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TMI Blog2012 (9) TMI 795X X X X Extracts X X X X X X X X Extracts X X X X ..... ed them in the bank at the time of encashment. Further, in most of the cases, it has been encashed by sub-brokers which are verifiable by the bank itself. Thus, the explanation of the assessee cannot be brushed aside as it carries some probability looking to the fact that huge amount of commission paid has already been accepted. Also, AO has not carried out any enquiry or has brought any material on record to show that payments were bogus. The explanations offered by the assessee have not been found to be false. Therefore, penalty for concealment of the income u/s 271(1)(c), cannot be levied and same is deleted - Decided in favor of assessee - ITA No.7436/Mum/2010 - - - Dated:- 11-7-2012 - SHRI R.S.SYAL SHRI AMIT SHUKLA, JJ. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se cheques transactions. The partners submitted a list of persons to whom commissions were paid, incorporating the addresses of the same parties. The list of persons submitted by the assessee contained details of only 15 parties and on clarification sought by the Assessing Officer, it was submitted that the list of sub-brokers to whom payment was paid were not available and no confirmations could be submitted. The list of such sub-brokers to whom commission paid are given at page 3 of the assessment order as well as page 3 of the penalty order. The amount of commission paid to these sub-brokers aggregated to Rs.1,73,549/-. In absence of confirmation letters and addresses, the assessee offered this sum as income of the firm. This amount whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng penalty u/s 271(1)(c), which is evident from the abovementioned facts and circumstances of the case. Submission dated 10-06-2008: At the very outset we would like to humbly reiterate the fact that during the course of assessment proceedings for A.Y.2005-2006, neither there is any concealment nor furnishing of inaccurate particulars of income by the assessee so as to attract the initiation of the proposed penalty proceedings u/s. 2781(1)(c) of the Income Tax Act,1961. During the course of assessment your honour has made an addition of Rs.1,73,549/- being disallowance of commission paid by the assessee for non submission of confirmations by some of the parties as mentioned in the said assessment order. In this connection we would l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... empt to find out the whereabouts of such people by approaching the bank even after getting their bank details. Further, it was submitted that the assessee had chosen not to challenge the addition, solely to avoid litigation and to buy peace of mind and that no penalty proceedings should be initiated. However, the CIT(A), rejected the said contention of the assessee and after applying the decision of the Hon ble Supreme Court in the case of Union of India Ors. Vs. Dharmendra Textiles Processors, reported in (2008) 13 SCC 369, confirmed the penalty. 5. On behalf of the assessee, partner Shri Ranjeet Negi appeared in person and reiterated the submissions and explanation given before the Assessing Officer as well as CIT(A) and stated befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... does not give additional evidence or produce any new material, he still may rely upon the existing material and facts and based on such material give explanation to prove that he is not guilty of concealment of income or furnishing of inaccurate particulars. 6.1 From the perusal of the assessment order, it is seen that out of the payment of commission of Rs.35,65,096/-, only sum of Rs.1,73,549/- has been disallowed on the ground that addresses and confirmations could not be submitted. The main contention of the Assessing Officer was that the assessee has encashed the cheques, however, in the assessment order he has not clarified or quantified, what are the exact number of such cheques which has been directly encashed. On the other hand, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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