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| The Tax Publishers2019 TaxPub(DT) 3916 (Mum-Trib) INCOME TAX ACT, 1961
Section 271(1)(c)
Where assessment was framed by AO after making ex-parte addition towards 100% of the bogus purchases which the co-ordinate bench of Tribunal in quantum proceedings reduced to 12.5% of such purchases, therefore, the penalty under section 271(1)(c) could not be imposed.
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Penalty under section 271(1)(c) - Addition of bogus purchases - Furnishing of inaccurate particulars of income -
AO made addition on account of bogus purchases. The penalty proceedings were also initiated for concealment of two particulars of income in the assessment order by issuing penalty notice under section 271(1)(c) which was not replied by assessee. CIT(A) affirmed the order of AO. Co-ordinate bench of Tribunal allowed the appeal of assessee in quantum by directing AO to apply a profit rate of 12.5% on the said bogus purchases. Held: Assessment was framed by AO after making ex-parte addition towards 100% of the bogus purchases which the co-ordinate bench of Tribunal in quantum proceedings reduced to 12.5% of such purchases. This a clear case where the income was estimated by applying a percentage of 12.5% and therefore, the penalty under section 271(1)(c) could not be imposed.
Relied:UOI v. Dharamendra Textile Processors (2008) 166 taxman.com 65 (SC) : 2007 TaxPub(DT) 1387 (SC), CIT v. Vegetable Products Ltd. (1973) 88 ITR 192 (SC) : 1973 TaxPub(DT) 0421 (SC)
REFERRED :
FAVOUR : In assessee's favour.
A.Y. :
IN THE ITAT, MUMBAI BENCH
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