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TMI Blog2020 (7) TMI 432X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee in the present case is a private limited company and engaged in the business of timber trading. There was the survey operation carried out at the premises of the assessee under section 133A of the Act. As a result of survey, certain documents of incriminating nature were found. Accordingly the income of the assessee was estimated at the rate of 7% based on such incriminating documents which resulted in the addition of Rs. 16,98,943/- to the total income of the assessee. Thus the assessment was framed under section 143(3) read with section 147 of the Act, vide order dated 29-12-2008 after making the impugned addition to the total income of the assessee. The AO simultaneously issued notice under section 274 read with section 271(1)(c) of the Act, for initiating the penalty which was confirmed at Rs. 6,71,930/- being 100% of the amount of tax sought to be evaded. 5. Aggrieved assessee preferred an appeal to the learned CIT (A) who also confirmed the order of the AO. 6. Being aggrieved by the order of the learned CIT (A), the assessee is in appeal before us. 7. The learned AR before us submitted that the addition has been made on estimated basis. Therefore there cannot be any p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... positive finding as to whether there was concealment of income by the assessee or whether any inaccurate particulars of such income had been furnished by them. If no such clear cut finding is reached by the authority, penalty cannot be levied. It was a case in which in final conclusion the authority had recorded that "I am of the opinion that it will have to be said that the assessee had concealed its income and/or that it had furnished inaccurate particulars of such income." It was in this respect the Bench observed that "Now the language of "and/or" may be proper in issuing a notice as to penalty order or framing of charge in a criminal case or a quasicriminal case, but it was incumbent upon the IAC to come to a positive finding as to whether there was concealment of income by the assessee or whether any inaccurate particulars of such income had been furnished by the assessee.No such clear cut finding was reached by the IAC and, on that ground alone, the order of penalty passed by the IAC was liable to be struck down." The principles laid down by the Hon'ble Jurisdictional High Court in the above case are squarely applicable to the facts of the case on hand. The AO has not ment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 271(1)(c)/274 of the Act proposing the penalty on the amount of the addition confirmed by the ITAT. The assessee in response to such notice replied that the addition has been made on estimated basis, therefore there cannot be any penalty. However, the AO disregarded the contention of the assessee and levied the penalty of Rs. 40,90,779.00 being 100% of the amount of tax sought to be evaded. 17. Aggrieved assessee preferred an appeal to the learned CIT (A) who confirmed the order of the AO. 18. Being aggrieved by the order of the learned CIT (A) the assessee is in appeal before us. 19. The learned AR before us contended that there cannot be any penalty for the concealment of income on the addition made on estimated basis. 20. On the other hand the learned DR vehemently supported the order of the authorities below. 21. We have heard the rival contentions of both the parties and perused the materials available on record. Admittedly, the addition was made on estimated basis. Therefore in our considered view there cannot be any penalty qua to the addition made on estimated basis. In holding so we draw support and guidance from the judgment of Hon'ble Gujarat High Court in the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, and on account of strict enforcement of health advisories with a view of checking spread of Covid 19. The epidemic situation in Mumbai being grave, there was not much of a relaxation in subsequent lockdowns also. In any case, there was unprecedented disruption of judicial wok all over the country. As a matter of fact, it has been such an unprecedented situation, causing disruption in the functioning of judicial machinery, that Hon'ble Supreme Court of India, in an unprecedented order in the history of India and vide order dated 6.5.2020 read with order dated 23.3.2020, extended the limitation to exclude not only this lockdown period but also a few more days prior to, and after, the lockdown by observing that "In case the limitation has expired after 15.03.2020 then the period from 15.03.2020 till the date on which the lockdown is lifted in the jurisdictional area where the dispute lies or where the cause of action arises shall be extended for a period of 15 days after the lifting of lockdown". Hon'ble Bombay High Court, in an order dated 15th April 2020, has, besides extending the validity of all interim orders, has also observed that, "It is also clarified that while calculatin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dgment dated 15th April 2020, held that directed "while calculating the time for disposal of matters made time-bound by this Court, the period for which the order dated 26th March 2020 continues to operate shall be added and time shall stand extended accordingly". The extraordinary steps taken suo motu by Hon'ble jurisdictional High Court and Hon'ble Supreme Court also indicate that this period of lockdown cannot be treated as an ordinary period during which the normal time limits are to remain in force. In our considered view, even without the words "ordinarily", in the light of the above analysis of the legal position, the period during which lockout was in force is to excluded for the purpose of time limits set out in rule 34(5) of the Appellate Tribunal Rules, 1963. Viewed thus, the exception, to 90-day time-limit for pronouncement of orders, inherent in rule 34(5)(c), with respect to the pronouncement of orders within ninety days, clearly comes into play in the present case. Of course, there is no, and there cannot be any, bar on the discretion of the benches to refix the matters for clarifications because of considerable time lag between the point of time when the hearing is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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