TaxTMI 
TaxTMI 
2014 (2) TMI 71
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....tted on May 3, 2010, to consider the following substantial questions of law : "(I) Whether, on the facts and in the circumstances of the case, the findings of the Tribunal that the assessee was not guilty of furnishing inaccurate particulars of income were made without properly appreciating the facts available on record ? (II) Whether, on the facts and in the circumstances of the case and in view of the provisions contained in section 271(1)(c) of the Income-tax Act, 1961 and Explanations thereto, the Tribunal was right in law in confirming the deletion of penalty by the Commissioner of Income-tax (Appeals) without considering the judgment of the Supreme Court in the case of Union of India v. Dharamendra Textile Processors [2008] 306 ITR 277 (SC) ?" 3. Briefly, the facts necessary for adjudication of the controversy involved, as narrated in the appeal may be noticed. The assessee filed its income-tax return on September 30, 1996, declaring income of Rs. 2,83,340 and agriculture income at Rs. 18,800. It was processed under section 143(1)(a) of the Act. The assessee ....
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.... of certificate obtained from the PWD authorities Sonepat and as such the property could not be treated as capital asset for the purpose of determination of capital gain. Consequently, the Assessing Officer rejected the claim of the assessee and brought the impugned capital gains under the capital gains tax. Assessment was completed under section 143(3) of the Act at the total income of Rs. 56,31,400, vide order dated December 31, 1998, annexure A. 1 against the returned income of Rs. 2,83,330. The Assessing Officer also initiated penalty proceedings under section 271(1)(c) of the Act for furnishing inaccurate particulars of income. Notice under section 274 read with section 271(1)(c) of the Act was issued on January 18, 1999. Aggrieved by the order, the assessee filed an appeal before the Commissioner of Income-tax (Appeals) (CIT(A)). Vide order dated September 28, 1999, annexure A. 2, the Commissioner of Income-tax (Appeals) dismissed the appeal. Not satisfied with the order, the assessee filed an appeal before the Tribunal. Vide order dated December 28, 2000, annexure A. 3, the Tribunal allowed the appeal, set aside the order of the Commissioner of Income-tax (Appeals) and resto....
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....sition Collector dated November 22, 1995, and the certificate dated June 19, 1996, obtained from the Sub Divisional Engineer, PWD wherein it was shown that the distance of the village in which the land of the assessee was situated was 8.2 kms. from the municipal limits of Sonepat. Relying upon the judgments reported in CIT v. Sidhartha Enterprises [2010] 322 ITR 80 (P&H), CIT v. Reliance Petroproducts P. Ltd. [2010] 322 ITR 158 (SC), CIT v. B. B. Singhal, I. T. A. No. 725 of 2010 dated January 5, 2011 (P&H), CIT v. Raj Overseas [2011] 336 ITR 261 (P&H), CIT v. Dabwali Transport Co. I. T. A. No. 872 of 2010, dated March 15, 2011 (P&H)-since reported in [2013] 1 ITR-OL 577 (P & H), CIT v. Deep Tools P. Ltd. [2005] 274 ITR 603 (P&H) and Price Waterhouse Coopers P. Ltd. v. CIT [2012] 348 ITR 306 (SC), it was argued that there was no intention of furnishing inaccurate particulars on the part of the assessee and the Tribunal as well as the Commissioner of Income-tax (Appeals) had rightly deleted the penalty. The reliance was placed upon the following observations recorded by the apex court in Price Waterhouse Coopers Pvt. Limited's case (supra) (page 318) : &nb....
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....ion of penalty by the Commissioner of Income-tax (Appeals), noticed that the assessee had furnished a certificate dated June 19, 1996, from the Sub Divisional Engineer Maintenance Sub Division, B&R wherein it was specified that the distance from the Sonepat Municipal Committee to Village Kamaspur, Tehsil and District Sonepat was 8.2 kms. It was also noticed that there were various certificates wherein different distances had been mentioned. After considering the matter, the Tribunal came to the conclusion that there was no intention on the part of the assessee to furnish inaccurate particulars. It was recorded as under : " . . . There is no evidence to prove that there was deliberate concealment of income by the assessee because the certificate relied upon by the assessee is not acted upon and that itself cannot lead to levy of penalty and it cannot be said that the assessee has committed an offence under section 271(1)(c) of the Act. The Department has not proved that the certificate furnished by the assessee was found to be false and thus it is not possible to infer that the assessee has furnished inaccurate particul....
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....the property from the Municipal limits of Sonepat. On the facts set out above, we find that the inference drawn by the Assessing Officer that the assessee has consciously concealed the particulars is not based on the falsity of the explanation given by the assessee. We are saying this because the Assessing Officer though collected the multiple certificates which are showing different distance of the property from the municipal limit of Sonepat, there was a confusion regarding the correct distance of the property from the municipal limit of Sonepat. Because of this the Tribunal directed the learned Commissioner of Income-tax (Appeals) to once again determine the correct distance of the property from the municipal limits of Sonepat and thereafter assessment was completed. There was no positive and definite material with the Assessing Officer to show that the certificate was bogus. The SDE, Maintenance Sub Division, PWD (B&R) is a Government authority and this was procured by the assessee for the purpose of assessment which was not acted upon and there was no finding regarding the fact that the authority is not competent person to issue the certificate and there was no finding that th....