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2022 (3) TMI 421 - AT - Income TaxPenalty u/s 271(1)(c) - Additions on estimated basis against the Bogus purchases - recording mandatory satisfaction as contemplated under the Act at the time of framing the assessment order - whether the AO has levied the penalty under the specific charge as contemplated under the provisions of section 271(1)(c)? - HELD THAT:- We refer the penalty order and find that the penalty has been levied on account of furnishing the inaccurate particulars of income which is the specific charge as provided under the provisions of section 271(1)(c) of the Act. Accordingly, we are not convinced with the ground of appeal raised by the assessee. Time limit for passing the penalty order - We find that there was nothing submitted by the assessee to justify that the penalty order has been passed beyond the time prescribed under the law. CIT (A) confirmed the assessment order vide order dated 25 January 2016, thus the financial year end as on 31st March 2016. Hence time limit to frame penalty order expire as on 31st March 2017 whereas penalty order was passed as on 26th March 2017. Therefore the same is within time limit provided under the provision of law. The penalty under the provisions of section 271(1)(c) of the Act can be levied either on account of concealment of income or furnishing inaccurate particulars of income - In this case the assessee has shown purchases from certain parties but failed to support the same based on the documentary evidence. Indeed the primary onus lies upon the assessee to justify the genuineness of the purchases. The assessee has only filed the copy of the ledger of the purchases from one-party. But the assessee failed to file the copies of the bill/invoices for the freight charges, octroi details of the vehicles used in the transportation of the goods. Thus it is clear that the assessee failed to discharge the onus cast upon it under the provisions of law. Admittedly, the assessee against the purchases has shown sales which were not doubted by the authorities below. Indeed, the sales are not possible without the corresponding purchases. Thus, the entire amount of purchases cannot be treated as income despite the fact that the assessee failed to discharge onus with respect to such purchases. ITAT estimated the amount of profit embedded in such purchases. But the estimation of profit does not lead to draw that the assessee cannot be held under the charge of furnishing the inaccurate particular of income. The percentage of profit is one of the method of determining the income in respect of which the inaccurate particulars of income was furnished. Accordingly we hold that, the assessee cannot discharge/ escape from the penalty levied under section 271(1)(c) of the Act. Thus we hold that the assessee cannot be escaped from the penalty provisions in a situation where the income was determined on estimated basis - Decided in favour of revenue.
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