TMI Blog1999 (8) TMI 706X X X X Extracts X X X X X X X X Extracts X X X X ..... facts, giving rise to appeal by the Revenue and the cross-objections by the assessee, are that assessee filed return for assessment year 1988-89 at an income of Rs. 1,31,210 and assessment was completed at an income of Rs. 13,53,600. The additions resulting into the assessment of total income of Rs. 13,53,600 included an amount of Rs. 10,76,413 out of liabilities appearing in the balance sheet as on 31-3-1988 which were treated as unexplained and Rs. 1,21,000 on account of the stock sold outside the books of account. The Assessing Officer initiated penalty proceedings for these additions by serving a notice under section 274 read with section 271(1)( c ) of the Income-tax Act, 1961. The assessee s submission before the Assessing Officer wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 1,21,000 on account of the sale of stock outside the books of account is concerned, it was noted by the CIT(A) that assessee had claimed burning loss of 16,944 kg. but the Assessing Officer had allowed the wastage to the extent of 1,780 kg. and balance 15,164 kg. was held to be the sales effected out side the books of account. It was also noted by the CIT(A) that the amount of Rs. 1,21,000 was confirmed by the CIT(A) in quantum appeal and his action was upheld by the ITAT in quantum appeal. The plea of the assessee that this addition resulted on the basis of difference of opinion was not appreciated by the CIT(A) on the ground that in this case the assessee intentionally did not agree to the suggestion of the CIT(A) that Assessing Office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e case of assessee for this very assessment year has restored the matter back to the file of the Assessing Officer in relation to addition of Rs. 8,46,594 and CIT(A) was justified in observing that penalty could not be allowed to be sustained as matter of addition was with the Assessing Officer who was at liberty to initiate penalty proceedings afresh if he so desires. Accordingly the appeal of the Revenue is not maintainable and the cross-objection No. 25/Del/97 becomes infructuous and stands rejected accordingly. 3. Now we are left with cross-objection No. 14/Del/96 which relates to the order of the CIT(A) by which he has sustained the order of penalty leviable on amount of Rs. 1,21,000 which was on account of sale of steel items outs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 5. The contention of the learned counsel is that it is a question of difference of opinion. The assessee had claimed wastage as claimed by him in the earlier years and accepted by the Department. It is another thing that Department has not accepted the rate of wastage claimed by the assessee and concluded that 0.85 per cent was the reasonable amount of wastage and in such circumstances no penalty can be imposed under section 271(1)( c ) though it may be a good ground for making the addition. He has also invited our attention to the copy of CIT(A) s order dated 17-3-1997 in the case of M/s Haryana Metal Co. for assessment year 1988-89 in which penalty of Rs. 16,660 on similar facts was deleted. Copy of that order is appearing at pages ..... X X X X Extracts X X X X X X X X Extracts X X X X
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