SEWA DEVELOPERS PVT. LTD.,GHAZIABAD vs. DCIT, CIRCLE- 23(2), NEW DELHI

None appeared on behalf of the assessee despite issuance of notice on several occasions. Since sufficient opportunities were already given to the assessee , we deem it fit to dispose of this appeal on hearing the ld. DR and based on materials available on record.

The only effective issue to be decided in this appeal is as to whether the ld. CIT(A) was justified in confirming the levy of penalty on an adhoc addition.

We have heard the ld. DR and based on materials available on record. The return of income for the Asst Year 2012-13 was filed by the assessee company on 22.8.2012 declaring loss of Rs 43,66,099/-. The ld. AO in the scrutiny assessment proceedings observed that in response to the questionnaire issued by him, the authorized representative of the assessee company had furnished only part details and that there was no full compliance from the side of the assessee. The ld. AO observed that during the year under consideration, there was considerable increase in administrative expenditure of the assessee company when compared to that in the immediately preceding year. The assessee furnished a reply before the ld. AO that most of the documents were lost for which a complaint was filed with the police authorities. The ld. AO ignored the submissions and proceeded to make adhoc disallowance of expenditure of Rs 48,61,381/- in the assessment. Similarly, there was a fresh receipt of unsecured loan of Rs 11,29,271/- during the year under consideration, for which the assessee did not furnish any details. Accordingly, the same was added by the ld. AO treating the said loan as unexplained cash credit u/s 68 of the Act. Penalty u/s 271(1)(c ) of the Act stood levied subsequently by the ld. AO in the sum of Rs 18,51,111/- on the aforesaid two additions by observing that both the additions had been accepted by the assessee by not preferring any appeal before the ld. CIT(A). This action of the ld. AO was upheld by the ld. CIT(A). But we find that the assessee vide Ground No.2 had stated that some of the additions were deleted by the ld. CIT(A) in quantum proceedings and that only one addition got ultimately sustained. No details in this regard were made available either by the assessee or by the ld. DR before us to state the fact as to which of the additions were deleted or sustained by the ld. CIT(A) in quantum proceedings. Both the lower authorities had categorically stated that no appeal has been preferred by the assessee against the quantum proceedings. Considering these facts, the bench is of the opinion that this matter requires factual verification at the end of the ld. AO.