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2020 (3) TMI 174 - AT - Income TaxPenalty u/s 271(1)(c) - mistake of wrong classification of the securities yielding Long Term Capital Gain and consequently the assessee had paid the tax @ 10% instead of 20% - AO was of the view that the assessee being a NRI and well educated and having availed of the services of a qualified professional, cannot take the plea of inadvertent mistake or error. HELD THAT:- When the return was filed through the Tax Consultant then it is only a matter of misclassification of the capital asset sold by the assessee which has resulted into short payment of tax. Therefore, in the facts and circumstances of the case, we find that it is a case of inadvertent and bona fide mistake of wrong classification of the securities yielding Long Term Capital Gain and consequently the assessee had paid the tax @ 10% instead of 20%. Except the classification of securities, all other necessary and relevant particulars/ details furnished by the assessee are not in dispute. Therefore, the said classifications of the asset is nothing but a mistake occurred while filing the return of income by the Tax Consultant of the assessee and accordingly the same falls in the ambit of reasonable and bona fide explanations/ reasons for the default/ failure on the part of the assessee. Once the assessee has explained the reasons for wrong classification of the securities and the said explanation of the assessee is bona fide being inadvertent mistake on the part of the Tax Advisor then this case would not fall in clause B of Explanation 1 to Section 271(1)(C) of the Act. Thus no penalty shall be levied u/s 271(1)( c) of the Act in view of the decision of Hon'ble Supreme Court in the case of Price Waterhouse Coopers Pvt. Ltd vs CIT [2012 (9) TMI 775 - SUPREME COURT] - Decided in favour of assessee.
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