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TMI Blog2016 (3) TMI 817X X X X Extracts X X X X X X X X Extracts X X X X ..... on to defraud the revenue. It cannot in such circumstances be said that the assessee had furnished any inaccurate particulars of income since the particulars of income furnished by him were based on a registered valuer report which has not been rejected by any authority below. In view of the same we hold that the assesse having not furnished any inaccurate particulars of income, levy of penalty under section 271(1)(c) is uncalled for and ought to be dismissed. - Decided in favour of assessee - ITA No.63/Ag/2014 - - - Dated:- 9-2-2016 - SHRI BHAVNESH SAINI , JUDICIAL MEMBER AND MS. ANNAPURNA MEHROTRA, ACCOUNTANT MEMBER For The Appellant : Sh. Mahesh Agrawal For The Respondent : Sh. Waseem Arshad ORDER PER ANNAPURNA MEH ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : ₹ 10,80,590/- Construction of H.P. : ₹ 16,28,245/- While computing the total income the assessee reduced the amount of unexplained investment in construction of house property from ₹ 10,80,590/- to ₹ 9,71,090/- by relying upon report of a chartered valuer. 4. During the course of assessment proceedings the investment in the construction of house property was worked out at ₹ 19,21,550/- wherefrom ₹ 4,86,910/- was reduced on account of explained investment and balance amount of ₹ 14,34,640/- was added to the total income of the assessee as against ₹ 9,71,090/- disclosed by the assessee in the return of income. The assessee pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sh any explanation. Even during the course of appellate proceedings also, the assessee has merely cited some case laws. These case laws have been given on different set of facts and are not applicable in the case of the appellant. The appellant has not disputed the fact that the assessee has shown his income on account of unexplained investment in construction of house at ₹ 9,71,090/- in place of the correct amount of ₹ 10,80,590/-. As the assessee has concealed particulars of his income under the head unexplained investment in the construction of house, therefore, I am of the considered opinion that the A.O. has rightly levied penalty u/s 271(1)(c). The case of the appellant is fully covered under explanation 1 to section 271(1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the amount of undisclosed investment is the same. Question no. 3 its reply is reproduced here under: Referring to the same Ld. AR stated that it is clear from the above that the assessee had estimated the investment in house property at 15,67,500/- by applying a rate of ₹ 350/- to ₹ 300/- to the area constructed on the different floors. Ld. AR stated that it was not an exact figure of cost of construction. Thereafter Ld. AR drew our attention to question no. 2 to the third statement recorded during survey on 10/11/2005, reproduced at page 14 of the paper book as follows: Referring to the same Ld. AR submitted that even during the course of survey when the statement of the above was recorded the assessee had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cost of construction in the impugned property who worked out a total investment in the property at ₹ 14,58,000/-. Relying upon the same the undisclosed investment in house property was shown in the return of income filed by the assessee to be ₹ 9,71,090/-. The reduction in value of investment was not accepted by the assessing authority and the appellate authority who held that the investment in the construction of the house property was to be taken at the amount disclosed by the assessee and surrendered during the course of survey and accordingly addition of ₹ 1,09,500/- was confirmed, to the income of the assessee. Penalty u/s 271(1)(c)has been levied on this amount. In the back drop of the facts stated above, it has to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also evident that the assessee had admitted during the course of recording of statement during survey itself that the correct value of the property could be estimated by the valuer only. The relevant question raised on the issue and reply is reproduced above. From the above fact it is evident that the surrender had been based on an estimate made by the assessee which was restricted to the extent of value calculated after getting the proper valuation done by the registered valuer. In such circumstances the assessee was well within his limits to have harbored a belief that the correct value of investment in the house property was that which was determined by the registered valuer and accordingly the disclosure of undisclosed investment in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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