Bogus Purchases Case: Tax Tribunal Rejects Automatic Penalties, Requires Specific Evidence of Intentional Misrepresentation

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....The ITAT addressed penalty proceedings u/s 271(1)(c) involving alleged bogus purchases. Despite initial additions for estimated profits, the Tribunal found inconsistencies in penalty levy across assessment years. Applying the doctrine of binding precedent and referencing SC precedent in Reliance Petroproducts, the Tribunal held that a mere unsustainable claim does not automatically constitute furnishing inaccurate particulars. The Tribunal emphasized that without specific findings of incorrect or false return details, penalty imposition was unwarranted. Consequently, the appeals challenging penalty orders for AYs 2008-09 and 2009-10 were allowed, setting aside the CIT(A)'s earlier confirmations and maintaining consistency with the 2007-08 assessment year's order.....