RELIABLE METAL INDUSTRIES,MUMBAI vs. ACIT -25(3), MUMBAI

Aforesaid appeal by assessee for Assessment Year [in short referred to as ‘AY’] 2010-11 contest the order of Ld. Commissioner of Income-Tax (Appeals)-37, Mumbai, [in short referred to as ‘CIT(A)’], Appeal No. CIT(A)-37/IT-679/ACIT -25(3)/15-16 dated 18/11/2017 qua confirmation of certain penalty u/s 271(1)(c).

Upon perusal of quantum assessment order u/s 143(3) dated 23/12/2015, it transpires that the assessee has been saddled with 2 M/s. Reliable Metal Industries Assessment Year :2010-11 estimated addition of Rs.3.31 Lacs, being 25% of alleged bogus purchases. Against the same, penalty proceedings were initiated u/s 271(1)(c) in the quantum assessment order and the assessee has been saddled with penalty of Rs.1.02 Lacs by Ld. AO vide order dated 15/06/2016. 3. Subsequently, upon further appeal against quantum additions, the estimated additions were reduced to 12.5% by Ld. first appellate authority vide order dated 18/11/2017. Therefore, keeping in view the same, the Ld. first appellate authority, while adjudicating appeal against penalty, directed Ld. AO to reduce the penalty accordingly. Still aggrieved, the assessee is in further appeal before us.

After hearing rival submissions and perusal of relevant material on record, the undisputed position that emerges is the fact that the penalty has been levied / confirmed merely against estimated disallowances of 12.5%. Nevertheless, the assessee’s claim has been accepted substantially which do not suggest that there was furnishing of inaccurate particulars of income or concealment of income within the meaning of Section 271(1)(C). Therefore, the factual matrix does not inspire to concur with the stand of first appellate authority. Hence, we delete the impugned penalty.

The appeal stands allowed. Order pronounced in the open court on 22nd March, 2019. (Mahavir Singh) (Manoj Kumar Aggarwal) "ाियक सद" / Judicial Member लेखा सद" / Accountant Member मुंबई Mumbai; िदनांक Dated : 22/03/2019 Sr.PS, Jaisy Varghese