ITAT Mumbai: No Penalty U/s 271(1)(c) on Estimated Bogus Purchase Additions

ITO Vs Vinipul Inorganics Private Limited (ITAT Mumbai) ITAT Mumbai: No Penalty u/s 271(1)(c) on Estimated Bogus Purchase Additions The Mumbai ITAT upheld deletion of penalty under Section 271(1)(c) where additions on account of bogus purchases were made purely on an estimated basis. In this case, although the AO initially added the entire amount of alleged bogus purchases, the Tribunal in quantum proceedings restricted the addition to 12.5%, treating it as an estimate of profit element. The Tribunal observed that when income is determined based on estimation rather than concrete evidence of c...