IN INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH AHMEDABAD BEFORE, SHRI S. S. GODARA, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER. ITA. 1284/Ahd/2007 (Assessment Year:1998-99) Shri Devrajbhai Laljibhai Prajapati Prop. of M/s. Shri Laxmi Roadlines & Transport Services, Road No.5, Udhna Udyognagar, Udhna, Surat. Appellant Vs. Income-tax Officer, Ward 2(1), Surat Respondent PAN: AFLPP5423Q By Assessee : Shri J. P. Shah, A.R. By Revenue : Shri S. L. Chandel, Sr. D.R. Date of Hearing : 09.09.2016 Date of Pronouncement : 30.09.2016 ORDER PER S. S. GODARA, JUDICIAL MEMBER This assessee s appeal for assessment year 1998-99 arises against CIT(A)-II, Surat s order dated 15.11.2006 in case no. CAS/II/54/05-06 affirming penalty of Rs.4,03,760/-, in proceedings u/s.271(1)(c) of Income Tax Act, 1961; in short Act . 2. We notice at outset that impugned Section 271(1)(c) penalty of Rs.4,03,760/- arises from three quantum additions of commission income ITA No.1284/Ahd/2007 (Shri Devrajbhai L. Prajapati vs. ITO) A.Y. 1998-99 -2- from transport business, income from transport business and income disclosed during survey operation of Rs.2,57,200/-, Rs.72,000/- & Rs.11lacs; respectively. Ld. counsel representing assessee files before us copy of hon ble jurisdictional high court s judgment in Tax Appeal No.419/Ahd/2007 decided on 21.07.2016 deleting last quantum addition. Ld. Departmental Representative fails to rebut this factual position. We thus hold that impugned pertaining to last quantum addition has no legs to stand. same is accordingly deleted. 3. We now come to impugned penalty pertaining to former two quantum additions of commission income from transport business and income from transport business. CIT(A) in paras 3.2 & 3.2 onwards holds that departmental authorities had conducted survey in assessee s case. He stated to have received commissions of Rs.300/- to 4000/- per truck. revenue authorities in quantum proceedings proceeded to adopt estimation method by taking hiring charges per truck as Rs.8000/-, divided total receipts of Rs.54,46,445/- after reducing higher charges of owned trucks as indicated by bank accounts thereby determining total number of trips 668. Assessing Officer then multiplied this figure to Rs.400/- per trip commission amount and computed total figure of Rs.2,67,200/-. He thereafter allowed expenses of Rs.10,000/- to arrive at net commission income of Rs.2,57,600/-. 4. We proceed further and come to income from transport business of Rs.72000/-. This case file indicates that Assessing Officer estimated net income from each truck at Rs.24000/- since assessee was unable to furnish any details of hire charges. Both lower authorities penalized assessee qua these two incomes u/s.271(1)(c) of Act. ITA No.1284/Ahd/2007 (Shri Devrajbhai L. Prajapati vs. ITO) A.Y. 1998-99 -3- 5. Heard both sides reiterating their respective stands in course of hearing. There is no dispute in above narrated facts that authorities below have not been pointed any specific evidence of assessee having actually derived impugned income. They merely proceed on assumption and presumption to end up in adopting estimation method to determine impugned income. law regarding penalty proceedings stands very well settled by now that same are parallel to quantum proceedings and each and every disallowance/addition does not necessarily resulting imposition of Section 271(1)(c) penalty. We quote hon ble apex court s decision in Reliance Petro Products case 322 ITR 158(SC) in support. We reiterate at cost of repetition that it is survey case wherein no actual evidence of any such income has been brought on record. assessee s argument succeeds accordingly. 6. assessee s appeal is allowed. [Pronounced in open Court on this 30th day of September, 2016. Sd/- Sd/- (MANISH BORAD) (S. S. GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad: Dated 30/09/2016 True Copy S.K.SINHA Copy of Order Forwarded to:- 1. Revenue 2. Assessee 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Ahmedabad 6. Guard file. By order Devrajbhai Laljibhai Prajapati v. Income-tax Officer, Ward 2(1), Surat