AI Drafter 
TaxTMI 
TaxTMI 
2021 (8) TMI 503
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....of penalty order passed under s. 271(1)(c) of the Income Tax Act, 1961 (here-in-after referred to as "the Act"). The assessee has filed the Cross Objection in the Revenue's appeals bearing ITA no. 2072/AHD/2018 for the Assessment Year 2014-2015. 2. The Revenue has raised the following grounds of appeal: 1. That under the facts and circumstances of the case, the Ld. C1T(A) has erred in law and on facts in deleting the penalty levied u/s 271(1)( c) of the I.T. Act amounting to Rs. 77,24,050/- . 2. The Ld. CIT(A) has erred in law and on facts by not appreciating that as per Section 5 of the I.T. Aet, 1961 Capital Gain is to be taxed on accrual basis 2.1 The Ld.CIT(A] has erred in law and on facts by not appreciati....
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....see has earned capital gain income of Rs. 3,74,95,382/- which was not disclosed in the income tax return. 4.1 On question by the AO, the assessee claimed that he received the consideration in the Financial Year 2015-16 against the sale of property. Therefore he was under the impression that the same was to be offered to tax in the Assessment Year 2016-17. However, the AO disregarded the contention of the assessee and made the addition of Rs. 3,74,95,380/- to the total income of the assessee. The AO in the Assessment Proceedings initiated penalty proceeding u/s 271(1)(c) of the Act for furnishing inaccurate particulars of income which came to be confirmed by the AO in the penalty order dated 28/07/2017 for Rs. 77,24,050/- being 100% amoun....
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....s.271(1)(c)of the Act is deleted. 3. In the result, the appeal is allowed. 6. Being aggrieved by the order of the LD. CIT(A) the Revenue is in appeal before us 7. Both the Ld. D.R and Ld. AR relied on the order of the authorities below as favourable to them. 8. We have heard the rival contentions of both the parties and perused the materials available on record. The assessee in the year under consideration has transferred the property but failed to offer the corresponding capital gain on such property amounting to Rs. 3,74,95,382/- in the income tax return. On question by the AO, the assessee accepted the same. The AO, subsequently levied penalty under section 271(1)(c) of the Act for an amount of Rs. 77,24,049/- on accoun....
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.... money was received. Accordingly, the contention of the assessee that he was ignorant to the provisions of law will be of no assistance. 8.3 Now the controversy arises whether the assessee has concealed the particulars of income by not disclosing the capital gain in the income tax return. The scheme of section 271(1)( c) of the Act visualizes situations to levy penalty in the manner as detailed below: i. The assessee has concealed income or ii. The assessee has furnished inaccurate particulars of income. iii. In addition to these two situations, penalty can also be imposed, inter alia, when assessee is deemed to have concealed particulars of income under Explanation 1 to section 271(1)(c) of the Act. This expla....
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....r was ambivalent regarding under which head the penalty was being imposed namely for concealing the particulars of income or furnishing inaccurate particulars, we may record that though in the assessment order the Assessing Officer did order initiation of penalty on both counts, in the ultimate order of penalty that he passed, he clearly held that levy of penalty is sustained in view of the fact that the assessee had concealed the particulars of income. Thus insofar as final order of penalty was concerned, the Assessing Officer was clear and penalty was imposed for concealing particulars of income. In light of this, we may peruse the decision of this Court in case of Manu Engineering Works (supra). In the said decision, the Division Bench c....
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..... 8.8 In the light of the above stated discussion, we see the case on hand. It is noticed that the AO in the penalty order has levied the penalty under both the charges i.e. concealment of particulars of income and furnishing inaccurate particulars of income. The relevant finding of the AO is extracted as under: In the instant case assessee has concealed particulars of his income to reduce the income. In view of the above, the undersigned is left with no other option but to levy the penalty u/s 271(1)(c) of the Act, 1961. XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX In view of the discussion made in above paras, I am of considered view that the assessee has furnished inaccurate ....