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Case Law Details

Case Name : Samatbhai Malabhai Parmar Vs ITO (ITAT Rajkot)
Appeal Number : ITA No. 142/RJT/2018
Date of Judgement/Order : 02/06/2020
Related Assessment Year : 2013-14
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Samatbhai Malabhai Parmar Vs ITO (ITAT Rajkot)

It is a settled principle of law that where addition to assessee’s income is made on estimate basis penalty under section 271(1)(c) cannot be imposed. The different judicial form has already decided in favour of the assessee on the identical issue, of such is passed in the case of Naresh Chand Agarwal vs. Commissioner of Income Tax by the Hon’ble Allahabad High Court. We have further gone through the written submission made before the authorities below by the appellant. It is on record that the addition was made on estimation of net profit @ 1.5% by the Ld. AO and hence we find there is no merit in levying penalty under section 271(1)(c) of the Act for the proposition already dealt with by us in the foregoing paragraph. Thus, in the absence of any merit in the order passed  by the authorities below we quash the same. The addition is therefore, deleted.

Lockdown Period Excluded from limitation of 90 Days for pronouncement of order

Issue under consideration is whether the period of lockdown will be excluded while computing the limitation provided under Rule 34(5) of the Income Tax (Appellate Tribunal) Rule 1963 for pronouncement of order by ITAT.

In the present case, ITAT was considering an order of the CIT(A) confirming penalty on estimate basis penalty under section 271(1)(c). While allowing the appeal filed by the assessee on the basis of settled provisions of the law, the Tribunal pointed out an issue whether when the hearing of the matter was concluded on 28.02.2020 the order can be pronounced on 28.05.2020 i.e. after 90 days.

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