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2017 (5) TMI 723 - ITAT AHMEDABADPenalty u/s. 271(1)(c) - valuation of the property - long term capital gains addition being re-computed by the Assessing Officer reducing assessee’s rate from ₹ 2050/- per sq.mtr. to ₹ 250/- per sq.mtr. only as on 01.04.1981 as modified in quantum lower appeal as well as in this tribunal - Held that:- There can hardly be any dispute about the settled law that quantum and penalty proceedings are separate wherein each and every addition made in course of former does not ipso facto result in levy of latter penal action. The Revenue’s argument that the assessee’s valuer intentionally did not highlight the fact of the land in question to be industrial is entirely misconceived as the said valuer makes it crystal clear at the bottom of the page that assessee’s land sold is situated in mixed commercial and industrial area. He thereafter certifies in the next page that there are no sale instances commensurating with the land sold on account of location, size, shape and other factors. This report very well considers all other advantageous factors of civic as well as industrial amenities to arrive at the valuation in question claimed at assessee’s behest. There is no dispute that the Assessing Officer thereafter reduced this valuation by citing sale instances of the relevant era i.e. in the years 1981 and 1982 to drastically reduce the assessee’s rate of ₹ 2050/- per sq.mtr. to ₹ 250/- only. The fact however remains that he has not considered even a single sale deed pertaining to any commercial or industrial plot as is the one involved in the instant lis. We further repeat that the said reduced rate stands enhanced to ₹ 550/- per sq.mtr. in quantum lower appeal and to that @Rs.980/- per sq.mtr. in this tribunal (supra). It is thus crystal clear that both the assessee as well as the Revenue have been found to be at equal fault in evaluating the land in question. We thus are of the considered opinion that the assessee only cannot be penalized for such an act and conduct of valuation of the property in these peculiar facts and circumstances by terming it as an instance of either concealment of income or furnishing of inaccurate particulars of income u/s.271(1)(c) of the Act. We accordingly direct the Assessing Officer to delete the impugned penalty of ₹ 5.33crores as partly confirmed in the lower appellate proceedings. - Decided in favour of assessee.
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