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TMI Blog2019 (9) TMI 1074X X X X Extracts X X X X X X X X Extracts X X X X ..... e us: "1. The Ld. CIT(A) is erred in confirming levying penalty u/s 271(1)(c) of Rs. 16,20,868/-. 2. Your honour is thus, requested to delete the penalty levied u/s 271(1)(c). 3. The appellant craves to add, alter amend or delete the above ground/s of appeal." 2. Briefly stated, the assessee firm which is engaged in the business of manufacturing of corrugated boxes, printing labels and pamphlets had filed its return of income for A.Y. 2010-11 on 10.03.2011, declaring total loss of Rs. 40,23,957/-. The return of income filed by the assessee was processed as such under Sec.143(1) of the Act. Subsequently, the case of the assessee was selected for scrutiny assessment under Sec. 143(2). 3. On the basis of AIR information, it was observe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A.O that the 'market value' of the gala as on the date of its sale by the assessee was Rs. 1,33,68,840/-. Accordingly, the A.O invoking the deeming provisions of Sec.50C of the Act, therein adopted the 'segment value' of the aforesaid property as its deemed sale consideration and worked out the STCG in the hands of the assessee at Rs. 52,45,526/-. As such, on the basis of his aforesaid deliberations the income of the assessee was assessed at Rs. 12,21,570/- by the A.O, vide his order passed under Sec.143(3), dated nil. The aforesaid addition made by the A.O was not carried any further in appeal by the assessee. 4. After the culmination of the assessment proceedings, the A.O called upon the assessee to explain as to why penalty under Sec.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said 'block of assets', therefore, no STCG on the sale of the same did arise. It was the claim of the ld. A.R that though the assessee was duly justified in not accounting any STCG on the sale of the aforesaid gala as per the mandate of Sec.50 of the Act, however, on account of the failure on the part of its counsel who had appeared in the course of the proceedings before the lower authorities to substantiate his claim, the assessee had been made to suffer a tax liability, despite the fact that there was no such obligation cast upon it as per the mandate of law. In sum and substance, it was the claim of the ld. A.R, that it was but for the failure on the part of the assesses counsel who had appeared in the course of the proceedings before t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the assessee was devoid and bereft of any merit, therefore, the same did not merit acceptance and was liable to be dismissed. 8. We have heard the authorised representatives for both the parties, perused the orders of the lower authorities and the material available on record, and also the judicial pronouncements relied upon by them. Admittedly, the assessee during the year under consideration had sold a gala viz. Sadhana Industrial Estate, for a consideration of Rs. 90,00,786/-. Also, there is no dispute on the fact that the 'segment rate' of the aforesaid property on the date of the sale transaction was Rs. 1,33,68,840/-. It is also a fact borne from the records, that the assessee had not disclosed the aforesaid sale transaction in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 01.04.2009 was Rs. 1,01,39,892/-) ,therefore, the 'block of assets' of the gala as on 31.03.2010 remained at Rs. 29,63,316/- [Rs. 18,24,210/- (+) Rs. 11,39,106/-]. In sum and substance, it is the claim of the assessee that as neither the 'block of asset' of the gala had ceased to exist during the year under consideration, nor the full value of consideration received or accruing as a result of transfer of the aforesaid gala exceeded the modified actual cost of the assets falling within the said block of assets, therefore, no STCG on the sale of the said gala viz. Sadhana Industrial Estate did arise in the hands of the assessee as per the mandate of Sec.50 of the Act. 10. We have given a thoughtful consideration to the aforesaid contention o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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