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2015 (10) TMI 2498 - ITAT DELHI

2015 (10) TMI 2498 - ITAT DELHI - TMI - Penalty u/s. 271(1)(c) - addition made on account of bogus purchases - Held that:- It is not in dispute that the ld. CIT(A) deleted the addition made by AO on account of alleged bogus purchase. Besides, the addition made on the basis of estimation of gross profit rate does not warrant to hold that the assessee has furnished inaccurate particulars of income as held in plethora of decisions, relied upon by the ld. CIT(A) in the impugned order. The ld. DR cou .....

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dated 28.05.2013 passed by ld. CIT(A)-XIII, New Delhi, challenging the deletion of penalty amounting to ₹ 22,99,380/- imposed by the Assessing Officer u/s. 271(1)(c) of the IT Act, 1961 for the assessment year 2007-08. 2. Briefly stated, the facts of the case are that the assessee is engaged in the trading business electronic components. The assessment of the assessee was completed u/s. 143(3) at an income of ₹ 3,71,48,560/- as against returned income of ₹ 8,96,782/-, thereby .....

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e remand report called from the AO, held that merely because the parties were not traceable, the entire purchases could not be treated as bogus purchases, as the assessee had established the identity of the suppliers and suppliers were making substantial supplies not only to the assessee but also to various other customers of their own. Ultimately, it was held that the purchases made by the assessee were genuine. Accordingly, the addition of ₹ 3,62,49,274/- made by the AO on account of bog .....

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fferent reason. This order of the ld. CIT(A) stood confirmed by ITAT vide order dated 21.11.2014. The Assessing Officer, consequently, imposed penalty of ₹ 22,99,380/- on adhoc addition made by the ld. CIT(A) alleging that the assessee had furnished inaccurate particulars of income. The penalty so imposed by the AO stood deleted by the ld. first appellate authority vide impugned order. It is this order, which is assailed by the Revenue in this appeal before us. 4. During the course of hear .....

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s satisfaction of furnishing inaccurate particulars of income, stood deleted by the ld. CIT(A), the original basis of initiation of penalty proceedings stood collapsed and the AO had no jurisdiction to impose penalty on that basis. It was submitted that the Assessing Officer is not competent to impose penalty on the basis of a finding in the appeal and also the AO could not impose penalty in relation to an item of enhancement made by the first appellate authority. For this proposition, reliance .....

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ars by the assessee. He submitted that, therefore, the ld. CIT(A) has rightly held that there was neither any concealment of facts nor furnishing of inaccurate particulars by assessee. Reliance is placed on the decision in the case of CIT v. Navinchandra & Co. (222 Taxman 156 and New Holland Tractors (India) Pvt. Ltd. vs. CIT in ITA No. 182/2002 and 255/2003 (Delhi H.C.) and CIT vs. Aero Traders Pvt. Ltd., (2010) 322 ITR 316. 6. We have considered the rival submissions, perused the orders of .....

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