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TMI Blog2015 (8) TMI 878X X X X Extracts X X X X X X X X Extracts X X X X ..... aforesaid disallowance that was confirmed by ld. CIT(A) A. O vide order dated 30.03.2010 was of the view that Assessee had willfully knowingly and without reasonable cause furnished inaccurate particulars of income and had tried to conceal income so as to evade payment of taxes and has furnished inaccurate particulars of income and was therefore liable for penalty u/s. 271(1)(c) of the Act. He accordingly levied penalty of Rs. 83,914/-. Aggrieved by the penalty order of A. O., Assessee carried the matter before ld. CIT(A) who upheld the penalty order of A. O by holding as under:- 5. I have considered the submissions filed by the appellant and the contentions of the A. O. In the instant case, the shares have been sold by the appellant to the director / husband of the director. From the details, it appears that the transaction was done outside the Stock Exchange. Shares were sold at the price of 26 paisa per share despite the fact that book value of shares worked out to Rs. 9.94. Further, one day before the date of sale, these shares were sold at Stock Exchange @ 1.52 per share. Hence the sale of shares @ 26 paise per share was totally unjustified. The appellant has not submitted a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een non disclosure of material facts in this case as discussed above. Also after insertion of clause of (IB) of section 271 w. E. F. 01.04.1989, satisfaction need not be expressly recorded before initiation of penalty proceedings. Besides, the A. O. has held that the appellant has filed inaccurate particulars of income. Then he has invoked Explanation 1 to section 271 of IT. Act, 1961 by virtue of which the additions made are deemed to be amount in respect of which particulars have been concealed. 4. Aggrieved by the aforesaid order of ld. CIT(A), Assessee is now in appeal before us and has raised the following ground:- 1. Ld. CIT (A) erred in law and on facts in confirming penalty levied u/s 271(l)(c) of Rs. 83, 914- on conversion of business loss into capital loss and in adoption of higher rate for shares sold. Both the lower authorities failed to appreciate the fact that the appellant neither furnished inaccurate particulars nor concealed any income and simply because a different view was adopted for making the additions, penalty was leviable on additions sustained. The penalty levied being without any merits and justification deserves to be quashed. 5. Before us, ld. A. R. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the consideration received or accruing as a result of the transfer of the capital asset. There is no reference to the market value of the capital asset transferred in section 48 or in any other section except section 50C, which is applicable only in case of sale of landed property. In the case of Judgment of Hon'ble Gujarat High Court rendered in the case of CIT vs. Shri Girish Damjibhai Patel (supra), Hon'ble Gujarat High Court has also referred to the same provisions of section 48 and on the basis of same section 48 of the Act, it was held that since section 48 of the Act does not have any reference to the market value but only to the consideration referred to in the sale deed, there is no error in the ultimate conclusion arrived at by the C1T(A) as well as by the Tribunal in that case. Hence, ratio of this decision of Hon'ble Gujarat High Court is this that for the purpose of working out capital gain, the sale consideration received by the assessee or accrued sale consideration has to be adopted because there is no reference in section 48 to the value of the asset for the purpose of computing the capital gain., Regarding this contention that the asset in the presen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... our considered opinion, the judgment of Hon'ble apex court rendered in the case of Mcdowell & Co. Ltd. vs. C. T. O. (supra) has no relevance in the present case because we find that in the present case, the reasons are also given for adopting lower price of Rs. 0.26 per share as against the quotation at Bombay Stock Exchange of Rs. 1.52 per share. It is submitted that the assessee company has sold the shares in physical form to the related party whereas the shares traded at Bombay Stock Exchange were demat shares and if the assessee wants to sale the shares at a Stock Exchange, it has got the shares dematerialized which will require time and will also have its cost and moreover, the quantity of shares traded in the stock exchange in various months of the financial year at various dates in the month of March,2004 or in February,2004 was 100 shares on some dates, 200 shares on some dates, 300 shares on some dates and 1100 shares on one date only whereas the quantity of shares sold by the assessee is 3,32,940 shares. It was submitted that it cannot be said that the price charged by the assessee was unreasonably he facts of the present case. 8. Considering the facts of the prese ..... X X X X Extracts X X X X X X X X Extracts X X X X
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