ITO -22 (2) (1) , MUMBAI vs. MAGESHRAJA RAMRAJA NADAR, MUMBAI

As per the defect memo issued by the Registry, appeal is time barred by 506 days. The Ld.Departmental Representative (DR) submitted that the impugned order was passed by the CIT(A) on 28/02/2020, the department was required to file appeal within 60 days from the date of receipt of the CIT(A)’s order. On account of Covid-19 pandemic the office was working under restrictions / constraints, hence appeal was filed on 22/09/2021. The Hon’ble Supreme Court of India, taking cognizance of unprecedented condition caused by pandemic, vide judgement dated 23/03/2020 reported as 117 taxmann.com 66 extended period of limitation for filing of appeals. The present appeal has been filed by the revenue in the extended period of limitation; hence, there is no delay in filing of the present appeal.

We have heard the submissions of Ld.DR in respect of delay in filing of the appeal. We are satisfied that the delay in filing of the appeal has been caused for the bona fide reasons. The Hon’ble Apex Court, on its own motion took into consideration the hardship caused by the pandemic and has enlarged the period of filing of the appeals. This appeal has been filed by the revenue within the extended period. Thus, in the light of the aforesaid judgement of the Hon’ble Apex Court, there is no delay in filing of the present appeal.

Ms. Neha Thakur, representing the department submitted that the CIT(A) has deleted the penalty levied under section 271(1)(c) of the Act in respect of the additions made by the Assessing Officer on account of bogus purchases. The ld.DR pointed that the Assessing Officer made addition of 12.5% of the unproved purchases, the assessee challenged the addition before the CIT(A), where the same was confirmed by the CIT(A). Thereafter, the assessee did not challenge the finding of the CIT(A) before the Tribunal. The ld.DR submitted that once assessee has accepted the addition, the Assessing officer initiated penalty proceedings and levied penalty at 100% of tax sought to be evaded, i.e. Rs.30,900/-. The ld.DR submitted that the CIT(A) has erred in deleting the penalty. The ld.DR prayed for reversing the order of CIT(A) and upholding penalty order dated 29/09/2016.

We have heard the submissions made by the Ld. DR and have examined the orders of authorities below. The Assessing Officer levied penalty under section 271(1)(c) of the Act in respect of disallowance made on account of bogus purchases. A perusal of assessment order shows that the addition in respect of bogus purchases has been made merely on estimation basis. The CIT(A) has deleted the penalty by placing reliance on various decisions holding that penalty cannot be levied on estimated additions. We concur with the view of CIT(A), hence, the same is upheld and appeal of the Revenue is dismissed.

In the result, appeal filed by the Revenue is dismissed.