TMI Blog2004 (1) TMI 336X X X X Extracts X X X X X X X X Extracts X X X X ..... ition of Rs. 4,72,280 on 14th March, 1996. The AO had taken the receipts from bus plying business at Rs. 16,95,506 as against the receipts shown by assessee at Rs. 10,96,370 and applied the net profit rate of 33 per cent. The matter travelled upto the Tribunal level and the Tribunal directed the AO to compute the income by applying a net profit rate of 20 per cent subject to depreciation and interest to third parties. The AO had imposed the penalty holding the difference of income as computed on the basis of the decision of the Tribunal in case of the assessee and income as shown by the assessee as concealed income. The difference of income was computed at Rs. 1,94,900 and the same was considered as the concealed income of the assessee. Con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ering the submissions of the assessee observed that simply because books of accounts were rejected and provisions of s. 145(2) were applied and thereby a particular net profit rate is applied for computing the income while passing the assessment order, it did not become a case of concealment. He further observed that the difference of income was only on account of application of a particular flat rate and it did not amount to concealment of income. He, therefore, following the decision of Tribunal, Jaipur Bench in case of Asstt. CIT vs. Milap Textile Mills and the judgment of Hon ble Allahabad High Court in case of CIT vs. K.L. Mangal Sain held that the AO was not justified in imposing the penalty. Accordingly the penalty was cancelled. 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y a net profit rate of 20 per cent subject to depreciation and interest to third parties. From the above facts it would be clear that there was an estimate at the level of the AO as well as at the level of Tribunal in respect of receipts as well as net profit rate. The above facts clearly show that the income of the assessee was estimated and nothing has been brought on record by the AO that the assessee concealed any particulars of income or furnished inaccurate particulars of income. Their Lordships in the case of Shiv Lal Tak vs. CIT at p. 381 observed that: "In making computation of total income where the income returned has been rejected by rejecting the trading results, finding some discrepancy in the books of account and substituti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view of the matter also the penalty was not leviable under s. 271(1)(c) of the IT Act. Similarly the Hon ble Punjab Haryana High Court in the case of Harigopal Singh vs. CIT (2002) 177 CTR (P H) 580 : (2002) 258 ITR 85 (P H), held that "there was a difference of opinion as regards the estimate of income of the assessee. Since the AO and the Tribunal adopted different estimates in assessing the income of the assessee, it could not be said that the assessee had concealed the particulars of income so as to attract cl. (c) of s. 271(1)". The ratio of above decision laid down by the Punjab Haryana High Court is squarely applicable to the facts of the present case, therefore, the learned CIT(A) was justified in deleting the penalty. A similar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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