TMI Blog2013 (8) TMI 475X X X X Extracts X X X X X X X X Extracts X X X X ..... not furnish the same. As regards the foreign gift in dispute which the assessee has received from his real brother who is residing in the USA and made the gift to the assessee out of love and affection through banking channel, for that the assessee has produced all necessary evidence in the assessment proceedings. As regards to the agricultural income declared by the assessee on estimation basis, which has been converted into the income of the assessee from other sources without appreciating the Revenue's record furnished before the Assessing Officer being ancestral land as per Jamabandi available with the assessment record. Penalty in dispute has been imposed is purely on estimation basis and the Assessing Officer has not brought any material on record to establish any mala fide intention of the assessee to evade tax in the return filed by the assessee - Following decision of CIT v. Metal Products of India [1984 (1) TMI 36 - PUNJAB AND HARYANA High Court] and Harigopal Singh v. CIT [2002 (8) TMI 65 - PUNJAB AND HARYANA High Court] - Decided against Revenue. - I.T.A. No. 451 (Asr)/2011 - - - Dated:- 5-9-2012 - Order The Revenue has filed the present appeal against the imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sting for setting aside the order dated July 2, 2007 passed by the Assessing Officer under section 144 of the Act with the direction to the Assessing Officer to give reasonable opportunity of being heard to the assessee and alternatively various additions and disallowances so made under different heads by the Assessing Officer may be directed to delete the order and the assessee may be granted any other legitimate relief for which the assessee is entitled. The learned Commissioner of Income-tax-1 Amritsar, vide his order dated October 21, 2008 directed the Assessing Officer to modify the assessment order to give relief of ₹ 10,000 on account of telephone expenses out of ₹ 40,420 and finally disposed of the petition filed by the assessee under section 264 of the Act. Keeping in view the facts and circumstances explained above, the Income-tax Officer, Ward 2(4), Batala initiated the proceedings under section 271(1)(c) of the Act, in the case of the assessee for the assessment year in dispute. He elaborated the facts of the case and issued a show-cause notice under section 271(1)(c) of the Act, dated January 21, 2009 to the assessee fixing the case for hearing on Januar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the learned first appellate authority has wrongly deleted the penalty in dispute merely on the ground that the Assessing Officer has made addition on estimated basis. He further stated that the assessee has withdrawn his appeal which he has filed before the learned Commissioner of Income-tax (Appeals) and resorted to section 264 of the Act, which was dismissed by the learned Commissioner of Income-tax-1 and the Income tax Officer had levied penalty in dispute in the case of the assessee. On the contrary, learned counsel for the assessee, Sh. Satish Gupta, advocate, relied upon the impugned order passed by the learned Commissioner of Income-tax (Appeals) and stated that the assessee has filed all documentary evidence supporting his claim before the Assessing Officer which includes statement of trading account, profit and loss account and the balance-sheet and audit report in Form No. 3CD duly signed by Sh. Anil Kumar, chartered accountant. This was not properly appreciated by the Assessing Officer and he completed the assessment under section 144 of the Act without giving sufficient opportunity to the assessee and made addition in dispute on estimation basis. No doubt, the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the competent person. No doubt, the assessee remained non-cooperative in the assessment proceedings due to the reasons mentioned by the assessee in the impugned order. In paragraph 6.1 at page 30, the reasons mentioned by the assessee for non-appearance before the Assessing Officer are that he remained pre-occupied in seeking allotment of dealership of Hero Honda and dealt with various department to whom a complaint was being pursued by unknown persons out of jealousy and ill-will which led him to remain absconded and underground for quite good time to avoid harassment. Secondly, the assessee has engaged Sh. Anil Gupta, chartered accountant, who failed to apprise the appellant about the day to day developments of the scrutiny case and ultimately, the Assessing Officer completed the assessment ex parte under section 144 of the Act on July 2, 2007. Thirdly, the assessee himself remained confined to bed being a heart patient during the period from May 8, 2007 onwards for which the assessee has produced prescription slips and copies of various clinical tests adduced before the learned first appellate authority. Fourthly, he took care of his two mentally retarded children who were in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsidered view, the Assessing Officer has levied the penalty in dispute on the addition made by the Assessing Officer on estimate basis which is against law and facts on file and contrary to the various decisions rendered by the hon'ble courts. We are of the view that in order to attract clause (c) of section 271(1), it is very much necessary that there must be concealment by the assessee of particulars of income or furnishing inaccurate particulars of such income. The provisions of section 271(1)(c) of the Act are not attracted to the cases where the income of the assessee is assessed on estimate basis. In the present case also, the Assessing Officer has not established any mala fide intention on the part of the assessee in filing the return. In the absence of the same, the penalty in dispute deserves to be cancelled. The assessee is not ipso facto liable for penalty until it is demonstrated that there was a mala fide intent on the part of the assessee or this was his deliberate Act. The Assessing Officer has to establish the assessee's mala fide intention to evade tax which he has failed to do so, in the present case and therefore, the penalty is not sustainable. This view ..... 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