INCOME TAX OFFICER Vs. KAMAL ENGG. WORKS.

JUDGEMENT

(1.) THE department is aggrieved of the order dated 12 -4 -1985 of the learned Commissioner of Income Tax (Appeals). Bareilly whereby he cancelled the penalty of Rs. 11,658 levied by the Income Tax Officer u/s 271(1) (c) for the A. Y. 1978 -79.

(2.) THE assessed M/s Kamal Engineering Works, Civil Lines, Rampur carries on the business of manufacture of distillate plant and repair work. For the assessment year in question, the assessed declared an income of Rs. 22, 270 whereas assessment was completed by the Income Tax Officer on an income of Rs. 1,22,070 after making the following additions :

(3.) IN appeal the learned CIT (A) noticed that in the assessed's appeal only an addition of Rs. 27,552 on account of low gross profit had been sustained and that the Explanation of the assessed regarding the difference in the sales to M/S Lalji Mentha (P.) Ltd. was accepted. The learned CIT (A) held that the nature of the addition being related to estimates, the case did not call for the imposition of any penalty u/s 271(1) (c). Accordingly, he cancelled the penalty.