TMI Blog2021 (5) TMI 296X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of National Textiles [ 2000 (10) TMI 19 - GUJARAT HIGH COURT] has held that the penalty is not leviable when the profit was added on estimation basis. Taking into account all the facts and circumstances of the case, we are of the view that the CIT(Appeals) has decided the matter of controversy judiciously and correctly which is not liable to be interfere with - Decided against revenue. - I.T.A. No.4502/Mum/2019 - - - Dated:- 7-4-2021 - Shri Shamim Yahya, AM And Shri Amarjit Singh, JM For the Assessee : None For the Revenue : Shri Sanjay Sethi (DR) ORDER PER AMARJIT SINGH, JM: The revenue has filed the present appeal against the order dated 30.04.2019 passed by the Commissioner of Income Tax (Appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duce the profitability and thereby attempted to avoid taxes, which in itself proves beyond doubt that assessee furnished inaccurate particulars of income ? (4) The appellant prays that the order of Ld. C1T(A) on the above grounds be reversed and that of the Assessing Officer be restored. (5) The appellant craves leave to amend or alter any grounds or add a new ground which may be necessary. 3. The brief facts of the case are that the assessee filed its return of income for the A.Y.2011-12 on 23.09.2011 declaring a total income of ₹ 5,58,500. The return was processed u/s 143(1) of the I. T. Act, 1961. Notices u/s 147/148 of the Act on 04.03.2016 were issued and served upon the assessee. The case of the assessee was re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... O and the statement of facts. The AO had added ₹ 146,405/- to the total income of the assessee. Subsequently, the A.O. passed the penalty order u/s 27l(l)(c) of the Act on 20-04-2017 for furnishing inaccurate particulars of income and also for concealing the particulars of income by way of bogus claim of expenditure, levying a minimum leviable penalty of ₹ 43,922/- being 100% of the tax sought to be evaded. 6.2 The appellant has contended that the purchases made by the appellant are genuine and supported by valid documents. The appellant has also contended that it has not concealed any particulars of income nor has it furnished inaccurate particulars of income. The appellant has also contended that purchase was disallo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... net profit rate at 8 percent. Rejection of the books of account allowed the A. 0. to make the addition on estimate basis. When the addition is made on estimate basis, no penalty under Section 271(1)(c) of the I. T. Act can be imposed as per the ratio laid down in the case of CIT Vs. ArjunPrasad Ajit Kumar (2008) 214 CTR (All) 355, where it was observed that: Appeal (High Court) Substantial question of law Penalty under section 271(1)(C) CIT (A) deleted penalty under section 271(1)(c) on the ground that there being nothing on record that assessee's explanation lacked bone fides, penalty under section 271(1)(c) could not be imposed on the basis of estimating sales and making addition by applying net profit rate same was rightly sust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rticulars of income, there being are no findings of the AO that the details furnished by the appellant in his return are found to be inaccurate or erroneous or false. Accordingly, I delete the penalty of ₹ 43,922/- levied by the AO u/s. 271(1)(c) of the Act and the grounds of appeal are 'Allowed'. 5. On appraisal of the above mentioned finding, we noticed that the CIT(A) has decided the matter of controversy on the basis of decision of Hon ble Allahabad High Court in the case of Naresh Chand Agarwal Vs. CIT (367 ITR 0514)(All) and on the basis of the Hon ble ITAT, Mumbai Bench in the case of DGIT Circle 4(2)(2) Vs. M/s. Manohar Manak Alloys P. Ltd. and on the basis of the decision of Hon ble Mumbai Bench in the case of M/ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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