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2021 (5) TMI 764 - AT - Income TaxPenalty u/s 271(1)(c) - addition of commission - HELD THAT:- From the perusal of the assessment order, it is clear that the addition was made merely because the assessee was unable to substantiate the rendition services by the commission agent in connection with the purchase of Tobacco from Shri Narayan Tobacco, Gopalpura, Dist. Anand, Gujarat. There is no positive evidence on record to say that the commission agent had not rendered any service, there is no the requirement under law that the name of the commission agent should be mentioned in the purchase bills. Mere inability to substantiate the claim does not entail the levy of penalty. It is settled proposition of law that the penalty cannot be levied for mere inability to substantiate the claim in the absence of any positive evidence to the contrary. Reliance in this regard can be placed on the decision of Hon’ble Supreme Court in the case of CIT vs. Reliance Petroproducts Pvt. Ltd., [2010 (3) TMI 80 - SUPREME COURT] We are of the considered opinion that the impugned order of penalty cannot be sustained in the eyes of law. Accordingly, the orders of the lower authorities are set-aside and we direct the Assessing Officer to delete the penalty levied u/s 271(1)(c) - Decided in favour of assessee.
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