TaxTMI 
TaxTMI 
2017 (1) TMI 777
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....re as under: - 2.1 The assessee filed her return of income for A.Y. 2008-09 on 30.03.2009 declaring total income of Rs. 46,99,360/- under the heads of income from house property, short term capital gains (STCG), long term capital gains (LTCG) and 'income from other sources'. The case was subsequently taken up for scrutiny. In the course of assessment proceedings the Assessing Officer (AO) observed that the assessee was engaged in the activity of purchase and sale of equity shares of various companies. On examination thereof, the AO came to the view and held that the income shown under the head STCG by the assessee is to be assessed under the head income from 'Business and Profession' and in this regard initiated penalty proceedings under....
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....09 holding as under at para 5.10 thereof:- 510. I have gone through the facts marshaled during the assessment and penalty proceedings and observed that the appellant is in the business of investment in shares. Appellant's plea that the issue was debatable cannot be stretched beyond the point to believe. Besides, if the claim itself is impossible to accept and is contrary to fundamentals of tax or accountancy it cannot be accepted. That is why in the instant case AO's stand has been upheld by the appellate authorities. Bona fide belief of an appellant in treating a particular item of income has limited role for deciding the issue of penalty to be imposed u/s 271(1) (c). Facts of the case decide whether a belief could be treated as....
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.... inaccurate particulars by showing the income of Rs. 8,19,451/- under the head "short term capital gain" which ought to have been declared under the head "income from business or profession" without appreciating the facts and circumstances of the case. Hence, the levy of penalty of Rs. 1,18,735/- is unjustified and the same may be deleted. 3. The Appellant craves leave to add, alter, rescind or amend any of the above grounds of appeal." The only issue raised in this appeal is against the order of the learned CIT(A) for confirming the levy of penalty by the AO under section 271(1)(c) of the Act for furnishing of inaccurate particulars of income. 3.2 When the case was called for hearing, none was present for the assessee, but the lea....
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....pheld by the learned CIT(A). 3.3.2 We find from the details on record, placed before authorities below by the assessee, that the assessee's proposition was that its activity of dealing/investment in shares and securities are investment activity and not business activity as held by the AO/CIT(A) and that there was only a change of head of income from STCG to business income and therefore there was no furnishing of inaccurate particulars of income as is being sought to be made out. From the details on record before us, we too observe that there is only a change of head of income by the AO from 'STCG' income on account of investment in shares and securities declared by the assessee to 'business income' by the AO and there is no addition to ....
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....tures in its computation of income. Further, the Tribunal records that it is not the case of the department that the respondent-assessee had concealed any particulars of income or furnished inaccurate particulars of income by stating incorrect facts. The assessing officer considered the said premium received on redemption of debentures to be taxable under the head income from other sources while the respondentassessee considered the same to be taxable under the head capital gains. In view of the fact that there is only a change of head of income and in the absence of any facts that the claim of the assessee was not bonafide, the Tribunal deleted the penalty imposed under Section 271(1)(c) of the Act. The revenue has not been able to point o....