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TMI Blog2013 (9) TMI 1196X X X X Extracts X X X X X X X X Extracts X X X X ..... peal, the solitary issue relates to the penalty imposed by the Assessing Officer under Section 271(1)(c) of the Act amounting to ₹ 28,48,775/-, which has since been deleted by the CIT(A). 3. In brief, the facts are that assessee, an individual, filed a return of income declaring total income of ₹ 11,92,680/-, which was subjected to a scrutiny assessment under Section 144 of the Act dated 23.12.2008, whereby the total income was determined at ₹ 1,11,23,060/-. The said income was scaled down to ₹ 96,56,060/- consequent to the order of the Commissioner of Income Tax (Appeals)-I, Thane wherein certain relief was allowed. Subsequently, the Assessing Officer passed an order on 29.07.2010 treating the assessee guilty of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and accordingly, penalty of ₹ 28,48,775/- was imposed. 5. In appeal, the CIT(A) deleted the levy of penalty regarding the profit on sale of shares on the ground that assessability of such profit as capital gain or business income was merely a difference of opinion between the assessee and the Revenue for which no penalty under Section 271(1)(c) of the Act could be levied. Secondly, with respect to the disallowance of proportionate interest of ₹ 11,901/-, the CIT(A) has deleted the same on the ground that in the assessment order no penalty under Section 271(1)(c) of the Act was initiated on the said score. Accordingly, the entire penalty imposed of ₹ 28,48,775/- by the Assessing Officer was deleted by the CIT(A). Ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... han a period of 18 months prior to sale and the gain on sale of such shares was clearly a long term capital gain. Merely because the Assessing Officer has not accepted the same, and has taxed it as business income cannot lead to an inference of concealment of income and/or furnishing of inaccurate particulars of income. It is further pointed out that at no stage assessee has concealed any income or furnished inaccurate particulars of income and it is a case where a claim made by the assessee in the return of income has not been accepted by the Assessing Officer. Accordingly, the order of the CIT(A) is sought to be defended. 8. We have carefully considered the rival submissions. The factual matrix of the present case clearly brings out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lethora of judicial pronouncements also on the said subject. Presently, we are dealing with the levy of penalty under Section 271(1)(c) of the Act and not on the merits of the respective claims regarding the assessability of impugned transaction of purchase and sale of shares. Nevertheless, it is important to examine the bonafides of assessee s claim made in the return of income that the impugned gain on purchase and sale of shares is assessable as Capital Gains . For the said purpose, the following features of the case are notable i.e. the impugned shares were held for a period exceeding 18 months prior to sale; assessee s assertions that such shares have been acquired out of own funds; that the assessee has been declaring capital gain on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, in our view, the CIT(A) made no mistake in observing that following the ratio of the judgement of the Hon ble Supreme Court in the case of CIT vs. Reliance Petroproducts (P) Ltd. (2010) 322 ITR 158 (SC), there was no furnishing of inaccurate particulars in the present case within the meaning of Section 271(1)(c) of the Act. The CIT(A) has further relied upon the judgement of the Hon ble Supreme Court in the case of Reliance Petroproducts (P) Ltd. (supra) to hold that merely making of an incorrect claim in law would also not tantamount to furnishing inaccurate particulars of income. The aforesaid conclusion of the CIT(A), in our view, is fair and proper and is hereby affirmed. Similarly, the CIT(A) has relied upon the judgement of the Hon ..... X X X X Extracts X X X X X X X X Extracts X X X X
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