MR. ROSHANLAL GEHRILAL JOSHI,MUMBAI vs. ITO-WARD 33(3)(2), MUMBAI

Coming to the assessee’s sole substantive grievance seeking to delete sec.271(1)(c) penalty of Rs.6,80,360/-; it transpires with the able assistance coming from both the parties that the same pertains to quantum addition of Rs.28,34,537/- representing estimated undisclosed income @ 15% of the corresponding cash payments made to farmers amounting to Rs.1,88,96,917/- which has admittedly attained finality; the Assessing Officer concludes this an instance of furnishing of inaccurate particulars of taxable income. The CIT(A)-NFAC has confirmed the impugned penalty in very terms.

Both the parties reiterated their respective stands against and in support of the impugned penalty. The Revenue, more particularly, submitted that we ought to confirm the impugned penalty even the case that assessee has been found to have committed the default in issue u/sec.271(1)(c) of the Act. We note in this factual backdrop that the foregoing quantum addition was itself made on estimate basis than based on any cogent material in the assessee’s records indicating him either to have concealed or 3 ITA.No.4166/MUM./2023 furnished inaccurate particulars of taxable income. Faced with this situation, we quote CIT vs. Reliance Petro Products [2010] 322 ITR 158 (SC) wherein their lordships’ have settled the law that each and every quantum disallowance(s)/addition(s) does not attract the impugned penalty, since both are parallel proceedings in nature. We, therefore, delete the impugned penalty in very terms. Ordered accordingly.

This assessee’s appeal is allowed in above terms.