2024 (12) TMI 32

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....has claimed exemption u/s. 54F of Rs. 18,38,442/-. The ld. AO on perusal of the computation of income, noted that assessee had shown income from house property from two properties, thus, he inferred that once the assessee owns two residential properties and the income of both the properties have been offered by the assessee in the return, therefore, in terms of Section 54F, assessee is not entitled for the claim of exemption from capital gains u/s. 54F. 4. In response to the show-cause notice assessee stated as under:- "The property at Flat 1501, Dream Wings is received by assessee Mr. Prathamesh Khot on the death of his mother Late Smt. Veena Vivek Khot through WILL and is not purchased by the assessee. The property at Regency Nirman Lt....

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....inheritance from my mother on her demise, which is not purchased by me. The other house is purchased by me along with my father Mr.Vivek Khot. The demand arises due to interpretation of Law with regards to section 54F and it is not intentional misreporting or under reporting of income. I have accepted the stand taken by the AQ and has paid the necessary tax along with interest as per the notice of demand u/s 156 Key details for Immunity from Imposition of Penalty u/s 270A Sr. No. Particular Particular 1 Returned Income 29,66,890 2 Assessed Income as per order dated 07.04.2021 48,05,332 3 Date of Notice of Demand 07.04.2021 4 Amount of Tax demand 5,30,372 5 Details of Payment of Tax as mentioned below 5,30,372 &n....

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....led out from the records, it is seen that assessee had received one flat through inheritance from his late mother and was not purchased by him. The other property was purchased by him alongwith his father. This fact was duly stated before the ld. AO as well as was also reported in the computation of income. The claim of exemption u/s. 54F is available to an individual from the transfer of long term capital asset and assessee had purchased a residential house in India. The proviso to section 54F states that the exemption shall not be available if the assessee owns more than one residential house other than new asset on the date of transfer of original asset. The assessee did not have any house in his own name and had received on the demise o....

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....rting of income. If ld. AO is levying the penalty by invoking Section 270A (9), then it is incumbent upon the AO to specify under which limb of Section 270A (9) he is initiating or is levying the penalty for misreporting of income. Penalty u/s 270 A is not automatic or adjunct to any addition made by the AO. Misreporting has to be established and onus is on the AO to give finding as how it amounts to misreporting under the clauses of sub section (9) of section 270A. Accordingly, on these facts when assessee had duly stated all the facts and stated that he was under a bonafide belief that the only property which he has purchased in his name (alongwith his father) on transfer of capital asset was the only property which was owned by him, and ....