INCOME TAX ACT, 1961

Section 271(1)(c)

Penalty under SEC 271(1)(c) - Concealment or furnishing of inaccurate particulars - Profit computed by applying rate an turnover -

AO on the basis of the information received from Sales Tax Department, treated purchases from certain parties as non-genuine as assessee could not produce the parties and also could not establish movement of goods. However, AO estimated profit element from non-genuine purchases at 12.5% and brought to tax .Assessee accepted estimation of profit element from non-genuine purchases made by the assessing officer and no further appeals have been preferred. Subsequently, AO initiated penalty proceedings and levied penalty under section. 271(1)(c) on the ground that assessee has deliberately furnished inaccurate particulars of its income and concealed its income within the meaning of section 271(1)(c) r.w. Explanation 1 thereto. Held: Estimated rate of profit applied on turnover of assessee does not amount to concealment or furnishing inaccurate particulars. In the instant case AO had only estimated Gross Profit on alleged non-genuine purchases without there being any conclusive proof of concealment of income or furnishing inaccurate particulars of such income. Accordingly penalty under section 271(1)(c) could not be levied.

Relied:CIT V. Aero Traders Pvt. Ltd., [322 Itr 316]

REFERRED :

FAVOUR : In assessee's favour

A.Y. :

SUBSCRIBE FOR FULL CONTENT

OR Try Reload the Page