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TMI Blog2024 (12) TMI 983X X X X Extracts X X X X X X X X Extracts X X X X ..... e contention of the assessee that no penalty can be levied in the present case as the addition has been made purely on an estimated basis. As evident from the record, the assessee has been in complete defiance of various statutory requirements and also did not furnish the details as called for during the assessment proceedings. Thus, when necessary data, at least the income tax return, has not been filed by the assessee, despite opportunity even pursuant to notice issued under section 148 of the Act, the assessee cannot now take the plea that since the addition has been made by applying the net profit rate, no penalty can be levied in its case. Therefore, we are of the considered view that the decisions relied upon by the learned AR in support of the aforesaid plea are completely distinguishable on facts and thus, not applicable to the present case. Insofar as the contention of the learned AR that the assessee could not file the return of income due to failure on the part of its auditor, it is pertinent to note that under the provisions of section 139 of the Act, it is the responsibility of the assessee to file its return of income within the due date and same cannot be compared to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome Tax Act, 1961, for the reasons stated in the Impugned Order, without giving reasonable opportunity to the Appellant Company. The Impugned Order has been passed Ex-parte without considering the request for adjournment sought by the Appellant Company. 3. The Ld. Assessing Officer had passed the Impugned Order without stating the nature and amount of concealment of income in the show cause notice issued to the Appellant Company or even in the Impugned Order. 4. The Ld. CIT(A) had erred in not considering the fact produced by Appellant Company vide written submission dated 14th June, 2024 before passing the Impugned Order. 5. The Ld. CIT (A) and Ld. Assessing Officer has erred in not considering the fact that the entire amount of addition to the total income had been made on estimated basis which is purely a guess work of Assessing Officer and there is no wilful concealment of income. 6. The Ld. CIT (A) and Ld. Assessing Officer had erred in not considering the case laws submitted by Appellant Company before passing the Impugned Orders. 7. The Ld. CIT (A) and Ld. Assessing Officer had erred in not considering the fact that it is a settled law that the penalty under section 271(1)(c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs and was also requested to submit complete details of professional or technical fees or contract receipts party-wise received during the financial year and reconciled with the receipts appearing in Form 26AS for the assessment year 2011-12. However, despite ample opportunities, the assessee submitted only a few bills and vouchers of the expenditures claimed and failed to submit the name, address and PAN of the parties to whom the payment was made. Accordingly, in the absence of information, as called for, and on account of failure on the part of the assessee to prove the genuineness of the expenditure, the AO, vide order dated 26/12/2018 passed under section 143(3) r/w section 147 of the Act, assessed the total income of the assessee at Rs. 59,57,450. The learned CIT(A) granted partial relief to the assessee and directed the AO to apply a net profit rate of 20% on undisclosed receipts of Rs. 4,25,000. In further quantum appeal, the Tribunal vide its order dated 20/06/2023, passed in ITA No. 100/Mum./2023 granted further relief to the assessee and restricted the addition to 6% of gross receipts instead of the net profit rate of 20% applied by the learned CIT(A). 5. Meanwhile, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntial contract receipts and professional and technical fees, the assessee has not filed its return of income under section 139(1) of the Act. It is discernible from the record that even in response to the notice issued under section 148 of the Act, the assessee did not file its return of income. However, made partial compliance with the notices issued under section 142(1) of the Act. From the material available on record, we find that in the quantum proceedings, the addition was ultimately restricted to 6% of the gross receipts by the coordinate bench of the Tribunal. During the hearing, the learned Authorised Representative ( learned AR ) submitted that no penalty can be levied, in the present case, as the addition was made purely on an estimated basis. We find that similar contentions raised by the assessee were rejected by the learned CIT(A), by observing as under: 9. The only contention of the appellant is that no penalty can be levied when income is determined purely on an estimate basis. I do not agree with this contention of the appellant because such proposition is applicable only in situations where the assessee had filed original return of income and some minor defects we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 271(1)(c) of the Act further provides as follows: Explanation 3. Where any person fails, without reasonable cause, to furnish within the period specified in sub-section (1) of section 153 a return of his income which he is required to furnish under section 139 in respect of any assessment year commencing on or after the 1st day of April, 1989, and until the expiry of the period aforesaid, no notice has been issued to him under clause (i) of sub-section (1) of section 142 or section 148 and the Assessing Officer or the Commissioner (Appeals) is satisfied that in respect of such assessment year such person has taxable income, then, such person shall, for the purposes of clause (c) of this sub-section, be deemed to have concealed the particulars of his income in respect of such assessment year, notwithstanding that such person furnishes a return of his income at any time after the expiry of the period aforesaid in pursuance of a notice under section 148. 10. Therefore, from a careful perusal of the provisions of Explanation 3 to section 271(1)(c) of the Act, it is evident that in case any person fails, without reasonable cause, to file its return of income under section 139 within ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid plea are completely distinguishable on facts and thus, not applicable to the present case. 13. Insofar as the contention of the learned AR that the assessee could not file the return of income due to failure on the part of its auditor, it is pertinent to note that under the provisions of section 139 of the Act, it is the responsibility of the assessee to file its return of income within the due date and same cannot be compared to the filing of audit report under section 44AB of the Act, which specifically requires the accounts to be audited by an accountant and furnishing of such audit report in the prescribed form duly signed and verified by such accountant and setting forth such particulars as may be prescribed. Thus, we are of the considered view that even if due to the failure on the part of the auditor the assessee failed to file its audit report, as required under section 44AB of the Act, the same does not absolve the assessee from its responsibility to file the return of income under section 139 of the Act. At this stage, it is also pertinent to reiterate that the assessee also failed to file its return of income in pursuance of notice dated 30/03/2018 issued under secti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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