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TMI Blog2016 (2) TMI 166X X X X Extracts X X X X X X X X Extracts X X X X ..... g the appeal of the assessee - Decided in favour of assessee - I.T.A. No. 8760/Mum/2011 - - - Dated:- 7-1-2016 - SHRI JOGINDER SINGH, JM AND SHRI RAJESH KUMAR, AM For The Appellant : Shri Vishwas V. Mehendale For The Respondent : Respondent by : Shri Mavrya Pratap ORDER PER RAJESH KUMAR, A. M: This appeal by the assessee is directed against the order dated 12.10.2011 of Commissioner of Income Tax (Appeals)-2, Mumbai (hereinafter called as the CIT(A) ) for assessment year 2003-04.The assessee has raised following grounds of appeal: ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW 1. The learned CIT (A) erred in confirming the Penalty u/s 271(1)(c) of ₹ 45633/- on the facts and circumstances ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to M/s. Punit Agency. The ld. AO issued a notice u/s 133(6) to Punit Agency and in reply to the said notice stated that a sum of ₹ 28,949/- was due from assessee as on 31.03.2003 and not ₹ 1,53,119/- as claimed by the assessee and added ₹ 1,24,170/- u/s 41(1)(a) of the Act by holding that difference between the confirmation from M/s. Punit Agency and in the books of assessee represented the cessation of liability and hence considered as the income in the hands of the assessee. The ld. AO imposed the penalty of ₹ 45,633/- on the ground that the assessee had concealed particulars of its income by overstating its liability. 3. The ld. CIT(A) confirmed the order of the AO by observing as under:- After exami ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rgued that the penalty could not even be imposed in that case. The ld. AR defended the case of the assessee while relying on the decision of the Gujrat High Court in case of CIT Vs. Bhogilal Ramjibhai Atara 43 taxmann.com55(Gujrat). The ld. DR relied on the order of the authorities below. 5. We have heard the rival submissions and perused the material on record. On the basis of the facts before us, we find that there was a difference of ₹ 1,24,170/- which was added u/s 41(1)(a) of the Act. The difference had arisen between the confirmation as received by the AO and books of the assessee when the AO called for information u/s 133(6) of the Act. The AO added the said difference to the income of the assessee by holding that trading li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the statue being fulfilled. Additionally such cessation or remission has to be during the previous year relevant to the assessment year under consideration. In the instant case, both elements are missing. There was nothing on record to suggest that there was remission or cessation of liability that too during the previous year relevant to the assessment year 2007-08. It is undoubtedly a curious case. Even the liability itself seems under serious doubt. The assessing officer undertook the exercise to verify the records of the so called creditors. Many of them were not found at all in the given address. Some of them stated that they had no dealing with the assessee. In one or two cases, the response was that they had no dealing with the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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