No penalty u/s 271(1)(c) on Legal Heir for failing of AO to verify unexplained bank credits of deceased

Bhumika Navin Patel Vs ITO (ITAT Ahmedabad) Conclusion: Penalty under section 271(1)(c) was not leviable as deceased alone could have explained the source of the deposits, and since he had died before the initiation of penalty proceedings, it was not reasonable to expect the legal heir to establish his innocence. Addition to the income of the deceased assessee made on the basis of preponderance of probabilities was not justified. Held: Assessee, was the legal heir of the late Navinbhai Punjabhai Patel, a farmer. AO found cash and cheque/transfer credits in the deceased’s bank accounts for AY...