Penalty u/s 271(1)(c) Not Sustainable on Estimated GP Addition: ITAT Pune

M. M. Brothers Vs ITO (ITAT Pune) Penalty u/s 271(1)(c) Not Sustainable on Estimated GP Addition – ITAT Pune Deletes Rs 5.41 Lakh Penalty The ITAT Pune allowed the assessee’s appeal & deleted penalty levied u/s 271(1)(c), holding that penalty cannot be imposed where quantum addition is made purely on estimation basis. In the quantum proceedings, the CIT(A) had directed estimation of gross profit @2.25% instead of sustaining bogus purchase addition, and penalty was later levied on such estimated income. Relying on Bombay High Court judgment in PCIT vs. Colo Colour Pvt. Ltd., the Tribuna...