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TMI Blog2024 (5) TMI 1396X X X X Extracts X X X X X X X X Extracts X X X X ..... and in law, the Ld. CIT (A) has erred in restricting the penalty u/s 271(1)(c) of the 1.T.Act 1961, @ 12. 5% of bogus purchases of Rs 61 ,77,214/- on alleged purchases from 5 parties/entities?" 2. "Whether on the facts and Circumstances of the case and in law, the Ld. CIT (A) has erred restricting the penalty levied u/s 271(1)(c) of the I.T. Act, @ 12.5% on bogus purchases of Rs. 61 ,77,214/-, without considering the fact that AO has relied on information from the DGIT(Inv), Mumbai, who in turn had received information from the Sales-Tax Department Maharashtra,an external agency about Bogus Hawala Entry providers, involved in providing accommodation entries on non-genuine purchases and the assessee was found to be one of the beneficiary in taking entries of alleged purchases from 5 parties amounting to Rs. 61 ,77,214/-? 3. Whether on the facts and Circumstances of the case and in law, the Ld. CIT (A) has erred restricting the penalty levied u/s 271(1)(c) of the I.T. Act @ 12.5% on alleged purchases of Rs. 61 ,77,214/- without considering the fact that the assessee, when asked to prove the genuineness and creditworthiness of the transactions and parties /suppliers, has neither p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccurate particulars of income leading to concealment of income. 05. Against this assessment order the assessee preferred an appeal before the learned CIT (A), who restricted the addition to the extent of 12.5% instead of 100% by order dated 28th November, 2016. Therefore, the net addition remained of Rs. 7,72,152/-. 06. On this addition penalty proceedings proceeded. The assessee was issued show cause notice which was replied on 7th March, 2018, stating that addition as made on estimate basis and the assessee has not concealed any income or has disclosed inaccurate particulars which could lead to levy of penalty under Section 271(1)(c) of the Act. The learned Assessing Officer rejected the contention of the assessee passed the penalty order under Section 271(1)(c) of the Act on 28th March, 2018, holding that the assessee has furnished inaccurate particulars of income to the extent of Rs. 7,72,152/- and levied a minimum penalty of Rs. 2,38,595/-. 07. The assessee challenged the penalty order before the learned CIT (A). The learned CIT (A) passed an appellate order on 11th October, 2023, ex-parte as the opportunity given to the assessee on 5 occasions remained unanswered. However, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he learned Assessing Officer issued notices under Section 133(6) of the Act, which was returned as address was "not known" and the assessee failed to provide the new address. But despite this fact, assessee has produced all the information available with him of those parties when he purchased from them. Subsequently, such parties were suspected to be hawala dealers. The learned Assessing Officer made the addition and initiated the penalty proceedings holding that assessee has furnished inaccurate particulars income to the extent of 100% of bogus purchases. The learned CIT (A) restricted the same to the extent of 12.5% of bogus purchase. Neither the learned Assessing Officer nor the assessee challenged the determination of 12.5% of the profit before the higher forum. Therefore, it is apparent that the addition made in the hands of the assessee remains on estimated basis. Though it cannot be the case that whenever addition is made on the estimate basis penalty cannot be levied. However, when the assessee has furnished all the relevant information, what is the information that the assessee has furnished inaccurately is the question. It cannot be said that assessee was in known of thin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng 25% of purchases of Rs. 8,36,601" has held that :- "4. Learned Counsel for the appellant has drawn the attention of this Court to the decision of this Court in the case of Vijay Proteins Ltd. v. Commissioner of Income-tax reported in [2015] 58 taxmann.com 44 (Gujarat) and relevant paragraphs are reproduced as under :- "Insofar as T.A. No.243/2002 is concerned, the question of law raised therein is already concluded by a decision of this Court rendered in T.A. No.461/2000 & allied matters, as stated herein above. Paras 6 & 6.1 of the said decision are relevant for our purpose, which read thus. "6. Heard both the parties and gone through the material available on record. In the instant case, we are of the opinion that assessment made is just and proper. The statements made in the affidavits are not based on any record or corroborated with cogent evidence. The presumption raised by the papers which were seized from the custody of the appellant had not been rebutted. Therefore, the issues raised in appeals no. 461 to 464 of 2000 are required to be answered in the affirmative and against the assessee. 6.1 So far as the issue involved in appeals no. 833 to 836 of 2005 is conce ..... X X X X Extracts X X X X X X X X Extracts X X X X
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