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2014 (5) TMI 735 - AT - Income TaxPenalty u/s 271(1)(c) of the Act – Cash purchases – Confirmation of quantum addition - Held that:- CIT(A) has rightly analysed and concluded that it was indeed not a fit case for imposition of penalty - The mere fact that the sale vouchers were titled as cash memos does not obliterate the fact that the vendor was paid for the bricks subsequently and it is thus a reasonable explanation that purchases were made on credit - There is nothing on record to establish, beyond a reasonable doubt, that any cash purchases did take place - the AO has not given any independent reasons for imposing the penalty but has merely referred to and relied upon the fact that the Tribunal has confirmed the quantum addition. Findings in the quantum proceedings have an important role to play in penalty proceedings as well in the sense that these findings can be referred to and relying upon in the penalty proceedings as well, but the confirmation of quantum addition cannot be reason enough for imposing the concealment penalty u/s 271(1)(c), as has been done in the case - Penalty is and cannot be an automatic consequence of quantum addition and be justified on that count – AO cannot summarily make sweeping generalizations without pointing out in what manner the cases are distinguishable and why the legal propositions laid down by the judicial precedents do not apply to the facts of the case – the very well-reasoned order of the CIT(A) is upheld – Decided against Revenue.
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