2017 (7) TMI 305

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....ile the petition in time. Considering the prayer the one day delay in filing the appeal is condoned and appeal is admitted. 2. Briefly stated, Assessee is an individual, and has filed return of income admitting total income of Rs. 4,49,790/-. Assessee has income from salary, income from house property and income from other sources. Assessee also has declared short term capital gain of Rs. 43,917/- which was set off to carry forward short term capital loss. A.O while assessing the total income at the same amount of declared income of Rs. 4,49,790/-, however, recalculated the short term capital gains on the basis of the details furnished by Assessee. Without giving the details of the short term gains and how shortage was worked out, A.O ha....

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....rming the penalty of Rs. 1,10,000/- levied u/s 271(1)(c) of the IT Act is not correct either on f acts or in law and in both. 2. The learned f irst appellate authority failed to appreciate the f act that since the appellant had sufficient brought forward losses the addition to short term capital gains has no bearing on tax liability and hence the understatement of short term capital gain could have been accepted as an accounting mistake only. 3. The learned f irst appellate authority failed to appreciate the f act that the appellant had not intention to avoid any legitimate taxes. 4. The appellant craves for leave to add or amend or alter any of the grounds at the time of hearing of appeal." 5. In the present p....

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....the order as an oversight by Assessee and the difference was brought to tax. Nowhere in the order, how the same was computed was specified. As seen from the grounds before CIT(A), Assessee states that the difference arose due to adoption of a different cost of acquisition as on 01-04- 1981. If that is to be considered, certainly the computation would be under the head 'long term capital gain' but not under 'short term capital gain'. Obviously there seem to be some mistake, either in the computation by A.O or in the submission of Assessee before CIT(A). Be that as it may, we are of the opinion that penalty u/s 271(1)(c) of the IT Act cannot be levied on the facts of the case. 9. Provisions of Sec. 271(1)(c) are applicable only when, if A.....

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....between the tax on the total income assessed and the tax that would have been chargeable had such total income been reduced by the amount of income in respect of which particulars have been concealed or inaccurate particulars have been furnished." 9.1 Thus in the case of concealment of income or furnishing of inaccurate particulars of income, the expression "the amount of tax sought to be evaded has to be calculated either in under (a) or under (b) or under (c)." As can be seen from the facts of the case, Assessee has not furnished any loss return, therefore, the effect of reducing the loss declared in the return or converting that loss into income under Clause-(a) does not arise. This is not a case where explanation-3 has been invoked, ....