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2016 (7) TMI 740 - AT - Income TaxPenalty under Section 271(1)(c) - sale of agricultural land - as per assessee capital gain arising on sale of agricultural land located at a village in Goa was exempt as the agricultural land did not constitute ‘capital asset’ which was liable to capital gain tax - Held that:- This fact is not denied that the land was situated in a village. Further, this fact is also not denied that the impugned land is described as agricultural land in the land records maintained with the local authorities. This fact is also not denied that the assessee belonged to a rural background and he is not well educated. The assessee apparently acted on the advice of other persons, who were indeed not competent enough to advise the assessee. These facts have nowhere been denied by the AO or Ld. CIT(A). The conduct of the assessee has been such that the moment he came to know that agricultural land may be situated within 8 kms of the municipal limits, and therefore, it may not be exempt from income-tax, he immediately revised the return of income and paid tax thereon. Although, the assessee withdrew the claim and paid taxes, the precise location of land and its distance from the municipal limit is still unknown. During the penalty proceedings also nothing was brought on record by the AO to prove that the claim of the assessee was false and distance of the land was actually less than 8 kms from the municipal limits. This facts still remains under shadow of doubts. During the penalty proceedings also, nothing was brought on record by the AO to prove that the claim of the assessee was false and distance of the land was actually less than 8 kms. The addition has been made solely relying upon the revised computation sheet filed by the assessee. In the given circumstances, we find that it cannot be said that the claim was not bonafide at all.The only reason for disallowing the claim was the possibility of its location within the 8 kms radius of the municipality. The exact answer to this question is not available on record. Under these circumstances, the addition itself remains under the shadow of doubts. Under these circumstances, we do not find it to be a case of concealment of income or furnishing of inaccurate particulars of income, and thus not fit for levy of penalty. - Decided in favour of assessee
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