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2021 (3) TMI 761 - AT - Income TaxPenalty u/s. 271(1)(c) - bogus purchases - disallowance to an extent of 12.5% of the non-genuine purchases - HELD THAT:- It is a settled position of law that penalty cannot be levied when an ad hoc estimation is made. In this case Assessing Officer treated entire purchases as non-genuine. Ld. CIT(A) considering the evidences and various submissions of the assessee restricted the disallowance to an extent of 12.5% of the non-genuine purchases. Similar view has been taken by the Hon'ble Delhi High Court in the case of CIT v. Aero Traders Pvt. Ltd. [2010 (1) TMI 32 - DELHI HIGH COURT] wherein affirmed the order of the Tribunal in holding that estimated rate of profit applied on the turnover of the assessee does not amount to concealment or furnishing inaccurate particulars. In the case on hand the Ld. CIT(A) observed that the penalty was imposed based on estimation basis and following the decision in the case of Harigopal Singh v. CIT [2002 (8) TMI 65 - PUNJAB AND HARYANA HIGH COURT] deleted the penalty levied by the Assessing Officer. Thus, we do not observe any infirmity in the order passed by the Ld. CIT(A) in deleting the penalty u/s. 271(1)(c) of the Act levied by the Assessing Officer for the Assessment Year. Grounds raised by the revenue are rejected. Appeal of the revenue is dismissed.
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