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Penalty Deleted as Addition Was Based on Estimation
Case Law Details
- TaxGuru Citation
- 2026 taxguru.in 624
- Case Name
- ITO Vs Spark Diamonds (ITAT Mumbai)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Related Assessment Year
- 2007-08
- Courts
- All ITAT, ITAT Mumbai
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ITO Vs Spark Diamonds (ITAT Mumbai)
ITAT Mumbai Deletes Penalty on Estimated Bogus Purchase Addition; Revenue Appeal Dismissed
The Mumbai Bench of the Income Tax Appellate Tribunal dismissed the Revenue’s appeal in the case of Spark Diamonds for AY 2007–08, thereby upholding the order of the CIT(A) which had deleted the penalty levied under Section 271(1)(c).
During the assessment, the Assessing Officer had made an estimated addition of 6% (₹1.35 lakh) on alleged bogus purchases of ₹22.61 lakh, and consequently levied a penalty of ₹41,940 (100% of tax sought to be ev...
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