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TMI Blog2014 (6) TMI 370X X X X Extracts X X X X X X X X Extracts X X X X ..... lowance out of commission payments sustained by the Tribunal is merely by estimation of the excess amount of expenditure which the assessee might have been claimed by the assessee - disallowance has been made on the basis of the material furnished by the assessee itself – also in COMMISSIONER OF INCOME-TAX Versus RELIANCE PETROPRODUCTS PVT. LTD. [2010 (3) TMI 80 - SUPREME COURT] - every disallowance of an expenditure/exemption claimed by the assessee in the return cannot automatically lead to the conclusion that assessee has concealed the income or furnished inaccurate particulars of income – thus, the order of the CIT(A) is upheld – Decided against Assessee. - I.T.A. Nos. 152, 153, 154, 155 & 156/Hyd/2014 - - - Dated:- 28-5-2014 - Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment for the aforesaid assessment years the Assessing Officer disallowed 15% of the commission payment for A.Ys. 2001-02 and 2002-03, whereas he disallowed entire commission payments for A.Ys. 2000-01, 2003-04, 2004-05 and 2005-06. The assessee challenged the disallowance made in appeals preferred before the CIT(A). Being unsuccessful before the CIT(A), assessee approached the ITAT. The ITAT in a common order dated 25/0/2012 passed for all the aforesaid assessment years restricted the disallowance to 15% of the commission payments. Consequent upon the order passed by the ITAT sustaining disallowance of 15%, the Assessing Officer initiated proceeding for imposition of penalty u/s 271(1)(c) of the Act by issuing show cause notices to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , we are of the view that this is not a fit case for imposition of the penalty under S.271(1)(c) of the Act. Further, the impugned orders of the lower authorities proceed merely on the basis of the findings in the quantum proceedings and have not independently examined the matter in the penal proceedings for levy of penalty under S.271(1)(c) of the Act. Even on this procedural count, the penalty levied cannot be sustained. Though the addition was sustained at 15% of the commission payment by the Tribunal, that by itself does not prove that there is any conclusive material to suggest that the assessee has earned exactly that amount of profit, out of this disallowance determined by the Assessing Officer. Penalty cannot be levied in this kind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nces, as held by the Punjab and Haryana High Court in the case of Hargopal Sigh V/s. CIT(258 ITR 85), penalty cannot be levied. To levy penalty for concealment, it is necessary that there must be either concealment of income or furnishing of inaccurate particulars of its income by the assessee. As the Assessing Officer and the appellate authority arrived at different estimates of income of the assessee, it cannot be said that the assessee concealed particulars of income, so as to attract penalty. It was held by the Allahabad High Court in the case of CIT V/s. Raj Bans Singh (276 ITR 351), that when income is estimated by different authorities right from Assessing Officer to Tribunal and it was a simple case of one estimate against another e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing findings: 4.3 Since the issue involved in the five appeals being adjudicated now is identical, i.e., penalty has been imposed on the commission payments disallowance, the order of the honourable ITAT reproduced above is directly applicable. Respectfully following the aforementioned order, I hold that given the facts and circumstances penalty u/s 271(1)(c) is not leviable and the same is ordered to be cancelled for all the five appeals being adjudicated upon. 5. Being aggrieved, the department is before us. 6. At the outset, the learned AR submitted that the issue in appeal being squarely covered by the decision of the Tribunal in assessee s own case for AY 2005-06 which has been followed by the CIT(A), there is no infirmity i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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