MR.M.K.BINDROO,MUMBAI vs. ITO 24 (2)(4), MUMBAI

In this appeal for Assessment Year (AY) 2012-13, the assessee is aggrieved by confirmation of penalty of Rs.1,55,766/- u/s 271(1)(c) by Ld. Commissioner of Income-Tax (Appeals)-36, Mumbai, [in short referred to as ‘CIT(A)’] vide impugned order dated 21/05/2018. The assessment for the year was framed by Ld. Assessing Officer (AO) u/s 143(3) on 27/03/2015 determining the income at Rs.16.41 Lacs as against returned income of Rs.10.89 Lacs.

During hearing, none appeared for assessee. However, the material on record was sufficient for disposal of the appeal. The Ld. DR pleaded for dismissal of the appeal.

Facts leading to levy of penalty are that the assessee is a dealer of Kashmiri Shawls and it reflected business loss of Rs.4.90 Lacs. However, since no supporting evidences were furnished towards claim of expenditure, the loss was disallowed and the income was computed on presumptive basis u/s 44AD. Consequently, the assessee was saddled with impugned penalty of Rs.1.55 Lacs u/s 271(1)(c) vide order dated 28/09/2015. The penalty, upon confirmation by Ld. CIT(A), is in further challenge before us.

After going through the factual matrix, we find that the assessee had furnished its revised computation of income and offered the income on presumptive basis @8% during assessment proceedings. The same has ultimately been accepted by Ld.AO. Under these circumstances, the penalty could not be levied as held by Amritsar Tribunal in M/s Roop Sons & Co. V/s ITO (ITA No.683/Asr/2013 dated 26/02/2014), the copy of which is on record. The bench, under identical factual matrix, noted that penalty would not be leviable since income was determined purely on estimation basis. We concur with the same and accordingly, delete the penalty as levied by Ld. AO.

The appeal stands allowed. Order pronounced on 02nd June, 2021. 3 (Manoj Kumar Aggarwal) (Mahavir Singh) लेखा दस्य / Accountant Member उपाध्यक्ष / Vice President मुिंबई Mumbai; सदनािंक Dated : 02/06/2021 Sr.PS, Jaisy Varghese आदेशकीप्रधिधलधपअग्रेधर्ि/Copy of the Order forwarded to : 1. अपीलाथी/ The Appellant 2. प्रत्यथी/ The Respondent 3. आयकरआयुक्त(अपील) / The CIT(A) आयकरआयुक्त/ CIT– concerned 4. सवभागीयप्रसतसनसध, आयकरअपीलीयअसधकरण, मुिंबई/ DR, ITAT, Mumbai 5. 6. गार्डफाईल / Guard File