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TMI Blog2017 (11) TMI 793X X X X Extracts X X X X X X X X Extracts X X X X ..... ome other expert gives another opinion, is not by itself sufficient for arriving at a conclusion that the assessee had furnished inaccurate particulars of income attracting penalty u/s 271(1)(c). Assessee has chosen to obtain the opinion of a registered valuer and the registered valuer has arrived at his opinion on certain basis. While he making the valuation report, disclosed all particulars. There can be a genuine difference of opinion of different expert and hence, once there is difference of opinion, the penalty u/s 271(1)(c) of the Act cannot be levied - Decided in favour of assessee. - ITA No.671/Mum/2014 - - - Dated:- 11-10-2017 - Shri Mahavir Singh, Judicial Member And Shri Manoj Kumar Aggarwal, Accountant Member For The Appellant : Hariom Tulsyan For The Respondent : T A Khan ORDER Per Mahavir Singh, Judicial Member This appeal by assessee arises out of the order of the Commissioner of Income Tax (Appeals) 30, Mumbai [in short CIT(A)] in appeal No.CIT(A)-30/ITO-19(1)(3)/IT-63/12-13 dated 10.12.2013. The assessment was framed by the Income Tax Officer-Ward 19(1)(3), Mumbai,(in short ITO or AO) for A.Y. 2009-10, vide his order dated 28.03.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8,33,333/- for his 1/3rd share. In the case of the other co-owner, the Assessing Officer after discussion of the case and as per Indian Valuers Directory Reckoner , as on 01.04.1981 has taken the cost of acquisition of the property as ₹ 2,05,00,000/- and accordingly, 1/3rd share was computed at ₹ 68,33,333/-. The capital gain in the case of Shri Chandrakant Malukchand Mehta was assessed accordingly. Subsequently, the assessee s case was re-opened by issuing of notice u/s. 148 of the Act on the same reasoning. The assessee in response to the said notice filed return of income as per the cost of acquisition as on 01.04.1981 taken by the other co-owner Shri Chandrakant Malukchand Mehta and re-worked capital gains as ₹ 59,06,980/-. However, Ld. AO, finally computed the capital gain as ₹ 62,60,801/- by substituting the cost of acquisition as on 01.04.1981 on the basis of Indian Valuers Directory Reckoner which came to ₹ 20,50,206/-. To support the original cost of acquisition of ₹ 669.30 Lacs adopted by the assessee, the assessee filed the valuer s report dated 19.03.2009 of Mr J V Udani, approved valuer, who valued the property as on 01.04.198 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Viz. Shri Harilal Malukchand Mehta to pay a sum of ₹ 1,13,29,500/- (Rupees one crore thirteen lakhs twenty nine thousand five hundred only ) as and by way of penalty u/s. 271(1)(c) of the Income Tax Act, 1961 read with explanation of the Income-tax Act, 1961. 4. Aggrieved the assessee preferred appeal before the CIT(A), who confirmed the action of the Assessing Officer vide para 6.1 and 6.2 as under: 6.1 I have duly considered the above submission of the appellant. However, from facts narrated in the penalty order, it is evident that the appellant has colluded with M/s J.V. Udani to obtain valuation report dtd.19.3.2009, wherein the - cost of acquisition of the property sold during the year has been shown at ₹ 3,45,00,000/- and 1/3rd of the above amount, i.e. ₹ 1,15,00,000/- was taken as cost of acquisition in the computation of LTCG. The appellant thus declared LTCL of ₹ 4,37,37,000/- on sale of the property, instead of LTCG of ₹ 62,60,801/-. On the contrary, another co-owner of the same property in his case, on the basis of valuation report dtd.19.3.2009 of the same valuer, M/s J.V. Udani, declared his 1/3rd share in the cost of acquisiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urn of income filed in response to notice issued u/s 148 in the light of value adopted by the co-owner and paid taxes thereupon. 6. We find that the Assessing Officer has simply not accepted the cost of acquisition as on 01.04.1981 as adopted by the assessee and relied on the Indian Valuers Directory Reference Book , to incorporate the market value of the property of Mumbai as on 01.04.1981 as written by Shri Santosh Kumar [Architect, Government Registered Valuer for Land Building] Shri Sunit Gupta [M Val. (RE), government registered Valuer for Real Estate], who has based the valuation as on 01.04.1981 on the basis sale instances for Mumbai. The assessee has also not objected to the assessment. But can this be a case for levy of penalty u/s. 271(1)(c) of the Act? We find that Hon ble Supreme Court in the case of Dilip N Shroff vs. JCIT [291 ITR 519] on the issue of capital gain on the basis of the valuer s report, which was not accepted by the Assessing Officer, the penalty was deleted and relevant observation of Hon ble Supreme Court reads as under: 91. The assessee could get the valuation done through any other mode of index value, or the assessee could have engage ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fact that the same postulates that inappropriate words and paragraphs were to be deleted, but the same had not been done. Thus, the Assessing Officer himself was not sure as to whether he had proceeded on the basis that the assessee had concealed his income or he had furnished inaccurate particulars. Even before us, the learned Additional Solicitor General while placing the order of assessment laid emphasis that he had dealt with both the situations. 96. The impugned order, therefore, suffers from non-application of mind. It was also bound to comply with the principles of natural justice (See Malabar Industrial Co. Ltd. v. CIT [2000] 2 SCC 718). 97. We have, however, noticed hereinbefore that the Income-tax Officer had merely held that the assessee is guilty of furnishing of inaccurate particulars and not of concealment of income; which finding was arrived at also by the Commissioner of Income-tax and the Income-tax Appellate Tribunal. 98. In K. C. Builders v. Asst. CIT [2004] 2 SCC 731, this court formulated the following questions for consideration (page 567) : 8. On the above pleadings and facts and circumstances of the case, the following questions of law ari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act and sections 120B, 34, 193, 196 and 420 of the Indian Penal Code. 100. The learned Additional Solicitor General, however, submitted that although on the facts of the case the decision rendered is correct the view of the court that unless there is some evidence to show or some circumstances found from which it can be gathered that the omission was attributable on the part of the assessee to conceal his income so as to evade Income-tax thereon may not be correct. As at present advised, we do not intend to go into the said question; as in the facts and circumstances of the case, there are enough materials to show that the action on the part of the appellant may not be said to be such which would attract the penal provision under section 271(1)(c) of the Act. 7. Even otherwise, the assessee has disclosed all the particulars and nothing was concealed by the assessee and Hon ble Supreme Court in the case of Reliance Petro Products Pvt. Ltd., 322 ITR 158 has clearly concluded that in case there is no concealment on facts or particulars, it cannot be a fit case for levy of penalty of income for furnishing inaccurate particulars of income. In the present case before us ..... X X X X Extracts X X X X X X X X Extracts X X X X
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