2014 (12) TMI 1169 - AT - Income Tax

Penalty u/s 271(1)(c) - inaccurate particulars furnished by assessee in respect of value adopted for computation of capital gain in view of the mandatory provision of section 50C - CIT(A) deleted the addition - Held that - As it is clear that the assessee has disclosed all relevant details as well as documents in support of its computation of Short term Capital Gain by taking into consideration the actual sale consideration received by the assessee. The fact of actual sale consideration received by the assessee has not been disputed by the Assessing Officer but the addition was made simply by applying the deeming provisions of section 50C. Therefore in view of the various decisions as relied upon by the Ld. Authorized Representative as well as by the CIT(A) we do not find any error in the impugned order of CIT(A) in deleting the penalty levied u/s 271(1)(c). - Decided in favour of assessee.

Summary

Issues:
Levy of penalty u/s 271(1)(c) for inaccurate particulars in computation of capital gain under section 50C of the Income Tax Act.

Analysis:
The appeal by the revenue challenged the CIT(A)'s cancellation of the penalty u/s 271(1)(c) for inaccurate particulars in capital gain computation under section 50C. The Assessing Officer added to the Short term Capital Gain based on stamp duty authority valuation, resulting in a penalty of &8377; 22,12,069. The CIT(A) deleted the penalty citing no concealment of income particulars by the assessee.

During the hearing, the Ld. DR argued that not applying section 50C amounts to furnishing inaccurate income particulars and concealment, while the Ld. Authorized Representative contended that the assessee provided all relevant details and records, and the addition made was unjustified. The CIT(A) found in favor of the assessee, noting no concealment and that the sale consideration was genuine.

The Tribunal observed that the Assessing Officer did not question the actual sale consideration disclosed by the assessee, and the penalty was based on section 50C deeming provisions. The CIT(A) decision to delete the penalty was supported by various legal precedents, emphasizing that the assessee disclosed all relevant details and there was no concealment or doubt regarding the sale consideration authenticity.

Ultimately, the Tribunal upheld the CIT(A)'s decision, stating that the assessee provided all necessary details and documents for Short term Capital Gain computation based on actual sale consideration. The penalty under section 271(1)(c) was deemed unjustified, leading to the dismissal of the revenue's appeal.

In conclusion, the Tribunal affirmed the CIT(A)'s order, emphasizing the genuine disclosure of details by the assessee and the lack of error in deleting the penalty under section 271(1)(c) for inaccurate particulars in capital gain computation under section 50C of the Income Tax Act.