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TMI Blog2009 (11) TMI 891X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment proceedings which has been quoted in extenso in the impugned order, makes it clear that addition of the income was made only on the basis of estimate. Therefore, we do not find that the learned ITAT has recorded a wrong finding in this regard. As far as the finding with regard to concealment of income is concerned, it is clear that in the original assessment order, there was no finding that the assessee has concealed its income and furnished inaccurate particulars of income, but subsequently after the cancellation of the assessment, AO has proceeded on the basis that the assessee, while inflating the electricity charges and under-valuing the closing stock of rice bran, has suppressed the income. Therefore, the additions on acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and reasonable opportunity of being heard to the assessee. Thereupon, vide order dated 2-3-2006, the fresh assessment was completed at net taxable income of ₹ 92,76,557, after making addition of ₹ 57,74,857 on account of processing of unaccounted rice bran and ₹ 3,52,260 on account of under-valuation of closing stock of the rice bran. On second appeal by the assessee, the ITAT vide its order dated 30-3-2007 directed to apply the growth profit rate of 10 per cent and consequently, the income of the assessee was assessed at ₹ 51,13,637. It is specifically mentioned here that the ITAT had adopted the flat rate of 10 per cent for working out the unaccounted profits. Thus, the assessment was made on estimate basis. In t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court in the cases of Hari Gopal Singh v. CIT (258 ITR 85), CIT v. Rawail Singh Co. (254 ITR 191), CIT v. Dhillon Rice Mills (256 ITR 447) (Punj. Har.), CIT v. Metal Products of India (150 ITR 714) and Vishwakarma Inds. v. CIT (135 ITR 652) (Punj. Har.) (FB). Reliance can also be placed upon the decision of the Tribunal in Sudesh Khanna v. ACIT (2005) 98 TTJ (Ahd.) 106. Even while framing the original assessment, the assessee declared total income of ₹ 31,49,444 which was assessed at ₹ 31,53,943 and originally there is no finding that the assessee either concealed its income or furnished inaccurate particulars of income. For imposing penalty under section 271(1)(c), a definite finding about concealment is necessary. Howev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s under section 271(1)(c) of the Act were initiated by the Assessing Officer for furnishing the inaccurate particulars of income during the course of assessment proceedings? 4. Learned counsel for the appellant-revenue argued that in the instant case, the addition was made on the basis of estimate, but it was made on complete evidence based on documents found during the course of survey operation. He further submitted that in the assessment order, a definite finding with regard to concealment of income was recorded by the Assessing Officer, therefore, the ITAT is not justified in deleting the penalty, which was rightly imposed by the Assessing Officer. 5. After hearing learned counsel for the appellant-revenue and going through the im ..... X X X X Extracts X X X X X X X X Extracts X X X X
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