Section 271(1)(c) Penalty unustified on Ad-Hoc Estimated Income: ITAT Mumbai

ITO Vs Ashok Industrial Corporation (ITAT Mumbai) Income Tax Appellate Tribunal (ITAT) Mumbai dismissed the Revenue’s appeal against the order of the National Faceless Appeal Centre (NFAC), which had deleted the penalty levied under Section 271(1)(c) of the Income Tax Act, 1961. The penalty, amounting to ₹1,44,633, was imposed for the Assessment Year 2009-10 on the basis of an addition made for alleged bogus purchases. The CIT(A) had ruled that since the penalty was levied on an ad-hoc estimated income, it could not be sustained. The Revenue challenged this order, arguing that the assessee...