2010 (10) TMI 94 - HC - Income Tax

Long term capital gain on shares - Subsequently he surrendered the aforesaid claim of long term capital gain on shares to be assessed at the normal rate of tax with the prayer that no penalty proceeding be taken under Section 271 (1) (c) of the Income Tax Act 1961 - Held that - penalty proceedings were also dropped - Appeal is allowed

Summary

The appeal relates to the assessment year 2002-03. Initially, the respondent showed long term capital gain on shares but later surrendered the claim and requested no penalty under Section 271(1)(c) of the Income Tax Act, 1961. The request was accepted, penalty proceedings were dropped, but later set aside by the Commissioner of Income Tax under Section 263. The respondent appealed to the Income Tax Appellate Tribunal, which allowed the appeal. The High Court dismissed the appeal, stating that there was no illegality in setting aside the Commissioner's order.