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2015 (1) TMI 521 - AT - Income TaxPenalty imposed u/s 271(1)(c) read with section 274 - assessment u/s 153A - revenue aggrieved by cancelling the penalty on the disallowances made and deleted on the additional profit at the rate of 1% of the sales amounting to ₹ 38,91,422/- - Held that:- Mere revision of income to a higher figure does not automatically warrant inference of concealment of income, consequently, it was held that penalty imposed u/s 271(1)(c) of the Act was not valid and thus deleting the penalty by the Tribunal was held to be justified. It is also noted that the ld. Commissioner of Income tax (Appeals), while examining the assessment order/penalty order has dealt with the disallowances/additions, individually/separately and after full analysis of the same came to a particular conclusion holding that the estimation was either not maintainable or towards higher side. It is not the case that the ld. Commissioner deleted the penalty without analyzing the facts and suddenly reached to a particular conclusion. In view of these facts, we find no infirmity in the conclusion drawn by the ld. Commissioner of Income tax (Appeals), consequently, the order of the First Appellate Authority is upheld. - Decided gainst Revenue. Penalty with respect to alleged bogus purchases upheld by CIT - Held that:- There is a contradiction in the conclusion arrived at in the assessment order with respect to purchases. The AO made the addition by holding that since the corresponding sales have been made, therefore, the assessee purchased the goods not from M/s Triton Infotech Pvt. Ltd. but from the grey market to avoid local taxes such as sales tax, VAT, etc. Thus, he made disallowance of 20% of the total purchases which resulted into addition of ₹ 55,72,000/-. The ld. Commissioner of Income tax (Appeals) reduced the addition to ₹ 11,20,000/-. However, during search & seizure operation, as per the Revenue, documents were found and seized and it was concluded that the assessee company made purchases from M/s Triton Infotech Pvt. Ltd. The statement of Shri K.K. Gupta was recorded, who tendered that no actual sales were made to the assessee and only accommodation bills were received. What it may be the fact remains that the ld. Assessing Officer relied upon the statement of Shri K.K. Gupta and even no opportunity was provided to the assessee to cross examine him, which is against the principle of natural justice. It seems the whole addition is either based on estimation or on the basis of statement of Shri K.K. Gupta, thus in our view, at least penalty is not imposable. It may be a good case for quantum addition but not for imposing penalty. Estimation is outcome of subjective approach of the individual. If we sustain the part penalty even after a huge surrender made by the assessee then the faith of the assessee will shake. Penalty deleted. - Decided in favour of assessee.
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