TMI Blog2021 (5) TMI 749X X X X Extracts X X X X X X X X Extracts X X X X ..... sales are no doubted, it is doubtful, whether the purchases are bogus or not. Once, there is doubt, the penalty cannot be levied under section 271(1)(c) of the Act for furnishing of inaccurate particulars of income because, the assessee has not furnished any inaccurate particulars of income in this case. Hence, we are of the view that CIT(A) has rightly deleted the penalty and we confirm the same. - Decided against revenue. - ITA No. 5617/Mum/2019, ITA No. 5651/Mum/2019 - - - Dated:- 25-3-2021 - Sri Mahavir Singh, VP And Sri S Rifaur Rahman, AM For the Appellant : Shri Kailash Kanojia, DR for the Respondent : Shri Satyaprakash Singh, AR ORDER PER MAHAVIR SINGH, VP: These appeals of Revenue are arisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... correct in holding that the AO has estimated the income without appreciating that the AO has levied penalty, only after verifying the fact that the assessee evaded the taxes on quantum of additions made on account of bogus purchases and the assessee failed to establish the genuineness of such purchases? (3) Whether on the facts and in the circumstances of the case and in law, the Ld. CIT (A) was correct in holding that the assessee has neither concealed the particulars of income nor has it furnished inaccurate particulars of income , there being are no finding of the AO that the details furnished by the assessee in his return are found be inaccurate or erroneous or false, without appreciating the fact that by resorting to bogus purch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the A.O. passed the penalty order u/s 271 (1 )(c) of the Act 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 ₹ 6,63,190/- being 100% of the tax sought to be evaded. 6.2 The AO had added entire bogus purchases which was reduced to 15% by the CIT(A), order dated 13/12/2016, Hon'ble ITAT enhanced the addition to 3.50% vide order dated 31107/2017, i.e. much after the passing of penalty order. There are a plethora of court decisions which say that whore additions are made on estimation, no penalty u/s 271(1)(c) is leviable, there being no concealment of particulars of income or furnishing of inaccurate p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lty under section 271(1)(c) could not be imposed on the basis of estimating sales and making addition by applying net profit rateSame was rightly sustained by Tribunal and no substantial question of law arises 6.4 On the similar set of facts, the Hon ble ITAT, Mumbai has deleted penalty u/s. 271(1)(c) of the Act in 1TA No. 5586/Mum/2015 dated 16.01.2017 in the case of DCIT Cir 4(2)(2) vs. M/s. Manohar Manak Alloys P. Ltd. On the same times, the Hon'ble ITAT, Mumbai in ITA No. 7519/Mum/2013 dated 08. 07.2015 in the case of M/s. Yashraj Films P. Ltd. vs. The A.C.I.T. Central Circle 29, Mumbai has deleted the penalty u/s. 271(1)(c) of the Act levied on addition made on estimation basis. Likewise, the Hon'ble ITAT, Mumbai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ces of purchases, payment was made by account payee cheque and further, the stock tally was also produced before the Assessing Officer during the assessment proceedings. Once, all the documentary evidences were produced before the Assessing Officer and sales are no doubted, it is doubtful, whether the purchases are bogus or not. Once, there is doubt, the penalty cannot be levied under section 271(1)(c) of the Act for furnishing of inaccurate particulars of income because, the assessee has not furnished any inaccurate particulars of income in this case. Hence, we are of the view that CIT(A) has rightly deleted the penalty and we confirm the same. 5. In the result, both the appeals of Revenue are dismissed. Order pronounced in the o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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