https://www.taxtmi.com/caselaws?id=751846 ITAT Ahmedabad dismissed the department's appeal regarding penalty under Section 271(1)(c) for denial of capital gains exemption under Section 10(38) on share sales. The assessee's company was deemed not engaged in substantial business and not declaring dividends, leading to exemption disallowance. However, since the quantum proceedings were decided in favor of the assessee by ITAT, the penalty was deleted. The tribunal held that once quantum additions are deleted, penalty under Section 271(1)(c) cannot be sustained, citing precedents from Gujarat and Rajasthan HCs establishing that penalty cannot survive when its foundational basis is removed. en-us Wed, 24 Apr 2024 00:00:00 +0530 Fri, 26 Apr 2024 20:53:29 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=751846 ITAT Ahmedabad dismissed the department's appeal regarding penalty under Section 271(1)(c) for denial of capital gains exemption under Section 10(38) on share sales. The assessee's company was deemed not engaged in substantial business and not declaring dividends, leading to exemption disallowance. However, since the quantum proceedings were decided in favor of the assessee by ITAT, the penalty was deleted. The tribunal held that once quantum additions are deleted, penalty under Section 271(1)(c) cannot be sustained, citing precedents from Gujarat and Rajasthan HCs establishing that penalty cannot survive when its foundational basis is removed. Case-Laws Income Tax Wed, 24 Apr 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=751846