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TMI Blog2011 (10) TMI 651X X X X Extracts X X X X X X X X Extracts X X X X ..... preciation of the facts of the case. In view of elaborate submissions filed coupled with legal position, the impugned penalty of Rs. 1,18,611/- ought to have been deleted. 2. The learned CIT(A) has erred in not appreciating the fact that though the speculation profit of Rs. 5,54,284/- was not considered in the computation of total income through oversight and mistake, the same being other wise eligible for set-off against speculation loss of earlier years, there was neither any malafide intention nor revenue effect and it was merely a case of a bonafide mistake. This being the case, the appellant's case does not fall within the scope and ambit of penal provisions of section 271(l)(c) of the Act and as a corollary the penalty of Rs. 1, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a show cause notice as to why penalty be 'not levied on this issue. The assessee replied that the OIT(A) has already allowed set off of carried forward speculation loss against this recognition profit and hence there is no change in respect final taxable income. In view of this reason, no penalty should be levied. The AO did not accept this explanation and stated that the addition of Rs. 5,54,284/-was correctly made as the assessee had not shown this speculation profit in the P&L account and the addition has been confirmed by the CIT (A). The AO stated that the assessee had concealed the income by not disclosing the same in the income tax return. In respect of this speculation profit of Rs; 5,54,284/-. The AO levied the penalty on this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n record and have gone through the orders of authorities below. As per the facts of the present case, we find that the assessee earned this income of Rs. 5,54,284/- on account of speculating profit and instead of crediting the same to the P & L account, the same was credited by the assessee to the capital account and in the computation of income also, this income was not offered for taxation. Regarding set off of brought forward losses, it is admitted position that he assessee was eligible for set off of brought forward losses and as per the appeal effect after order passed by the A.O. on 17.08.2009, such set off was allowed also but it has resulted into reduction in carry forward of unabsorbed speculation loss of Rs. 16,95,220/- as claimed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce in the facts, this judgment of Hon'ble Gujarat High Court is not applicable in the present case. 8. Now, we consider the applicability of the judgement of Hon'ble Delhi High Court rendered in the case of Zoom Communications Pvt. Ltd. (supra) on which reliance has been placed by the Ld. D.R. In that case, it was held by the Hon'ble Delhi High Court that in the absence of assessee company telling the A.O. as to who committed the oversight resulting in failure to add the amount in question while computing the income of the assessee and under what circumstances, the oversight occurred and why it was not detected by the person who checked income tax return when it was filed and by the auditors of the assessee company, it cannot be accepted t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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