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2019 (3) TMI 1262 - AT - Income TaxPenalty u/s 271(1)(c) - income admitted by the assessee and surrendered to tax as undisclosed income during the search and seizure action - assessee filed return of income U/s 139(1) - assessee contented that income disclosed in the return of income filed U/s 139(1) of the Act, though the same was claimed as exempt U/s 10(38) of the Act, therefore, it is not a case of concealment of particulars of income or furnishing inaccurate particulars of income - long term capital gain was already declared in the original return of income filed U/s 139(1) and was also duly recorded in the books of account - HELD THAT:- In the case in hand when the assessee already furnished return of income before the date of search and also declared long term capital gain then none of the conditions as prescribed under clause (a) & (b) are satisfied so as to bring the case of the assessee in the mischief of Explanation 5A to Section 271(1)(c) of the Act. The transaction of purchase and sales are not off market but at the floor of the Stock Exchange which can be duly verified from independent source without any influence of the assessee. Hence, the documents produced by the assessee are the evidence which cannot be manipulated and also can be verified from the independent sources. Once the assessee has produced all these documents to establish the genuineness of purchase and sale of transactions of shares through Stock Exchange than the mere disclosure and surrender of income would not lead to the conclusion that the assessee has concealed the particulars of income or furnished inaccurate particulars of income. If the transactions are accepted as genuine and are already declared in the return of income filed U/s 139 as well as duly recorded in the books of account then long term capital gain arising from the sale of listed shares is exempted U/s 10(38) of the Act. The withdrawal of claim of exemption by the assessee in the statement U/s 132(4) of the Act, ignoring the supporting evidence of genuineness of the claim, would not ipso facto amount to concealment of income or furnishing inaccurate particulars of income. It is undisputed fact in this case that the impugned income subjected to the assessment is only income which is surrendered by the appellant during the search and also disclosed in return of income filed under section 153A. There is no corroborative evidence/material /document in support of income so surrendered and offered for taxation and the same is only on the basis of the statement of the assessee recorded during search. The declared income is also finally assessed as such. Thus the penalty levied on this account under section 271(1)(c) is not sustainable and accordingly the same stands as cancelled. See AJAY TRADERS VERSUS THE DCIT, CENTRAL CIRCLE, ALWAR [2016 (6) TMI 422 - ITAT JAIPUR] - Decided in favour of assessee
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