9911796707
|
Home
Issues:
Appeal against CIT(A) order for the assessment year 1988-89 on grounds of improper opportunity, nature of additions, penalty confirmation under section 271(1)(c), and reduction of penalty amount. Analysis: 1. The assessee appealed against the CIT(A) order citing lack of proper opportunity before penalty order and incorrect adjournment date set by the AO. The first ground was dismissed as not pressed during the hearing. 2. The main issue revolved around the penalty confirmation of Rs. 1,47,574 by the CIT(A) for unrecorded purchases. The AO alleged concealment of income based on unrecorded purchases, leading to the penalty imposition. 3. The assessee argued that no penalty should be levied as the final assessed income was at a loss. Citing relevant case laws, the assessee contended that penalty cannot be imposed when the final assessment results in a loss. 4. The Departmental Representative supported the penalty imposition, stating that the unrecorded purchases proved income concealment. However, the Tribunal noted that the penalty and assessment proceedings are distinct, and the penalty can only be levied if income is concealed without a plausible explanation. 5. The Tribunal observed that the amendment to Explanation 4 of section 271(1)(c) lacked clarity on penalty imposition in case of reduced losses before April 2003. Relying on precedents, including decisions by the Punjab and Haryana High Court and the Madras High Court, the Tribunal concluded that no penalty should be levied when the assessed income results in a loss. 6. Considering the precedents and the specific circumstances of the case, the Tribunal held that no penalty under section 271(1)(c) was applicable to the assessee due to the final assessed loss. Consequently, the penalty of Rs. 1,47,574 was deleted, and the appeal was partly allowed.
|
