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2023 (5) TMI 30 - AT - Income TaxPenalty levied u/s. 271(1)(c) - Estimation of income on bogus purchases u/s. 69C - revenue contended that the assessee has failed to contradict the information received from the Maharashtra Sales Tax Department pertaining to the fact that the assessee was a beneficiary of bogus bills - HELD THAT:- Addition made by the A.O. was on the basis of the estimation calculated @ 12.5% on the bogus purchase alleged to be made by the assessee from M/s. Arihant Steel supposed to be hawala party as per the Sales Tax Department. This is an undisputed fact which has been agreed by the Revenue. Various courts have held that the penalty cannot be levied in cases where the addition has been made on estimated basis. As justified that this proposition is a settled principle of law. The decisions relied upon by the ld. DR will not hold the case of the Revenue in the present scenario. Hence, by respectfully following the decisions cited above, we find no justification in the penalty levied u/s. 271(1)(c) of the Act in assessee’s case. Decided in favour of assesee.
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