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2023 (5) TMI 220 - AT - Income TaxPenalty u/s 271(1)(c) - furnishing inaccurate particulars of income - capital gain on account of the applicability of section 50C - HELD THAT - As regards the capital gain on account of the applicability of section 50C of the Act, the assessee has already showed the income in response to the notice issued u/s. 148 - assessee also emphasized that the difference is less then 10 % as changed in the law and even though the assessee has paid the tax and now in accordance in the change in price range the assessee should get the benefit at least in the levy of penalty based on the decision of CIT Vs. Vatika Township 2014 (9) TMI 576 - SUPREME COURT beneficial provision should be read liberally. The bench also noted that decision relied upon by the lower authority are having the different facts and are not applicable to the facts of this case. As regards the balance addition made on account of the meager amount and on account of difference of opinion only. As referring to case of CIT Vs. Reliance Petroproducts Private Limited 2010 (3) TMI 80 - SUPREME COURT we vacate the levy of penalty u/s. 271(1)(c) of the Act - Appeal of the assessee is allowed.
Issues Involved:
The issues involved in the judgment are the imposition of penalty under section 271(1)(c) of the Income Tax Act for the assessment year 2012-13 based on discrepancies in the income declared by the assessee, specifically related to the sale of property and penny stock. Details of the Judgment: Issue 1: Penalty Imposed without Establishing Actual Concealment The appeal was filed by the assessee against the penalty of Rs. 54,879 imposed by the assessing officer without establishing actual concealment, despite the assessee making voluntary and bonafide disclosure. The assessment was reopened based on discrepancies in the income declared by the assessee, leading to the penalty proceedings under section 271(1)(c) of the Act. The assessing officer charged the penalty for furnishing inaccurate particulars of income. The CIT(A) upheld the penalty, stating that the appellant failed to declare the stamp duty value in the income tax return, which was required by law. The appellant's argument regarding the retrospective application of the 10% tolerance band from the Finance Act 2021 was rejected. However, the tribunal vacated the penalty based on various legal precedents and the appellant's compliance with the notice issued under section 148 of the Act. Issue 2: Addition on Account of Capital Gains from Penny Stock The assessing officer made an addition of Rs. 21,300 on account of income received from the sale of penny stock, which the appellant accepted to avoid litigation. The CIT(A) upheld this addition, stating that the appellant's involvement in penny stock was a colorable device. The tribunal, considering the appellant's compliance with the notice under section 148 and the meager amount involved, vacated the penalty based on legal precedents and the principle of liberal interpretation of beneficial provisions. Separate Judgment by the Tribunal: The tribunal, after hearing the rival contentions, noted that the appellant had already declared the income related to the capital gains in response to the notice issued under section 148. The tribunal emphasized the applicability of the change in the law regarding the 10% tolerance band and the benefit the appellant should receive based on the decision of the apex court. Relying on legal precedents and the facts of the case, the tribunal vacated the penalty imposed under section 271(1)(c) of the Act for the amount of Rs. 54,879. This summary provides a detailed overview of the judgment, highlighting the issues involved, the arguments presented by the parties, and the final decision of the tribunal.
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