ASST. CIT - 32(1), MUMBAI vs. SHRI VIJAY BHOGILAL SHAH, MUMBAI

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ITA 106/MUM/2021Status: DisposedITAT Mumbai25 October 2021AY 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 held that the penalty was not sustainable as the additions were merely estimated and the Assessing Officer failed to prove concealment of income or furnishing of inaccurate particulars.

What were the facts?

The Revenue appealed against the deletion of penalty imposed under Section 271(1)(c) by the CIT(A). The penalty was levied due to additions made on account of alleged bogus purchases during assessment.

What were the issues?

Whether penalty under Section 271(1)(c) is sustainable on estimated additions when concealment of income or furnishing of inaccurate particulars is not conclusively proved.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(2)Show list

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Income Tax Appellate Tribunal, “F” BENCH, MUMBAI

Before: HON’BLE SHRI SAKTIJIT DEY, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM

For Respondent: Shri S. N. Kabra- Ld. Sr. DR

Manoj Kumar Aggarwal (Accountant Member)

1.

Aforesaid appeal by revenue for Assessment Year [AY] 2009-10 arises out of the order of Ld. Commissioner of Income-Tax (Appeals)-44, Mumbai [CIT(A)] dated 31/08/2020 which has deleted the penalty of Rs.7.99 Lacs u/s 271(1)(c) as levied by Ld. AO vide penalty order dated 27/03/2018. At the time of hearing, none appeared for assessee. The Ld. DR, on the other hand, pleaded for restoration of penalty.

2.

Facts leading to imposition of penalty are that in an assessment framed u/s 143(3) r.w.s. 147 on 26/02/2015, the assessee was saddled with addition of alleged bogus purchases on estimated basis at the rate of 12.5% which was confirmed by Ld. CIT(A). Consequently, penalty of Rs.7.99 Lacs was imposed by Ld. AO vide order dated 27/03/2018. However, upon further appeal, Ld. CIT(A) deleted the penalty, inter-alia, on the ground that the additions were estimated additions and Ld AO conclusively failed to establish that the purchases were bogus. The Ld. AO could not prove furnishing of inaccurate particulars of income or concealment of income and therefore, penalty on estimated additions would not be sustainable in terms of decision of Hon’ble Punjab & Haryana High Court in Harigopal Singh V/s CIT (258 ITR 85). Finally, the penalty was deleted which is in further appeal before us.

3.

In our considered opinion, the penalty is not sustainable since the additions are mere estimated additions of unproved purchases and therefore, no case of concealment of income or furnishing of inaccurate particulars of income could be made out against the assessee. Our aforesaid view is duly supported by the order of Hon’ble Chhattisgarh High Court in CIT V/s Vijay Kumar Jain (325 ITR 378; 19/04/2010) as well as the cited decision of Hon’ble Punjab & Haryana High Court. Therefore, we do not find any reason to interfere in the impugned order.

4.

Resultantly, the appeal stand dismissed. Order pronounced on 25th October, 2021. (Saktijit Dey) (Manoj Kumar Aggarwal) न्याययक सदस्य / Judicial Member लेखा सदस्य / Accountant Member मुंबई Mumbai; यदनांक Dated : 25/10/2021 Sr.PS, Dhananjay

आदेशकीप्रधिधलधपअग्रेधर्ि/Copy of the Order forwarded to : 1. अपीलाथी/ The Appellant 2. प्रत्यथी/ The Respondent आयकरआयुक्त(अपील) / The CIT(A) 3. 4. आयकरआयुक्त/ CIT– concerned 5. यवभागीयप्रयतयनयध, आयकरअपीलीयअयधकरण, मुंबई/ DR, ITAT, Mumbai 6. गार्डफाईल / Guard File

आदेशाि सार/ BY ORDER,

उप/सहायक पुंजीकार (Dy./Asstt.

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