TaxTMI 
TaxTMI 
2016 (4) TMI 1039
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....ax Act 1961. 2. From the records, it is seen that the original return of income was filed declaring net taxable income of Rs. 1,73,710/- which was later revised to Rs. 2,59,560/- after including sale of a scrap at Rs. 85,850/- and capital gains at nil claiming deductions of Rs. of 12,22,667/- under section 54 of the Income Tax Act, 1961. Assessment under section 143 (3) of the Income Tax Act, 1961 was completed at an income of Rs. 7,06,930/- after adding Rs. 5,33,223/-on account of capital gains. During the year, the assessee had sold a residential house for Rs. 34,38,000/- and had invested Rs. 18,75,000/- in the acquisition of new residential property. Due to indexation, the capital gains amounted only to Rs. 12,22,667/- and the claim u....
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....ere accepted by the AR at the time of assessment proceedings. In case, the case would not have been selected under scrutiny, the assessee would have cheated the Government. Hence, it was detrimental to the revenue and I impose the penalty of Rs. 1,08,548/- under section 271(1)(c), which is equal to 100% of tax or to be evaded." 3. Aggrieved, the assessee preferred an appeal before the First Appellate Authority which was dismissed with the following remarks:- "8.25 In the present case also, it is seen that the assessee has made the bogus claim of a scrap sale for Rs. 85,850/- only as a tool for giving the colour of genuineness to the otherwise non-genuine claim of construction (referred to as the 'Disputed Construction' above). T....
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.... a lapse of almost 10 years. However, in penalty proceedings, mala fide was attributed to the assessee's claim in this regard and the penalty was imposed. We are of the view that penalty cannot be levied on presumptions only. Both the AO as well as the Commissioner have not demonstrated as to how mala fide could be attributed to a claim which, after a lapse of more than a decade, could not be substantiated by proper documents. We place reliance on the judgement of the Hon'ble Supreme Court in the case of Dilip N Shroff versus JCIT 291 ITR 519 wherein the Hon'ble apex court has observed as follows: "48. Primary burden of proof, therefore, is on the revenue. The statute requires satisfaction on the part of the assessing o....
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....le." 7. In the case of CIT vs Reliance Petroproducts Private Limited 322 ITR 158 (SC), the Hon'ble Apex Court has laid down the law as under:- "A glance at the provisions of section 271(1)(c) of the Income Tax Act, 1961 suggests that in order to be covered by it, there has to be concealment of the particulars of the income of the assessee. Secondly, the assessee must have furnished inaccurate particulars of income. The meaning of the word 'particulars' used in section 271(1)(c) would embrace the details of claim made. Where no information given in the return is found to be incorrect or inaccurate, the assessee cannot be held guilty of furnishing inaccurate particulars. In order to expose the assessee to penalty, unless the c....