COMMISSIONER OF INCOME TAX Vs. WHITELINE CHEMICALS

JUDGEMENT

(1.) THE Revenue is in appeal against the judgment of the Income -tax Appellate Tribunal ("the Tribunal" for short) dated February 3, 2012 (Whiteline Chemicals v. ITO : [2013] 28 ITR (Trib) 523 (Ahd)), raising the following question for our consideration:

(2.) WITH respect to first aspect of the penalty, the Tribunal observed that no penalty can be imposed merely because the account books of the assessee were rejected and that the profit was estimated on the basis of the fair gross profit ratio. With respect to the retention of the portion of the sales tax, the Tribunal stated that no evidence was brought by the Revenue to suggest that the assessee had retained a portion of sales tax with it. The assessee filed its explanation which could not be termed as not bona fide. In the absence of any corroborative evidence to prove the charge that the portion of sales tax bill was retained by the assessee, penalty could not be imposed. From the above discussion, it can be seen that the opinion of the Tribunal with respect to the deletion of penalty is based on appreciation of evidence on record. With respect to the additions made after rejection of the book results and on the basis of the fair gross profit ratio, the Tribunal found no additional material to sustain the penalty. With respect to the so -called retention of the sales tax, the Tribunal found that the Revenue could not establish such charge. The explanation offered by the assessee could not be termed as not bona fide. We do not see any question of law arising. Tax appeal is, therefore, dismissed.