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TMI Blog2021 (5) TMI 749X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 19.03.2014 under section 143(3) of the Income-tax Act, 1961 (hereinafter referred to as 'the Act'). 2. The only common issue in these two appeals of Revenue is against the order of CIT(A) deleting the levy of penalty by the Assessing Officer under section 271(1)(c) of the Act on account of bogus purchases. The Revenue has raised the identical worded grounds in both the years and the issue is exactly identical and hence, we will take the facts and grounds from AY 2009-10 in ITA No. 5617/Mum/2019. For this assessee has raised the following ground. The relevant ground raised i.e. ground Nos. 1 to 3 reads as under: - "(1) Whether on the facts and in the circumstances of the case and in law, the Ld. CIT (A) was correct in deleting the pen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment was completed under section 143(3) of the Act after making addition of unexplained expenditure in relation to obtaining of bogus bills from hawala parties under section 69C of the Act amounting to Rs. 1,57,12,013/-. In assessee's appeal, the CIT(A) reduced the addition and restricted the same to the profit element of 15% of the alleged bogus purchases and ITAT, further reduced 3.5%. The Assessing Officer started the penalty proceedings and levied the penalty of Rs. 6,63,190/- for furnishing of inaccurate particulars of income by submitting the bogus bills obtaining from hawala operators. Aggrieved, assessee preferred the appeal before Commissioner of Income Tax (Appeals). The CIT(A) after going through the facts of the case delet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Allahabad High Court in the case of Naresh Chand Agarwal vs. CIT, 357/YR 0514 (All), it has been held that: "12. In the instant case, nothing was concealed by the assessee. It was the A. 0. who has rejected the books of account in the second round and applied the 8 percent net profit rate prescribed under Section 44 AD, In the instant case, the turnover is more than 40 lacs, so Section 44 AD is not applicable, nonetheless the A. 0. has inspired with the provision of Section 44 AD and made the addition by estimating the 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 Income Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TO(2017) 49 CCH 0066 Mum Trib., it has been held that where income has been estimated, the appellant cannot be said to have concealed particulars of income or furnished inaccurate particulars of income and therefore, penalty u/s 271 (1)(c) was not leviable. 6.5 In the background of the aforesaid discussions and respectfully following the precedents, as above and those relied upon by the appellant, I am of the considered view that the appellant has not concealed the particulars of income and nor has it furnished inaccurate particulars 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 Rs. 6,63,190/- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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