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TMI Blog2023 (6) TMI 1370X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 271(1)(c) of the Income Tax Act, 1961 (in short 'the Act') in all the three years under consideration. 2. The facts relating to the case are stated in brief. The assessee is engaged in the business of manufacturing and trading of diamonds. The Assessing Officer reopened assessment for all the years under consideration by issuing notices under Section 148 of the Act on the basis of information that the assessee made bogus purchases by availing accommodation entries from Bhanwarlal Jain group. The Assessing Officer concluded the assessments by estimating profit from alleged bogus purchases at 12.5%. In the appellate proceedings, the Ld. CIT(A) reduced the rate of profit to 6%. After the orders passed by Ld. CIT(A), the Assessing Office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... addition has been made on estimated basis in all the three years under consideration. The question is whether penalty under Section 271(1)(c) of the Act could be levied on addition made on estimated basis. This question was examined by the co-ordinate bench in assessee's own case and it was held that penalty under Section 271(1)(c) of the Act is not leviable on addition made on estimated basis. For the sake of convenience, we extract below the operative portion of the order passed by the co-ordinate bench in Assessment Year 2013-14 :- "9. We have heard the submissions made by rival sides and have examined the orders of the authorities below. Undisputedly, the additions made on account of bogus purchases were partially confirmed by the Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourts and various Benches of the Tribunal wherein penalty levied u/s. 271(1)(c) of the Act on estimated addition has been held to be unsustainable. 11. In the result, the impugned order is upheld and the appeal of Revenue is dismissed." 7. Since the facts of the issue under consideration are identical with the facts of the appeal pertaining to Assessment Year 2013-14 decided by the co-ordinate bench, following the said decision, we hold that the penalty levied under Section 271(1)(c) of the Act is liable to be cancelled in the instant cases since the additions have been made on estimated basis. Accordingly, we set-aside the orders passed by the Ld. CIT(A) in all the three years under consideration and direct the Assessing Officer to de ..... X X X X Extracts X X X X X X X X Extracts X X X X
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