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2015 (12) TMI 283 - AT - Income TaxPenalty u/s 271(1)(c) - whether penalty could not be levied where income has been enhanced merely on estimates as submitted by assessee - Held that:- The objections of the A.O. were that assessee had produced the books of account and various vouchers but the assessee has made petty cash payment against various expenses and primary vouchers for supporting the claim were not produced. There was one more objection of the AO that day to day stock inventory of raw material and other consumable item was not maintained. On the basis of these general objections, the AO made addition by adopting higher G.P. rate of 18.50% as against 18.02% declared by the assessee. Therefore, it is seen that in the present case, the A.O. has made the impugned addition without reference to any evidence/material being on record. Hence, by respectfully following this judgment of the Hon’ble Allahabad High Court in Sushil Kumar Sharad Kumar [1997 (9) TMI 76 - ALLAHABAD High Court] we hold that in the facts of the present case, levy of penalty on estimated addition is not justified and therefore, we delete the penalty. - Decided in favour of assessee.
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