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TMI Blog2012 (12) TMI 62X X X X Extracts X X X X X X X X Extracts X X X X ..... The assessee has not disputed said fresh assessment order in any appeal. Hence, penalty proceedings as per clause (c) of Sec. 275(1) of the Act could be passed on or before 30.6.2010. Since penalty order is passed on 25.6.2010, it is well within time as provided u/s. 275 of the Act. - ITA No.1656/Mum/2011 - - - Dated:- 20-1-2012 - SHRI B.R. MITTAL AND SHRI J.SUDHAKAR REDDY, JJ. Assessee by: Shri R.S. Samria Respondent by: Shri V.V. Shastri ORDER PER B.R. MITTAL, JM : The assessee has filed this appeal for assessment year 2001-02 against order of Ld. CIT(A) dt. 20.1.2011 vide which Ld. CIT(A) has confirmed penalty on income of Rs. 1,21,65,000/- u/s. 271(1)(c) of the Act . In the appeal filed by assessee, assessee has also stated that levy of penalty is barred by limitation as well. 2. The relevant facts giving rise to this appeal are than in the return filed, assessee had shown Short Term Capital Gain of Rs.9.06 lakhs on sale of one flat. The assessee also showed advances of Rs. 7,00,000/- against sale of another flat. During the course of assessment proceedings, Assessing Officer found that assessee entered into an agreement with M/s. Celica Investm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of AO in bringing to tax Long Term Capital Gain on surrender of tenancy rights in the current year. However, Tribunal set aside the assessment and directed the AO to recompute Long Term Capital Gain after ascertaining value of flats based on market price or other contemporary materials in order to make a reasonable estimate of full value of consideration received on transfer of tenancy rights. The Tribunal also directed AO to recompute Short Term Capital Gain after ascertaining correct value of flat and also whether assessee had merely received advance against other flat i.e. flat No. 408 or that also had been transferred during the year. In view of above, AO completed fresh assessment vide order dt. 21.12.2009 reassessing the Long Term Capital Gain of Rs. 1,21,65,000/-, same as in the original assessment order made on 29.3.2004 and also assessed Short Term Capital Gain of Rs. 3,59,629/- on sale of flats. It is relevant to state that said fresh assessments made on 21.12.2009 remained unassailed. 5. In view of above, AO initiated penalty proceedings u/s. 271(1)(c) of the Act stating that assessee concealed income to the extent of Rs. 1,25,24,629/- (Rs. 1,21,65,000/- + 3,59, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eliance Petro Products Pvt. Ltd. 322 ITR 158, wherein Hon ble Apex Court interpreted the meaning of the expressions, concealment inaccurate , and particulars used in clause (c) of Sec. 271(1)(c) and held that everything would depend upon the return of income filed because that was the only document where the assessee can furnish the particulars of income. The Apex Court held that when the assessee furnished all details of expenditure as well as income in its return which details in themselves were not found to be inaccurate nor could be viewed as the concealment of income on its part, it was up to the authorities to accept its claim in the return or not and merely because the assessee had made the claim which claim was not accepted or was not acceptable to the revenue as the same was not sustainable in law, that by itself would not attract the penalty u/s. 271(1)(c). The Apex Court held that when such particulars are found to be inaccurate, untrue or false, the liability of penalty would arise. 10. In the instant case the AO assessed Long Term Capital Gain on surrender of tenancy right and Short Term Capital Gain on sale of flats. What the appellant declared in its return of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her appeal before Tribunal. 9. On behalf of assessee, it was contended that penalty order is barred by limitation as the original assessment was made on 29.3.2004 and whereas penalty order is passed u/s. 271(1)(c) of the Act is dt. 25.6.2010. Ld. AR relied on the decision of Hon ble Allahabad High Court in the case of CIT Vs Moradabad General Art Metal Mills 282 ITR 510 (All). He submitted that penalty order is in respect of original assessment order and not in respect of revised assessment order which was passed by AO pursuant to the order of Tribunal dt. 30.01.2009. Ld. AR referred to page-6 of fresh assessment order dt. 21.12.2009 and submitted that AO stated that penalty proceedings u/s. 271(1)(c) of the Act as initiated in the original order u/s. 143(3) of the Act are sustained for furnishing inaccurate particulars of income. He submitted that present penalty order is in continuation of penalty proceedings initiated for the original assessment order dt. 29.3.2004 and not in respect of fresh assessment order. However, Ld. DR submitted that AO initiated fresh penalty proceedings u/s. 271(1)(c) of the Act pursuant to fresh assessment order passed after the matter was set aside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e facts based on market price or other contemporary materials in order to make a reasonable estimates of full value of consideration received. The Tribunal also stated that AO is to re-compute Short Term Capital Gain after ascertaining correct value of flat and also to ascertain whether in respect of other flat assessee received only advance and there was no sale of flat in the assessment year under consideration. We observe that AO passed fresh assessment order dt. 25.12.2009, copy of which is placed in Annexure-IV, at pages 24 to 30 of Memo of appeal. Hence, we agree with Ld. DR that decision of Hon ble Allahabad High Court relied upon by Ld. AR (supra) is not applicable to the facts of the case before us. Further, we agree with Ld. CIT(A) that penalty proceedings has been initiated by AO on the basis of fresh assessment order dt. 21.12.2009. The assessee has not disputed said fresh assessment order in any appeal. Hence, penalty proceedings as per clause (c) of Sec. 275(1) of the Act could be passed on or before 30.6.2010. Since penalty order is passed on 25.6.2010, it is well within time as provided u/s. 275 of the Act. Hence we do not find any infirmity in the order of Ld. CI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... delay in handing over possession of flats allotted. Thus, AO has worked out Long Term Capital Gain of Rs. 1,21,65,000/- as cost of acquisition of tenancy right has been taken at Nil in terms of Sec. 55(2) of I.T. Act. 15. It is a fact that assessee contended in the first place that it surrendered tenancy rights in the assessment year 1994-95 but Tribunal did not accept the said contention of assessee. We observe that AO has computed Long Term Capital Gain as per direction of Tribunal that assessee surrendered tenancy rights in assessment year under consideration. The Tribunal also directed AO to ascertain value of flats based on market price and other contemporary material in order to make a reasonable estimate of full value of consideration received. We observe that AO has adopted a reasonable basis for computing Long Term Capital Gain on surrender of tenancy rights of Rs. 1,21,65,000/- and the assessee has not disputed the said finding of AO as made in the fresh assessment order passed on 21.12.2009. We agree with Ld. CIT(A) that declaring Long Term Capital Gain on surrender of tenancy right is one thing and declaration of declaring Short Term Capital Gain on sale of flats acqu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of Rs. 6,00,00,000/- in the original return filed for assessment year 2002-03 and also disclosed amounts received subsequently and offered to tax by filing return of income. However, in the case before us, as mentioned hereinabove, assessee was allotted 8 flats admeasuring total area of 4055 Sq. ft in assessment year 2001-02 and on it Long Term Capital Gain is computed at Rs. 1,21,65,000/- and the said computation was not disputed by assessee in further appeal. There is no dispute to the fact that assessee initially contended that tenancy right was surrendered in assessment year 1994-95 but it was held by Tribunal on the basis of the fact that surrender of tenancy had taken place in assessment year 2001-02 and accordingly, Long Term Capital Gain has arisen to assessee in the assessment year 2001-02. Therefore, we hold that Ld. CIT(A) has rightly held that there was concealment of particulars of income by assessee to the extent of Long Term Capital Gain of Rs. 1,21,65,000/- in assessment year 2001-02. Hence, we uphold order of Ld. CIT(A) and reject ground of appeal taken by assessee. 18. In the result, appeal filed by assessee is dismissed. - - TaxTMI - TMITax - Income Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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