TaxTMI 
TaxTMI 
2021 (6) TMI 934
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....ourse of assessment proceedings, the assessee was required to explain that since the value for stamp duty purposes was Rs. 57,52,000/-, therefore, why should not the Long Term Capital Gain be calculated in view of the provisions of section 50C of Income Tax Act. The assessee responded to the query raised by the Assessing Officer (AO) but being unsatisfied with her reply, income from Long Term Capital Gain was calculated by the AO at Rs. 44,51,779/. The assessee accepted the AO's contention and furnished a fresh computation of capital gains and then claimed exemption u/s 54F of the Act by showing investment of Rs. 53,24,544/- in residential plot at Village Kyarkuli, near Mussoorie. Again dissatisfied with the reply tendered during the assessment proceedings it, was held by the AO that the assessee had made a bogus claim for exemption u/s 54F and that she could not substantiate her claim with evidences. The AO, accordingly, computed the Income from Long Term Capital Gain at Rs. 49,29,337/-. 2.1 Aggrieved, the assessee preferred an appeal before the Ld CIT (A) who, vide order dated 26.02.2013, confirmed the addition made in the assessment. 2.2 During course of original assessment p....
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....he Act in her returned of income itself. In these circumstances, the case of appellant does not fall either in the category of "Concealment of Income" or in the category of furnishing "Incorrect Particulars of Income". Therefore, the initiation of penalty u/sec.271(1)(c) of the Act was invalid in law. The same was not appreciated by the Hon'ble CIT(A) while upholding the erroneously the impugned penalty u/sec. 271(1)(c) of the Act. 4. That on the facts and in the circumstances of the case the Hon'ble CIT(A) has erred in law in rejecting the claim of deduction u/sec.54 of the Act merely on suspicion and surmises without appreciating that the impugned property at Mauja, Kyarkuli Bhatta Pargana , Tehzil and Distt. Dehradun purchased by the appellant within period of 2 years 9 months from the date of sale of Land at Noida sold on 18.02.2009 comprising land and a tin shed already constructed thereon which itself is composite house property which qualifies for the deduction u/sec.54 of the Act. 5. That on the facts and in the circumstances of the case the Hon'ble CIT (A) of misrepresentation of the facts of the case by the appellant for alleged dubious claim of deduction u/sec.54 o....
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....at the defect in notice would make the imposition of penalty unsustainable in law. 4.0 Per contra, the Ld. Sr. Departmental Representative (DR) placed extensive reliance on the observations and findings of both the Lower Authorities. 5.0 We have heard the rival submissions and have given thoughtful consideration to the orders of the authorities below. The Ld. AR for the assessee has challenged the impugned order contending that show-cause notice issued by the AO is not a valid notice to initiate the penalty proceedings as the assessee has not been made aware as to whether she has concealed the particulars of income or has furnished inaccurate particulars of such income. We find that vide notice u/s 274 vide dated 26.12.2011, the AO had issued the show cause as under (copy enclosed at page 19 of paper book): "WHEREAS during the course of assessment proceedings in your case for the Assessment Year 2009-10, it was found that you have: Concealed the particulars of your income and / or furnished inaccurate particulars of such income. AND WHEREAS, you have rendered yourself liable for imposition of penalty under sec. 271(1)(c) of the I.T. Act, 1961. NOW THEREFORE, you are requi....
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....e qua non for the Assessment Officer to initiate the proceedings because of the deeming provision contained in Section 1(B). h) The said deeming provisions are not applicable to the orders passed by the Commissioner of Appeals and the Commissioner. i) The imposition of penalty is not automatic. j) Imposition of penalty even if the tax liability is admitted is not automatic. k) Even if the assessee has not challenged the order of assessment levying tax and interest and has paid tax and interest that by itself would not be sufficient for the authorities either to initiate penalty proceedings or impose penalty, unless it is discernible from the assessment order that, it is on account of such unearthing or enquiry concluded by authorities it has resulted in payment of such tax or such tax liability came to be admitted and if not it would have escaped from tax net and as opined by the assessing officer in the assessment order. l) Only when no explanation is offered or the explanation offered is found to be false or when the assessee fails to prove that the explanation offered is not bonafide, an order imposing penalty could be passed. m) If the explanation offered, even thou....