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Issues involved: Appeal against deletion of penalty u/s 271(1)(c) of IT Act for Assessment Year 2006-07.
Summary: The sole issue pertains to the deletion of penalty amounting to Rs. 13,29,194/- imposed u/s 271(1)(c) of the Act. The assessee had initially claimed a long term capital loss on the sale of a flat, which was subsequently revised due to a clerical error in the indexed cost calculation. The Assessing Officer (AO) initiated penalty proceedings based on this revision. The assessee contended that the revised calculation did not affect the tax liability, and it was a bona fide mistake. The Commissioner of Income-tax (Appeals) (CIT(A)) observed that the revised computation was beneficial to the revenue and deleted the penalty, except for a minor amount related to the difference in Minimum Alternate Tax (MAT) income. During the appeal, the Revenue argued that the assessee's mistake in indexing the cost of acquisition led to the penalty imposition, while the assessee maintained that all necessary facts were disclosed, and the revision was made voluntarily. The Tribunal noted that the difference in opinion regarding the date of property acquisition was inconsequential as the income was ultimately assessed under MAT provisions. Citing the decision in CIT vs. Reliance Petroproducts Ltd., it was emphasized that penalty under sec. 271(1)(c) requires inaccurate particulars, which were not found in this case. The Tribunal upheld the CIT(A)'s decision to delete the penalty, as the revised computation did not result in under-assessment of income. In conclusion, the appeal by the Revenue was dismissed, affirming the deletion of the penalty u/s 271(1)(c) by the CIT(A) in relation to the capital gains computation. Judges: Shri Rajpal Yadav, Judicial Member and Shri K.D. Ranjan, Accountant Member
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