the assessee is in appeal before this Tribunal in the second round of appeal. 6. We have heard LD counsels from both the sides & perused the material available on record. We find that the AO levied penalty u/s 271(1)(c) of....
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....e Tax (A) had partially sustained the disallowance on an ad hoc basis without assigning any cogent reason for sustaining a part of the disallowance. The Ld. AR further submitted that it is settled law that penalty u/s 271(1)(c) of the Act could not be sustained in case of ad hoc/estimated disallowances. 4.0 In response, the Ld. Sr. DR placed reliance on the orders of the authorities below and vehemently argued that penalty had been rightly imposed and, therefore deserved to be upheld. 5.0 We have heard the rival submissions and perused the material available on record. The only question for our consideration is whether penalty u/s 271(1)(c) is sustainable with respect to disallowance which has been partially deleted by the....
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....of Rs. 3,08,889/- & the disallowance of Rs. 5,59,740/- on account of guest house expenses being capital in nature were also taken into consideration. In this regard, we find that it is true that both the above disallowances were confirmed by LD CIT(A) & also sustained by the ITAT. But, we are unable to accept the contention of LD CIT(A) that mere addition / disallowance warrant the imposition of penalty u/s 271(1)(c) of the IT Act. In this regard, the contention of LD AR is that the non-charging of interest on certain loans may result into a disallowance out of interest paid to others but the assessee cannot be said to have furnished inaccurate particulars of his income or concealed any income, as all the facts were disclosed truly & fully.....