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2018 (1) TMI 1422 - ITAT JAIPURPenalty levied u/s 271(1)(c) - addition @25% of unverifiable purchases while completing the assessment u/s 143(3) - Held that:- There is no definite finding by the AO that the assessee has inflated the purchase to the extent of 25% but it was only estimation of the AO to make addition which was subsequently restricted by this Tribunal to 15% of unverifiable purchase. Thus even the addition in quantum proceedings attained the finality it is not based on the finding that the assessee has inflated the purchases and suppressed the income or claim of the assessee was absolutely bogus. AO has only doubted the purchases from certain parties and made the addition only to the extent of 25% of purchases made from such parties instead of disallowing entire purchases from those parties. When the AO has not given any finding of bogus purchases then the disallowance made by the AO is only based on estimation which was restricted by this Tribunal as reasonable estimated. Accordingly, the issue of levy of penalty u/s 271(1)(c) of such addition is now covered by case of CIT vs. Mahendra Singh Khedla [2012 (3) TMI 568 - RAJASTHAN HIGH COURT]. - Decided in favour of assessee.
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