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Income Tax Appellate Tribunal, “B”, BENCH MUMBAI
Before: SHRI R.C.SHARMA, AM & SHRI RAM LAL NEGI, JM
PER R.C.SHARMA (A.M.) : This is an appeal filed by the assessee against the order of CIT(A), Mumbai, dated 27-8-2012, for the assessment year 2006-07, in the matter of imposition of penalty u/s.271(1)(c) of the I.T. Act
Rival contentions have been heard and record perused. Facts in brief are that the assessee is engaged in the business of manufacturing of MS ingot and MS TMT bars. During the course of scrutiny assessment the AO made addition on account of purchases based on the statement made by third party amounting to Rs.14.45 crores, which was finally reduced to Rs.59.57 lakhs. The addition so retained was adhoc addition and were not as a result of any evidence of filing inaccurate particulars or concealing the income.
From the record we found that assessee has produced all the evidence to support the purchases, even the enquiries made during the assessment proceedings u/s.133(6) were properly confirmed. The books of accounts were duly audited and proper records were duly maintained by the assessee. We also found that the purchases were matched by corresponding sales. The final addition made on account of such purchases were not contested by the assessee to buy peace of mind and to avoid further litigation. Accordingly, the penalty levied with respect to the adhoc addition so retained was not justified. Ld. AR placed on record various orders of the Tribunal, wherein for such adhoc addition/disallowance of purchases, penalty so levied was deleted by the Tribunal in the cases of Chempure, 40 SOT 164, S.H.A.M.K. Distributors Pvt. Ltd., ITA No.2337/Mum/2010, order dated 31-5-2012 (33 CCH 002 Mum Trib and Harnish B. Shah, ITA Nos.1314 to 1316/Mum/2008 (126 TTJ 283). We had also gone through all these decision relied on by ld. AR, which are on the same facts. Applying the proposition of law laid down in these cases, we do not find any merit for the penalty imposed with respect to the adhoc additions retained on account of purchase.
In the result, appeal filed by the assessee is allowed. Order pronounced in the open court on this 10/02/2016 (RAM LAL NEGI) (R.C.SHARMA) न्यानयक सदस्य / JUDICIAL MEMBER ऱेखा सदस्य / ACCOUNTANT MEMBER भुंफई Mumbai; ददनांक Dated 10/02/2016 प्र.कु.मभ/pkm, नन.स/ PS आदेश की प्रनिलऱपप अग्रेपषि/Copy of the Order forwarded to : अऩीराथी / The Appellant 1. प्रत्मथी / The Respondent. 2. आमकय आमुक्त(अऩीर) / The CIT(A), Mumbai. 3. आमकय आमुक्त / CIT 4. ववबागीम प्रनतननधध, आमकय अऩीरीम अधधकयण, भुंफई / DR, ITAT, Mumbai 5. गार्ा पाईर / Guard file. 6. आदेशाि सार/ BY ORDER, सत्मावऩत प्रनत //// उप/सहायक पुंजीकार (Asstt.