ITO-27(3)(1). MUMBAI, MUMBAI vs. SANJEEV HARSHUPRASAD MISHRA, MUMBAI

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ITA 5239/MUM/2026Status: DisposedITAT Mumbai31 August 2026AY 2009-103 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the deletion of the penalty, agreeing that the addition was made on an estimated basis and not on concrete evidence of concealment or inaccurate particulars. Reliance was placed on High Court and Supreme Court judgments.

What were the facts?

The Assessing Officer (AO) made an addition for alleged non-genuine purchases and levied a penalty. The Commissioner (Appeals) deleted the penalty, stating the addition was based on estimation and lacked categorical material for concealment.

What were the issues?

Whether penalty under Section 271(1)(c) can be levied when the addition is based on an estimated disallowance of purchases without specific evidence of concealment or furnishing inaccurate particulars.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCHES, MUMBAI

Before: HON’BLE NARENDER KUMAR CHOUDHRY & HON’BLE PRABHASH SHANKAR

For Appellant: Shri Fenil Bhatt, Ld. A.R, Shri Rajesh Sakhardnde
Pronounced: 31.08.2026

आदेश / ORDER

PER BENCH:

These appeals have been preferred by the Revenue against the common order dated 18.02.2026, impugned herein, passed by the National Faceless Appeal Centre/Ld. Commissioner of Income Tax (Appeals) (in short, “Ld. Commissioner”) u/s 250 of the Income Tax Act, 1961 (in short, “the Act”), for the A.Ys. 2009-10 to 2011-12.

ITA Nos. 5239, 5231 and 5210/MUM/2026 Sanjeev Harshuprasad Mishra

2.

As identical issues are involved in these appeals, the same were heard together and are being disposed of by this composite order by taking ITA No.5239/Mum/2026 as the lead case, the result whereof shall apply mutatis mutandis to the connected appeals.

3.

In the lead case, the AO, vide assessment order dated 30.03.2015 passed u/s 144 r.w.s. 147 of the Act, made an addition of Rs.27,43,243/-, being 25% of the alleged non-genuine purchases of Rs.1,09,72,973/-. Consequent thereto, the AO, vide penalty order dated 23.09.2015, levied penalty of Rs.9,18,009/- u/s 271(1)(c) of the Act.

4.

The Ld. Commissioner deleted the penalty, observing that the underlying addition was made on an estimated/ad-hoc basis and there was no categorical material establishing concealment of income or furnishing of inaccurate particulars. While doing so, reliance was placed upon PCIT v. Colo Colour (P.) Ltd. [2025] 178 taxmann.com 458 (Bom.) and CIT v. Reliance Petroproducts (P.) Ltd. [(2010) 322 ITR 158 (SC)].

5.

The Ld. DR supported the penalty levied by the AO and assailed the relief granted by the Ld. Commissioner.

6.

We have heard the parties and perused the material available on record. Admittedly, the addition forming the basis of penalty was made by estimating 25% of the alleged non-genuine purchases and was not founded upon any categorical finding of concealment or furnishing of inaccurate particulars.

7.

The Hon’ble Jurisdictional High Court in PCIT v. Colo Colour (P.) Ltd. (supra) has affirmed deletion of penalty u/s 271(1)(c) where the underlying addition was made on estimation of alleged non-genuine purchases. Further, the Hon’ble Supreme Court in CIT v. Reliance

ITA Nos. 5239, 5231 and 5210/MUM/2026 Sanjeev Harshuprasad Mishra

Petroproducts (P.) Ltd. (supra) has held that mere disallowance of a claim does not, by itself, attract penalty u/s 271(1)(c).

8.

Thus, considering the peculiar facts and respectfully following the aforesaid binding precedents, we find no infirmity in the order of the Ld. Commissioner deleting the penalty of Rs.9,18,009/-. Accordingly, ITA No.5239/Mum/2026 filed by the Revenue stands dismissed.

9.

In the result, all the appeals filed by the Revenue stand dismissed.

Order pronounced in the open court on 31.08.2026.

Sd/- Sd/- PRABHASH SHANKAR NARENDER KUMAR CHOUDHRY ACCOUNTANT MEMBER JUDICIAL MEMBER (Tarun Kushwaha) Sr. Private Secretary

Copy to: The Appellant The Respondent The CIT, Concerned, Mumbai The DR Concerned Bench

//True Copy// By Order

Dy/Asstt. Registrar, ITAT, Mumbai.

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