https://www.taxtmi.com/caselaws?id=769314 The Calcutta HC upheld the Tribunal's decision to set aside penalty u/s 271(1)(c) imposed on an assessee for claiming capital loss on HUF dissolution. The court found that the AO had accepted the complete HUF partition during assessment proceedings under Section 143(3), making it inconsistent to later deny recognition of the partition for penalty purposes. The court noted that the reason for initiating penalty proceedings differed from the AO's conclusion in the penalty order, constituting an incurable defect. Since the assessee's treatment of assets as transfer upon partition was a genuine mistake subsequently clarified during assessment, and penalty proceedings require independent proof of concealment and tax evasion, the penalty was unjustified. en-us Wed, 16 Apr 2025 00:00:00 +0530 Wed, 23 Apr 2025 09:09:33 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=769314 The Calcutta HC upheld the Tribunal's decision to set aside penalty u/s 271(1)(c) imposed on an assessee for claiming capital loss on HUF dissolution. The court found that the AO had accepted the complete HUF partition during assessment proceedings under Section 143(3), making it inconsistent to later deny recognition of the partition for penalty purposes. The court noted that the reason for initiating penalty proceedings differed from the AO's conclusion in the penalty order, constituting an incurable defect. Since the assessee's treatment of assets as transfer upon partition was a genuine mistake subsequently clarified during assessment, and penalty proceedings require independent proof of concealment and tax evasion, the penalty was unjustified. Case-Laws Income Tax Wed, 16 Apr 2025 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=769314