Vaibhav Dipak Shah vs. ACIT

Parties Involved

Facts Summary

The assessee, Vaibhav Dipak Shah, an individual and proprietor of M/s Leo Gems, engaged in the business of import and export of precious stones/diamonds, filed appeals against the orders of the Commissioner of Income Tax (Appeals)-48, Mumbai for Assessment Years 2009-10, 2010-11, and 2011-12. The primary issue was the levy of penalty under section 271(1)(c) of the Income Tax Act, 1961, by the Assessing Officer (AO) for additions made on an estimation basis. The assessee argued that since the additions were made on estimation, no penalty could be levied. The Tribunal, after hearing both parties and reviewing the material on record, confirmed the decision of the Commissioner of Income Tax (Appeals) that the penalty was not sustainable as the additions were made on an estimation basis.…

Legal Issues

• 1. Levy of penalty under section 271(1)(c) for additions made on estimation basis.

Judgment Outcome

Decided in favour of Assessee.

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