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2015 (8) TMI 861 - AT - Income TaxPenalty u/s. 27(1)(c) - conversion of business loss into capital loss and in adoption of higher rate for shares sold - Held that:- As referred to by the learned AR, ITAT Ahmedabad “B” Bench for AY 2004-05 in the case of Ergon Investments & Finance (P) Ltd. [2011 (10) TMI 581 - ITAT AHMEDABAD] has decided same issue(i. e., computation of capital gain on the sale of shares of “Market creators Ltd.”, on the basis of actual consideration received and not on the basis of alleged market value), in favour of the assessee relying on the decision of the case of Allure Investments & Finance (P) Ltd. for AY 2004-05 [2011 (8) TMI 1085 - ITAT AHMEDABAD] wherein held that for the computation of capital gain in the present case, the A.O. shall work out the capital gain/capital loss on the basis of consideration received by the assessee and not on the basis of alleged market value of the shares sold by the assessee. Considering the facts of the case and the above discussions, though the assessee has not preferred any quantum appeal, we do not find it appropriate to levy of penalty because, on identical facts of computation of capital gain on the sale of shares of “Market creators Ltd.”, on the basis of actual consideration received ie., @ ₹ 0.26 per share and not on the basis of alleged market value, it has been decided by the Tribunal in favour of the assessee on an earlier occasion in another assessee’s case mentioned supra. - Decided in favour of assessee.
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