9911796707
TMI Blog2024 (6) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... c) of the Act levied on additions made purely on estimation is not sustainable. Such a view has been taken by the Hon ble jurisdictional High Court in the case of CIT vs. Subhas Trading Co.[ 1995 (11) TMI 37 - GUJARAT HIGH COURT] , Navjivan Oil Mills[ 2001 (7) TMI 81 - GUJARAT HIGH COURT] AND Valimkbhai H. Patel [ 2005 (7) TMI 35 - GUJARAT HIGH COURT] Thus we hold that penalty u/s 271(1)(c) of the Act is not sustainable in the present case. - Shri Pawan Singh, Judicial Member And Shri Bijayananda Pruseth, Accountant Member For the Appellant : Shri Prakash Jhunjhunwala, CA For the Respondent : Shri J.K.Chandnani, Sr. DR ORDER PER BIJAYANANDA PRUSETH, AM: This appeal by the assessee emanates from the order of the Learned Commissioner of Inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s complete disclosure of all material facts on record, since the disputed purchase of traded goods had been recorded in audited books of accounts and exhaustive documentary documents to justify the genuineness of purchase had been filed on record; c) The payment is made through banking channel out of proven source. The appellant craves leave to add, amend, alter and/or withdraw any of the grounds of appeal at the time of hearing. 2. Facts in brief are that assessee is engaged in the business of trading in diamonds, bullion and related goods. The assessee filed his return of income for A.Y 2007-08 declaring total income at Rs. 3,46,513/- on 22.10.2007. Subsequently information was received from DGIT(Inv.), Mumbai vide letter dated 07.03.2014 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eration, which, in fact, are bogus. Accordingly, Rs. 13,55,01,536/- was added to the total income of assessee. Penalty proceedings u/s 271(1)(c) of the Act were separately initiated. 3. Aggrieved by this order of AO, assessee filed appeal before Ld.CIT(A). The Ld.CIT(A) partly allowed appeal of assessee and upheld the net profit of assessee @ 5%. The AO, thereafter, heard the assessee and levied penalty u/s 271(1)(c) of the Act on the addition confirmed by the Ld.CIT(A), which was Rs. 3,45,42,417/-. The addition was subsequently restricted to 5% of the bogus purchase of Rs. 13,55,01,536/- by the ITAT. In the result, addition of Rs. 67,75,076/- only survived. The Ld.CIT(A) has directed AO to levy penalty on addition of Rs. 67,05,076/-, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evied on such concealment of income. 6. We have heard both the parties and perused the materials on record. We have also gone through the decisions relied upon by the Ld.AR of the assessee. Undisputedly, the addition made on account of bogus purchases was partially confirmed by the Ld.CIT(A), which was subsequently reduced by the Tribunal. Initially, the AO added 100% of the disputed purchase, which was reduced to 5% of the total turnover by the Ld.CIT(A). On further appeal, the Tribunal further reduced it to 5% of the bogus purchase. In other words, AO made addition of Rs. 13,55,01,536/- which was restricted to Rs. 3,45,42,417/- by the Ld. CIT(A). It was further restricted to Rs. 67,75,076/- by the ITAT. 7. It is, therefore, clear that the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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