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2021 (7) TMI 1217 - AT - Income TaxPenalty u/s 271(1)(c) - disallowance on account of direct expenses - HELD THAT:- Whether or not the learned CIT(A) was justified in deleting the penalty u/s 271(1)(c) of the Act imposed by the AO. After hearing the Departmental Representative, we are of the considered opinion that penalty u/s 271(1)(c) levied by AO has no legs to stand, when the corresponding additions made by the AO has already been reduced substantially on the basis of estimation by the Tribunal - when the aforesaid quantum addition is based purely on estimation, the penalty levied u/s 271(1)(c) cannot be sustained. Such proposition of law has been laid down by the Tribunal time and again in plethora of cases. Consequently, we do not have enough reason or do not find any infirmity in the order of the learned CIT(A) deleting the penalty under section 271(1)(c) of the Act imposed by the AO. Accordingly, the order of the learned CIT(A) is hereby upheld. The grounds raised by the Revenue are dismissed.
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