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TMI Blog2015 (10) TMI 579X X X X Extracts X X X X X X X X Extracts X X X X ..... ed out a survey operation u/s 133A of the Act on 22-3-2007. During the course of survey operation, it was noticed that the assessee company did not maintain the stock register and further it could not produce its books of account for verification. Later, the A.O. completed the assessment to the best of his judgment u/s 144 of the Act. The AO included the unaccounted sales in the total turnover reported by the assessee. The A.O. also rejected the books of account and estimated the gross profit at 20% of the sales (both accounted and unaccounted). The A.O. also disallowed 40% of the administrative expenses claimed by the assessee. In the appellate proceedings, the ld. CIT(A) reduced the rate of gross profit to 8% as against 20% adopted by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the assessee prayed for deletion of penalty in the present case also. 6. The ld. D.R., on the other hand, placed strong reliance on the order passed by the ld. CIT(A). 7. The ld. Counsel for the assessee also furnished a copy of the order dated 12-2-2014 passed by the Tribunal in the case of M/s P. Kishanchand Textiles Limited in ITA 7156/Mum/2012 referred supra. For the sake of convenience, we extract below the operative portion of the said order: "9. We have considered the submissions of both the parties and carefully gone through the material available on record. In the instant case it is an admitted fact that the AO estimated the income of the assessee on estimate basis. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see and estimated the income at Rs. 61,00,000 as against returned loss of Rs. 83,64,468 - CIT(A) deleted the levy of penalty under s.271(1)(c) on the ground that the addition was made by the AO on the basis of estimated profit and the same has been substantially reduced by the Tribunal - Finding arrived at by the Tribunal does not warrant interference as it is purely a finding of fact - No perversity has been pointed out in such a finding - Consequently, no substantial question of law arises for consideration." 11. While dismissing the appeal of the department on the basis of the aforesaid facts, the Hon'ble Delhi High Court held as under:- "The assessee-company filed its retur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 12. In the present case also the income of the assessee was determined by applying the gross profit rate and by making the disallowance out of the expenses on estimate basis. The learned CIT(A) also sustained the addition on estimate basis, so it cannot be said that the assessee concealed the income or furnished inaccurate particulars of income. 13. On a similar issue, the Hon'ble Punjab & Haryana High Court in the case of Harigopal Singh v. CIT [(2002) 258 ITR 85 (P&H)] held as under:- "that there was a difference of opinion as regards the estimate of the income of the assessee. Since the Assessing Officer and the Tribunal adopted different estimates in assessing the i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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