TMI Blog2018 (5) TMI 756X X X X Extracts X X X X X X X X Extracts X X X X ..... d deliberately and willfully subverted real source and character of the transactions. The assessee also prevented Revenue from knowing real source of supply and whereabouts of the supplier of the alleged goods purchased, if any. In the circumstances, appellate authorities were left with no option but to estimate a plausible overstatement of expenditure on purchases, and thereby understatement of profits. In these gross facts as recorded in the quantum proceedings, it is not a matter for consideration as to whether there was any concealment resorted by the assessee or not. Fact of under-statement of income is discernible. Only matter for consideration is extent of quantification of understatement of income. ITAT as a final fact findi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asis of search and survey proceedings in the case of Edible Oil Group, the AO found that one M/s.Vishal Traders ( VT for short), Virpur, Dist. Kheda had issued bogus adjustment bills to a large number of concerns of Mehsana and Patan districts of Gujarat during the financial year 2006-07 onwards towards supply, and the assessee is one of the beneficiaries of such accommodation bills. The AO made a very detailed inquiry into transactions and found that the assessee has declared purchases from VT only on the basis of bills/invoices issued by the said party which are bogus one. The AO after making detailed inquiry found that impugned transactions with VT are only an eye-wash and supplies purportedly made by the VT are fictitious. The AO a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Coordinate Bench has clearly observed in para 11 of its order that while purchase bills from VT may be adjusted bills, but the purchases itself are not bogus per se. The ld.AR submitted that it is nobody s case that purchases have not taken place at all. The finding in the quantum proceedings limited to the extent that purchases have not happened from VT as recorded in the books of accounts. As a corollary, it was inferred that actual purchases have been possibly made from unknown registered dealer. The assessee has been saddled with additional tax liability based on guess-work that the purchases made have not been correctly reported. The ld.AR thus submitted that where it has been found as a matter of fact that purchases did eventua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... different view in the matter of penalty. The ld.DR submitted that action of the AO and the CIT(A) towards imposition of penalty with reference to the decision of the Hon ble Gujarat High Court in the case of A.M. Shah Co. Vs. CIT, 238 ITR 415 and exhorted that penalty is leviable where discrepancy of such nature has been detected giving rise to the concealment of income, and in the light of falsity discovered in the course of survey and post survey inquiries. The ld.DR finally concluded that estimation have been made only to determine quantification of concealment. The fact of concealment is not in question at all in view of the decision of the Coordinate Bench in the quantum proceedings. 8. We have carefully considered rival submissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of under-statement of income is discernible. Only matter for consideration is extent of quantification of understatement of income. ITAT as a final fact finding authority has lent objectivity to such estimation. Thus, quarrel about quantum of estimated undisclosed income also does not survive any more. In these circumstances, we do not see any rational ground for granting latitude to the assessee in the matter of relief pleaded. The assessee has referred to certain case laws as noted above where a view has been taken that estimate addition does not necessarily call for imposition of penalty. However, facts as noted in elaboration in the quantum proceedings by the Coordinate Bench of ITAT (ITA No.948-1460/Ahd/2012 order dated 2.11.2017), ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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