Pavan Kumar Gadale ORDER
Pavan Kumar Gadale, Member (J)
1. The revenue has filed the appeal against the order of the National Faceless Appeal Centre (NFAC), Delhi/CIT(A) passed u/sec 250 of the Act. The revenue has raised the fallowing grounds of appeal:
1. On the facts and in circumstances of the case and in law, the Ld. CIT(A) has erred in not considering that the penalty was levied in respect of the addition made on the basis of information received from the Sales Tax Department, Maharashtra with regard to bogus purchase made by the assessee from dealers without supply of actual goods.
2. On the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting the penalty by not appreciating the fact that the assessee could not substantiate the genuineness of purchases from the said parties during assessment proceedings as well as penalty proceedings.
3. It is respectfully submitted that the penalty was levied for the additions made on the basis of information received from Law enforcement agency of the State Government of Maharashtra i.e. Sale Tax Department.
4. It is humbly requested that present appeal is being filed in accordance with the CBDT's Instruction No. 3/2018 dated 11/07/2018 amended vide letter dated 20.08.2018 as per para 10(e) of the said circular. Therefore, the order of the CIT(A) may be vacated & that of the Assessing Officer may be restored.
5. The appellant craves leave to add, amend or alter any ground/grounds, which may be necessary.
2. The brief facts of the case are that the assessee is engaged in the business of reseller in chemicals & fuels. The assessee has filed the return of income for the A.Y. 2009-10 on 30.09.2009 disclosing a total income of Rs. 6,06,148/-.Subsequently the AO has received the information from Sales Tax Department, that the assessee has obtained bogus purchase bills from M/s. Neptune Corporation aggregating to Rs. 5,44,589/-.The Assessing Officer (AO) has reason to believe that the income has escaped assessment and issued notice u/s. 148 of the Act, in compliance the assessee has filed the revised return of income disclosing total income of Rs. 6,06,148/-,further the notice u/s. 143(2) and 142(1) of the Act are issued. In compliance, the Ld. AR of the assessee appeared from time to time and submitted the information and the case was discussed. Whereas, the AO has issued notice U/sec 133(6) of the Act on the party to examine the genuineness of the purchases but there was no response. The assessee has filed detailed letters on 26.03.2015 & 27.03.2015 with the supporting evidences. But the AO was not satisfied with the explanations and the information and finally made an addition of Rs. 5,44,589/- and assessed the total income of Rs. 11,50,740/- and passed the order u/s. 143(3) r.w.s. 147 of the Act dated 30.03.2015.
3. Subsequently, the AO has initiated the penalty proceedings u/s. 271(1)(c) of the Act. In the course of penalty proceedings it was brought to the knowledge of the Assessing officer that the assessee has filed an appeal with the CIT(A) on quantum addition of bogus purchases. Whereas, the CIT(A) has relied on the facts and judicial decisions and restricted the addition to the extent @ 25% of purchases and on further appeal the Honble Tribunal has restricted the addition to the extent of 12.5%. The A.O. has considered these facts and observed that none appeared on behalf of the assessee nor any explanations were filed in respect of penalty notice. The A.O. dealt on the facts and the findings of the scrutiny assessment and levied a penalty of Rs. 21,034/- and passed the order u/s. 271(1)(c) of the Act dated 21.03.2018.
4. Aggrieved by the penalty order, the assessee has filed an appeal with the CIT(A), the CIT(A) has considered the grounds of appeal, findings of the A.O. and the submissions of the assessee and observed that the A.O. has made addition of bogus purchases in the assessment U/sec 143(3) r.w.s. Sec. 147 of the Act. Furt........