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2015 (12) TMI 30 - AT - Income TaxPenalty under section 271(1)(c) - Difference in stock as per bank statement vis-a-vis books of the assessee - Held that:- Revenue proceeds on the basis that difference between these two figures represents concealed income. That view is not entirely free from doubt as it is a ground reality that bank statements at times reflect inflated value of stocks so as to avail higher credit limits. There is nothing more than bank statement figure which is put against the assessee. Whatever be the merits of upholding addition on such facts, in our considered view, an addition of this nature cannot be visited with penalty proceedings. Hon’ble jurisdictional High Court’s judgment, in the case of CIT Vs Sachidanand Pulse Mills [2014 (12) TMI 750 - Gujarat high Court] holds so. Penalty in respect of declining deduction for write off due to joint venture having been aborted, we find that the Tribunal has confirmed the quantum addition. While doing so, the Tribunal, vide order had observed that "the resolution also passed after the financial year by the appellant and no copy of MOU dated 15.11.2003 has been furnished before any of the authorities below". The aspect regarding joint venture having been aborted was rejected on technical grounds. Such a loss, if it is indeed found to be on aborted joint venture, is generally allowable. It is also important to bear in mind that the AO did not even bother to given an opportunity of hearing because, as it appears from his observations extracted earlier in the order, he was of the view that findings in the assessment proceedings were good enough for imposing penalty as well. That is clearly an erroneous approach. In view of these discussions, the penalty in respect of write off was not justified either. The penalty in respect of depreciation already stands deleted and the AO is not in appeal. - Decided in favour of assessee
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