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2017 (2) TMI 175 - AT - Income TaxExemption u/s 54F - addition towards consideration for unsold flats - penalty proceedings u/s 271(1)(c) initiated - Held that:- We find that the assessee had admitted income in respect of development agreement as soon as she came to know that she had to pay tax on development agreement which cannot be termed as concealment of particulars of income, more particularly when she is an illiterate lady not assessed to income tax in the earlier period. The matter would have been different if she had assessed to income tax regularly and filed her return of income for these assessment years under regular provisions of the Act and not admitted capital gains in respect of development agreement in the returns filed for those years. But, the fact is that the assessee is not assessed to income tax and also fact that she had admitted income and filed her return of income disclosing resultant capital gains in pursuance to development agreement and paid taxes, therefore, admission of assessee cannot be considered as concealment of particulars of income or furnishing inaccurate particulars of income. Though there is a slight difference in income admitted by the assessee and income determined by the A.O. for the assessment year 2007-08, this is because of disallowance of exemption claimed u/s 54F towards 4 flats retained by her, which was further supported by case of CIT Vs. K.G. Rukminiamma [2010 (8) TMI 482 - Karnataka High Court] which was followed by the Hon’ble High Court of Andhra Pradesh in the case of CIT Vs. Syed Ali Adil (2013 (6) TMI 278 - ANDHRA PRADESH HIGH COURT). Therefore, we are of the view that there is neither concealment of income nor furnishing inaccurate particulars of income, which warrants levy of penalty u/s 271(1)(c) of the Act. Hence, penalty levied by the A.O. u/s 271(1)(c) of the Act for all the assessment years 2007-08 to 2009-10 is not sustainable, even on merits. - Decided in favour of assessee.
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