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TMI Blog2016 (8) TMI 1486X X X X Extracts X X X X X X X X Extracts X X X X ..... e quantum addition is deleted, there remains no basis at all for levying the penalty for concealment or furnishing inaccurate particulars. The penalty cannot stand on its legs, thus, the appeal of the Revenue is dismissed. The stand of the Ld. Commissioner of Income Tax (Appeal) is affirmed. Appeal of the Revenue is dismissed. - ITA No. 6485/Mum/2014 - - - Dated:- 16-8-2016 - Shri Joginder Singh, Judicial Member And Shri Ashwani Taneja, Accountant Member For the Revenue : Shri Sunil Kumar Agarwal For the Assessee : Shri Arvind Sonde ORDER Per Joginder Singh (Judicial Member) The Revenue is aggrieved by the impugned order dated 23/07/2014 of the ld. First Appellate Authority, Mumbai, deleting penalty of ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hri S.K. Gupta, the AO proposed to disallow the said expenditure, treating the same to be bogus accommodation entries. Though the assessee contended that the payments were genuine and the professional services have been actually availed, yet the AO was not satisfied with the same. The AO noticed that identical expenditure claimed by the assessee had been disallowed in AY 2007-08. Hence, on identical reasoning, he disallowed the professional charges paid to Shri S.K.Gupta. The Ld CIT(A) also confirmed the same. 7. The Ld A.R submitted that the assessing officer has made the disallowance on the basis of the statement given by Shri S.K.Gupta on 12/12/2006 and 23/12/2006 during the course of search. However, shri Gupta has retracted from th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by him during the course of search operations conducted at his premises at Delhi. The statements given in December, 2006 has been stated to have been retracted by Shri S.K.Gupta by filing an affidavit on 05-02-2007. It is stated that subsequently another statement was taken from him on 08-02-2007 and in that Statement; Shri S.K.Gupta has reiterated the contents of affidavit and has categorically stated that he and his group of companies have rendered the services to the assessee herein. He has further stated that he has not referred to the name of M/s Reliance Industries Ltd in the original statements also, meaning thereby, he has stated that the assessee herein has not obtained any accommodation bogus bills from him. Before the tax author ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rlier, the assessing officer has not made any independent enquiry with Shri S.K. Gupta, particularly in view of the fact that the above said person has categorically stated that he had actually provided professional services to the assessee herein and he did not refer the name of the assessee herein in his original statement at all as one of the parties who had obtained accommodation bills from him. We also notice that the assessee herein was not provided opportunity of cross examining Shri S.K.Gupta, when the AO is placing reliance on the original statements given by him. 11. The Ld A.R placed reliance on the decision rendered by coordinate bench of Tribunal in the case of M/s Link Engineers Pvt Ltd (supra). In the above said case also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... S.K. Gupta has in a certificate retracted from the statement recorded during the search and he had denied everything stated in relation to the accommodation entries being provided to the assessee. The AO has not rebutted the certificate of Shri S.K. Gupta during the appellate proceedings. The Ld CIT(A) appreciated these legal propositions and also examined the types of professional services provided by Shri S.K. Gupta to the above said assessee. The Ld CIT(A) also noticed that the companies which issued bill for professional charges had actually employed technical people. Under these set of facts, the Ld CIT(A), in the above cited case, came to the conclusion that the assessee s claim of payment of professional charges to be genuine. H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te this addition. 2.2. In the aforesaid order, the Tribunal held that the Assessing Officer was not justified in making the disallowance of profession fee paid to Shri S.K. Gupta and the Ld. Commissioner of Income Tax (Appeal) in confirming the same. In view of this factual matrix, since the addition on the basis of which penalty was levied is no more surviving, therefore, penalty has to be deleted. Our view find support from the decision in K.C. Builders vs ACIT (2004) 265 ITR 562 (SC) and the ratio laid down in CIT vs S.P. Viz, 176 ITR 76 (Patna). Even otherwise, when the quantum addition is deleted, there remains no basis at all for levying the penalty for concealment or furnishing inaccurate particulars. The penalty cannot stand on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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