TMI Blog2019 (9) TMI 611X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT(A) has passed the order confirming the penalty on the full amount as the benefit of the decision of the ITAT was not available to the CIT(A) while passing the appellate order in respect of penalty proceedings. We thus find merit in the plea of the assessee for reduction in the quantum or penalty in tune with the reduction in the quantum additions based on the order of the ITAT. The AO is accordingly directed to re-work the penalty based on the amount of additions quantified by the ITAT in quantum proceedings. - I.T.A. Nos. 524 And 525/Ahd/2018 - - - Dated:- 11-9-2019 - Shri Rajpal Yadav, Judicial Member And Shri Pradip Kumar Kedia, Accountant Member For the Appellant : Shri P. F. Jain, A.R. For the Respondent : Shri Aditya Shukla, Sr.D.R. ORDER PER PRADIP KUMAR KEDIA - AM: The captioned appeals have been filed at the instance of the assessee against the orders of the Commissioner of Income Tax (Appeals)-5, Ahmedabad ( CIT(A) in short), dated 02.02.2018 arising in the penalty order dated 08.08.2016 passed by the Assessing Officer (AO) under s. 271(1)(c) of the Income Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me of the assessee. As a consequence of the ITAT s order, the CIT(A) confirmed the action of the AO towards imposition of penalty to the extent of addition sustained. The penalty imposed of ₹ 3,39,710/- was accordingly scaled down by the CIT(A) to ₹ 1,69,855/-. 6. Aggrieved by the partial confirmation of penalty, the assessee is in appeal before the Tribunal. 7. The learned AR for the assessee relied upon the order of the ITAT and submitted that in the light of the order of the ITAT one cannot say with clarity that the cash deposits in the bank account are unexplained. The addition has been made out on estimated basis which does not warrant onerous imposition of penalty. The learned AR also relied upon the order of the ITAT in the case of Shri Anil Yashpal Khosla vs. ITO ITA Nos. 1078 1079/Ahd/2015 order dated 19.03.2018 where the penalty was deleted in respect of cash deposits. The learned AR also contended that in the alternative that the notice issued by the AO for the imposition of penalty was vague and non-descript. The notice did not specify the nature of default committed by the assessee and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 68 and 69 is may and not shall and therefore the unsatisfactory explanation will not entitle the AO to treat the same as income of the assessee. The appellant has relied upon the decisions as cited above. It is also contended that notice being defective and in the assessment order also no specific default for penalty has been mentioned hence on this ground also penalty is also not leviable. 3.5. Facts of the case and the submissions are considered. A perusal of assessment order and penalty order shows that the AO has very much clear before levying the penalty and clearly stated the default committed by the appellant for levying the penalty u/s.271(1)(c) of the Act. A perusal of show cause notice issued u/s.271(1)(c) of the Act is clearly shows that the penalty has been initiated on two counts i.e. concealment of the particulars of income and furnishing of inaccurate particulars of such income. The appellant has furnished inaccurate particulars of his income and by furnishing of such inaccurate particulars she has concealed his income on which account the AO has levied penalty u/s.271(1)(c) of the Act. The contention of the appellant that the AO is not affi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Further the Hon'ble ITAT has categorically stated in its order that the assessee has not furnished any details in support of his claim of business receipts. A perusal of order- of the Hon'ble ITAT clearly shows that the appellant has failed to furnish explanation regarding the cash deposits. The Hon'ble ITAT has sustained additions of 50% as the assessee has failed to furnish explanation for entire amount of the cash deposits. The appellant's contention that it becomes an estimate addition is not correct as the addition made by the AO is not at all on any estimates. There was a clear cut finding given by the AO that the assessee has failed to explain cash deposits. The addition was reduced to 50% by the Hon'ble ITAT as the appellant has explained the deposits lo the tune of 50% of total deposits. Considering the above, it is very much clear that (he appellant has defaulted the provisions of Section 271(1)(c) of the Act and the AO has levied the penalty correctly. However, as the addition is reduced to 50% of total addition, the penalty is also reduced to that extent. Thus the grounds of appeal are partly allowed. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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