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2017 (11) TMI 1857 - ITAT MUMBAIPenalty u/s 271(1)(c) - Unexplained expenditure u/s. 69C - bogus purchases made by the assessee based on the information received from the Sales Tax Department - AO estimated the profit element on the purchases at 12.5% and reduced the Gross Profit already declared by the assessee - HELD THAT:- AO had made only adhoc estimation of profit on certain purchases treated as unexplained expenditure. Assessing Officer did not doubt the sales made by the assessee from out of such purchases. AO based on the decision in the case of CIT v. Simit P. Seth [2013 (10) TMI 1028 - GUJARAT HIGH COURT] estimated the profit element in such purchases at 12.5% and by reducing the Gross Profit already declared by the assessee. We hold that there is no concealment of income or furnishing of inaccurate particulars as the profit element was determined by way of adhoc estimation. Coming to the interest, the assessee furnished complete details in the return of income and made a claim and simply because the claim is denied and cannot lead to furnishing of inaccurate particulars or concealment of income. No allegation by Assessing Officer that the assessee failed to disclose the particulars relating to its claim in the return of income. Thus we hold that there is no concealment of income or furnishing of inaccurate particulars of income. Thus we direct the Assessing Officer to delete the penalty levied u/s. 271(1)(c) of the Act. - Decided in favour of assessee.
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