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TMI Blog2024 (11) TMI 157X X X X Extracts X X X X X X X X Extracts X X X X ..... the books of account, however, he initiated penalty proceedings, which means, part of the submission made by assessee has not been accepted by the AO, which in our view, is not permissible, since it is settled position that an admission made has to be accepted and acted as whole and not in parts. The reasoning on the basis of which, additions have been made in assessment proceedings may be good so far as framing of assessment is concerned. However, these reasonings on standalone basis are not enough for levying penalty u/s. 271(1)(c) of the Act. Thus penalty in the facts of present case is not leviable. Further, we observe that in this case the assessee has neither furnished inaccurate particulars of income nor concealed the particulars of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to file confirmation of the sundry creditors. Observing these two anomalies, the Assessing Officer vide order sheet entry dated 15.12.2017 asked the AR of the assessee to explain as to why books of account of the assessee could not be rejected. In response, the AR of the assessee agreed to rejection of books of account with a condition that no penalty proceedings would be initiated against the assessee. Thereafter, the Assessing Officer rejected the books of account of the assessee and computed the income of the assessee by applying gross profit rate of 8% and assessed the income of the assessee on estimate basis. The Assessing Officer also initiated penalty proceedings u/s. 271(1)(c) of the Act. So far as quantum of addition is conce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gs before the Assessing Officer has agreed that the books of account of the assessee may be rejected subject to non-initiation of penalty proceedings. We observe that the Assessing Officer has partly accepted the reply of the ld. AR of the assessee, as evident from the fact that he has rejected the books of account, however, he initiated penalty proceedings, which means, part of the submission made by the AR of assessee has not been accepted by the Assessing Officer, which in our view, is not permissible, since it is settled position that an admission made has to be accepted and acted as whole and not in parts. We further observe that it is settled position of law that penalty and assessment are separate proceedings. In penalty proceedings, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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