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TMI Blog2020 (10) TMI 1146X X X X Extracts X X X X X X X X Extracts X X X X ..... estimation and not based on any concrete evidence. No clinching material has been brought on record by the revenue which could disprove the authenticity of the purchases claimed by the assessee to have been made from the aforementioned parties, no penalty u/s 271(1)(c) thus could have been validly imposed upon it. We thus not being able to find any infirmity in the view taken by the CIT(A), uphold the deletion of the penalty u/s 271(1)(c) by him. - Decided against revenue. - ITA Nos. 1298 & 1299/Mum/2019 - - - Dated:- 26-10-2020 - Shri Rajesh Kumar , Accountant Member And Shri Ravish Sood , Judicial Member Appellant by : Shri Michael Jerald , D. R Respondent by : None ORDER PER RAVISH SOOD , JM : The presen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t there was a definite finding in the assessment order in respect of bogus purchases and of furnishing inaccurate particulars of income relating to purchases resulting into concealment of income. 3. It is humbly requested that present appeal is being filed in accordance with the CBDT's Instruction No. 3/2018 dated 11/07/2018 amended vide letter dated 20.08.2018 as per para 10(e) of the said circular. Therefore, the order of the CIT(A) may kindly be vacated and that of the AO may be restored. 4. The appellant craves leave to add, amend, alter or delete any ground of appeal. 2. Briefly stated, the assessee firm which is engaged in the business of manufacturing of textile disperse dyes had filed its return of income for A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. Padmavati Trading Co. ₹ 67,210/- Total ₹ 5,23,864/- In order to verify the genuineness and veracity of the aforesaid purchase transactions, the A.O issued notices under Sec.133(6) to the abovementioned parties, which, however, were returned unserved by the postal authorities. Accordingly, the A.O directed the assessee to produce the sellers from whom the impugned purchases were claimed to have been made. However, the assessee failed to comply with the directions of the A.O. Being of the view that the assessee had failed to discharge the onus and therein prove the genuineness of the purchase trans ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Rule 25 of the Appellate Tribunal Rules, 1963 after hearing the appellant revenue and perusing the orders of the lower authorities. It was submitted by the ld. D.R that as the assessee had admittedly made bogus purchases, thus, the A.O had rightly imposed penalty under Sec. 271(1)(c). It was averred by the ld. D.R that the order of the CIT(A) vacating the penalty imposed by the A.O under Sec. 271(1)(c) may be set aside and that of the A.O be restored. 8. We have heard the authorized representatives for both the parties, perused the orders of the lower authorities and the material available on record. Admittedly, in the case before us the A.O had stamped the purchases aggregating to ₹ 5,23,864/- that were claimed by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner of Income Tax (A). The Commissioner of Income Tax (A) has rightly taken a view that no penalty can be imposed if the facts and circumstances are equally consistent with the hypothesis that the amount does not represent concealed income as with the hypothesis that it does. If the assessee gives an explanation which is unproved but not disproved, i.e. it is not accepted but circumstances do not lead to the reasonable and positive inference that the assessee‟s case is false. The view taken by the Tribunal is a reasonable and possible view. The appeal is without any substance. The same is dismissed in limine with no order as to costs. We are of the considered view that the assessee in the case before us had failed to substan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dence the authenticity of the claim of the assessee of having made purchases from the aforementioned parties, therefore, merely on the basis of the unproved claim of purchases no penalty under Sec. 271(1)(c) could have been validly imposed on the assessee. In fact, the restriction of the disallowance of entire purchases made by the A.O to 96% of the aggregate value of such purchases by the CIT(A), speaks for itself that the disallowance sustained in the hands of the assessee is merely backed by a process of estimation and not based on any concrete evidence. Accordingly, as in the case before us no clinching material has been brought on record by the revenue which could disprove the authenticity of the purchases claimed by the assessee to ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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