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2021 (7) TMI 877 - AT - Income TaxPenalty u/s 271(1)(c) - Addition of 12.5% of the bogus purchases - HELD THAT:- It is now well settled that because the assessee has not contested the quantum addition made by the Assessing Officer, the penalty under section 271(1)(c) of the Act for furnishing inaccurate particulars of income by the Assessing Officer is unsustainable in the eyes of law. Assessing Officer imposed penalty under section 271(1)(c) of the Act on estimation basis without adducing any evidence on record for concealment of income. Penalty under section 271(1)(c) of the Act is liable to be imposed only where the assessee has concealed its particulars of income or furnished inaccurate particulars. Action of making addition on ad–hoc basis does not result into imposition of penalty u/s 271(1)(c) of the Act and hence cannot be termed as either concealment or furnishing of inaccurate particulars of income. We find support from the series of decisions by different High Courts as well the decision of the Co–ordinate Benches of the Tribunal, wherein it was held that when addition is made on estimate basis, penalty is not sustainable in the eyes of law - Decided against revenue.
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