Mere Non-response from creditors cannot be treated as furnishing of inaccurate particulars of income
Case Law Details
Royal Rubber Works Vs ITO (ITAT Delhi)
Undisputedly, the addition based on which the Assessing Officer imposed penalty under section 271(1)(c) of the Act was on account of sundry creditors. While deciding the quantum appeal of the assessee, the Tribunal has deleted the major part of the addition, accepting assessee’s submission that such amount was not credited in the books of account during the year. Addition of Rs.3,43,289/- was sustained only on the ground that it was credited to the books of account during the year.
Before us, learned counsel for the assessee has submitted that the Assessing Officer has accepted the sales and purchases. He has further submitted that subsequently the amount was repaid. Thus, considering the quantum of addition sustained by the Tribunal and also the fact that assessee has paid back the amount to the creditors, we are of the view that the assessee cannot be accused of furnishing inaccurate particulars of income. Merely because no reply was received from the creditors, it cannot be presumed that they are non-genuine. Accordingly, we delete the penalty imposed under section 271(1)(c) of the Act.
Mere Non-response from creditors cannot be treated as furnishing of inaccurate particulars of income
FULL TEXT OF THE ORDER OF ITAT DELHI
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