MAHADEV PANDURANG LOTKAR,,NAVI MUMBAI vs. INCOME-TAX OFFICER, WARD - 1,, LATUR

This appeal by the assessee against the order dated 07-03-2019 passed by the Commissioner of Income Tax (Appeals), Aurangabad-2, [„CIT(A)‟] for assessment year 2010-11.

We find no representation on behalf of the assessee nor any application filed seeking adjournment. The assessee called absent and set ex-parte. Therefore, we proceed to hear the Ld. DR and pass order on the basis of material evidence on record.

The assessee has raised three grounds of appeal, amongst which the only issue emanates for our consideration is as to whether the ld. CIT(A) is justified in confirming the penalty of Rs.66,000/- levied u/s 271(1)(c) of the Income-tax Act, 1961 (hereinafter referred to as „the Act‟).

Heard the ld. DR and perused the material available on record. We note that the assessee originally filed return of income declaring a total income of Rs.5,16,930/- and it was processed u/s 143(1) of the Act vide intimation dated 30.06.2011. The assessee accepting the hawala purchases filed revised return of income by adding Rs.3,39,897/- totaling to Rs.7,47,603/- on 15.03.2013. The AO accepted the same vide its order dated 27.12.2016 passed u/s 143(3) r.w.s. 147 of the Act. The ld. CIT(A) confirmed the same. We note that in similar type of cases, this Tribunal remanded the matter to the file of AO to determine the profits on such hawala purchases which were accepted by the Revenue. If that is so, the initiation of penalty proceedings for furnishing of inaccurate particulars of income by the AO is not maintainable for the reason that there was no furnishing of inaccurate particulars as it was only came to the information of AO by Sales Tax / VAT Department through DGIT(Inv), Mumbai. Therefore, in our opinion, penalty imposed by the AO and as confirmed by the ld. CIT(A) for furnishing of inaccurate particulars is not justified. Thus, penalty imposed by the AO and as confirmed by the ld. CIT(A) is cancelled. Thus, the grounds of appeal raised by the assessee are allowed.

In the result, appeal of assessee is allowed.