Penalty cancelled where appellant had disclosed all material particulars
Penalty cancelled where appellant had disclosed all material particulars
Appellant claimed exemption u/s 54F (of Income Tax Act, 1961) on long term capital gains on sale of land in Indore. During scrutiny proceeding, appellant withdrew the claim. A 100% penalty was levied u/s 271(1)(c) (of Income Tax Act, 1961) for furnishing inaccurate particulars and concelment of income. CIT(A) dismissed appellant's appeal. Cancelling the penalty, ITAT held that withdrawing the claim suo-motto before any enquiry does not amount to furnishing of inaccurate particulars of income.-500945
1 The appellant filed return of income for the A.Y 2007-08 on 22/8/2007, disclosing income of Rs.2,39,486/-. The appellant had disclosed long term capital gains on sale of land situated at Indore,
in respect of which exemption u/s 54F (of Income Tax Act, 1961) of Rs.18,93,024/- was claimed. During the scrutiny assessment proceedings, it was found from the Balance Sheet as on 31/3/2007 that the appellant was the owner of two residential properties, other than the third residential property purchased
during the year and in respect of which exemption u/s 54F (of Income Tax Act, 1961) had been claimed. Approval was taken from the JCIT, Range-22, New Delhi, for comprehensive scrutiny, and the appellant was required to
justify her claim for exemption. In response, the Authorized Representative filed a letter dated 17/9/2009 withdrawing the claim and offering the long term capital gains of Rs.19, 05,431/- for tax.
The assessment was completed at an income of Rs.21, 44,920/- and penalty proceedings were initiated u/s 271(1)(c) (of Income Tax Act, 1961) for furnishing inaccurate particulars of income and concealment of income. Penalty was levied at 100% of the tax sought to be evaded which worked out to Rs.4, 27,579/-.
2 CIT(A) dismissed the appellant's appeal.
3 On appeal the ITAT held as under:
" 4. We have perused all the records and heard both the parties. The contentions of the assessee that all the material particulars were disclosed before the Assessing Officer is correct. It is pertinent to
note that no query about the long term capital gain has been raised by the Assessing Officer. All the disclosure in return of income has been properly done by the assessee. Merely claiming exemption
u/s 54F (of Income Tax Act, 1961) and thereafter withdrawing the same suo-motto before any enquiry does not amount to furnishing of inaccurate particulars of income. Therefore, the assessee's explanation, in our view is bonafide. Hence, we cancel the penalty levied u/s 271(1)(c) (of Income Tax Act, 1961) as confirmed by the Ld. CIT(A).
5. In result, the appeal is allowed."
Case reference-BEFORE SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER AND SMT SUCHITRA KAMBLE, JUDICIAL MEMBER I.T.A .No.-787/DEL/2013 (ASSESSMENT YEAR-2007-08) Manak Devi Surana vs ITO
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH: 'E' NEW DELHI
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