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TMI Blog2016 (7) TMI 1533X X X X Extracts X X X X X X X X Extracts X X X X ..... red in confirming the levy of penalty of Rs. 3,60,200/-." 2. The solitary issue in this appeal is with regard to levy of penalty of Rs. 3,60,200/-. 3. The brief background and facts of the case are that during the year, assessee was engaged in the business of 'builder and developer'. During the course of assessment proceedings, it was noted by the assessing officer that Assessee Company was following percentage completion method of accounting whereby Assessee Company was estimating gross profit on work done basis. It was also noticed by the assessing officer that percentage of gross profit determined on the basis of work done of various preceding years had lot of variations and there was lack of consistency in the results shown. U ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty order. The A.O. had elaborated at para 2 of the penalty order the reasons for which the method of computation of gross profit and the valuation of work-in-progress was flawed. The A.O. proposed adoption of G.P. of 14% of the works done and vide letter dated 18.12.09 the assessee company accepted the flaws and offered additional income of Rs. 10.5 Lacs. Thus, the disclosure of additional income was after the analysis and examination of books of a/c. and detection of mistakes by A.O in the books and thus the disclosure cannot be said to be voluntary but was prompted at the instance of A.O. Under these circumstances the levy of penalty by A.O. is justified and is confirmed." 5. Being aggrieved, the assessee filed appeal before us and subm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e circumstances, it is noted that nothing has been brought on record by the lower authorities to show any concealment of income. The addition made on estimate basis cannot be put into the category of concealed income by any stretch of imagination. The AO made the addition because in his opinion, the GP of the assessee was to be estimated at a particular percentage. The opinion of the AO was purely subjective and discretionary and without any concrete basis. Under these circumstances, no penalty can be levied, as per law. In this regard, we find support from the judgement of Hon'ble Bombay High Court in the case of CIT vs Upendra V Mithani dt 5-8-2009 (Income Tax Appeal No.1860 of 2009) wherein Hon'ble High Court has observed as under: "T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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