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2012 (10) TMI 665 - AT - Income TaxLevy of Penalty - Excess purchase claimed by assessee and Disallowance of expenses - Held that:- There was a case of concealment of income insofar as the nomenclature “excess purchase” had been balanced by stock held by the assessee against which no controversy has been reported either by the Assessing Officer or the learned CIT(A). The purported income had been rendered to tax by the assessee itself. In other words, the claim of TCS as held by the authorities was a mere withholding of tax in which the deductor had committed error stood reconciled by indicating the purchases which was not an expenditure to be disallowed in view of the assessee holding physical stock of the said purchases. Similarly, part sustenance of expenditure disallowed under the various heads as Business promotion, depreciation cannot be a ground for levy of penalty u/s. 271(1)(c). Simply because a part of expenditure is unacceptable for deduction forming part of whole of the expenditure otherwise allowable clearly indicates that it was not a matter of concealment of income or for that matter furnishing of inaccurate particulars. Therefore, on this score, the penalty so levied u/s. 271(1)(c) does not have any legs to stand on.The said penalty of Rs.26,853 sustained by the learned CIT(A) is cancelled and the appeal of the assessee is allowed.
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