TaxTMI 
TaxTMI 
TaxTMI 
2019 (3) TMI 1061
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....lained to the Assessing Officer that these deposits pertained to sale proceeds of the agricultural land sold by the assessee. The assessee filed copy of sale deed which showed sale of total land measuring 11 acres to M/s Sutluj Real Estate (P) Ltd. and M/s Kanchanjunga Realtors (P) Ltd. on 24.04.2006 for a consideration of Rs. 8,61,50,000/-. The land was said to be situated in Village Azizullapur, Tehsil Panipat. It was the assessee's claim that the land sold was situated beyond 8 Kms from the municipal limits and as such it was not a capital asset in terms of section 2(14) (iii) of the Act. In support, the assessee furnished a copy of letter issued by Tehsildar, Panipat. However, the Assessing Officer, through his office, collected information of another piece of land situated in the same village in the case of another assessee from the office of the District Town Planning Officer, Panipat who, as per letter No. 2193 dated 31.12.2007, informed that the distance of the land was approximately 1.8 kms from the extended municipal boundary of Panipat. The Assessing Officer went on to hold that the land sold by the assessee was a 'capital asset' within the meaning of section 2(14)(ii) ....
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.... gains tax on the basis of this certificate only. It was further submitted that the certificate of the District Town Planning Officer, based on which the Assessing Officer had made the disallowance, mentioned that the impugned land was 1.8 Kms from the extended municipal limits and, thus, there was a difference of opinion between the Tehsildar and the District Town Planning Officer. He also drew our attention to copy of 'Jamabandhi' of the impugned land placed on record and pointed out that as per the 'Jamabandhi', the nature of land was agricultural. The Ld. AR further submitted that the penalty had been wrongly imposed and wrongly upheld by the lower authorities for furnishing inaccurate particulars of income although it was very much evident that it was not a case of filing of inaccurate particulars of income. It was submitted that all the relevant details were filed before the Assessing Officer and no inaccurate particulars had been furnished by the assessee. It was submitted that it is a different issue that the claim of the assessee was not accepted because the assessee relied on one certificate from the Tehsildar whereas the Assessing Officer placed reliance on another certi....
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....as the question has to be considered from a different angle. It is important to keep in mind the fundamental legal proposition that Assessment proceedings are not conclusive. Assessment proceedings and penalty proceedings are separate and distinct. Findings in Assessment proceedings don't operate as res judicata in penalty proceedings. For this proposition reliance is placed on the decision in CIT vs. Dharamchand L. Shah (1993) 204 ITR 462 (Bom). In Vijay Power Generators Ltd vs. ITO (2008)6 DTR 64 (Del) it was held that "It is well settled that though they constitute good evidence do not constitute conclusive evidence in penalty proceedings." During penalty proceedings, there has to be reappraisal of the very same material on the basis of which the addition was made and if further material is adduced by the assessee in the course of the penalty proceedings, it is all the more necessary that such further material should also be examined in an attempt to ascertain whether the assessee concealed his income or furnished inaccurate particulars. Thus, under penalty proceedings assessee can discharge his burden by relying on the same material on the basis of which assessment is made by ....
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.... in conjunction, they must mean the details supplied in the return, which are not accurate, not exact or correct, not according to truth or erroneous. The court noted that it was an admitted position that no information given in the return was found to be incorrect or inaccurate. It was not as if any statement made or any detail supplied was found to be factually incorrect and accordingly, held that, prima facie, the assessee could not be held guilty of furnishing inaccurate particulars. The court repelled the contention raised by the counsel for the revenue that "submitting an incorrect claim in law for the expenditure on interest would amount to giving inaccurate particulars of such income". The court held that in order to expose the assessee to the penalty unless the case is strictly covered by the provision, the penalty provision cannot be invoked. By any stretch of imagination, making an incorrect claim in law cannot tantamount to furnishing inaccurate particulars. Therefore, it is obvious that it must be shown that the conditions under section 271(1)(c) must exist before the penalty is imposed. The court further observed that there can be no dispute that everything would depe....