2012 (1) TMI 346

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....nds of appeal:  "1.  That the Ld. CIT(A)-II, Ludhiana has erred in confirming the penalty amounting to Rs. 61,614/- imposed by the Assessing Officer u/s 271(1)(c) of the Income Tax Act,1961. 2. That the penalty u/s 271(1)(c) has been confirmed by the Ld. CIT(A) against the facts and circumstances of the case and submissions made by the appellant has not been considered properly. 3. That the ld. CIT(A) has also not considered the fact that deduction u/s 54F was claimed on the basis of computation worked out by the Assessee's counsel and assessee cannot be penalized for the mistake of the counsel, especially when full particulars of the income/capital gain were given in the return and nothing was concealed." 3. The only ....

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.... the assessee. The Assessing Officer also initiated penalty proceedings u/s 271(1)(c) of the Act. During the penalty proceedings the explanation of the assessee was that he was not aware of the income-tax law and had acted on the advice of his counsel in claiming the said deduction under section 54F of the Act. The Assessing Officer rejecting the explanation of the assessee levied penalty of Rs. 61,614/- u/s 271(1)(c) of the Act. 5. The CIT (Appeals) upheld the levy of penalty u/s 271(1)(c) of the Act. 6. The assessee is in appeal against the aforesaid levy of penalty u/s 271 (1) (c) of the Act. The learned A.R. for the assessee reiterated its submissions made before the Assessing Officer during the assessment proceedings and pointed ....

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.... and in view of the exemption provided under section 54F of the Act claimed the exemption to the extent of Rs. 9,75,020/- i.e. the long term capital gain computed in the case and declared the income under the said head at nil. However, exemption under section 54F of the Act is in relation to the cost of net consideration realized on sale of old asset and since the cost of new asset being the residential house was lesser than the same, the assessee was entitled to prorata deduction totaling Rs. 7,99,516/-. Consequently, the addition of Rs. 1,75,484/- in the present case was made by the Assessing Officer. 9. The claim of the assessee is that it had bonafidely acted on the advice of his counsel and made the aforesaid investment, under the b....