Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2023 (3) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (3) TMI 1224 - ITAT KOLKATAPenalty u/s 271(1)(C) - rent paid by the developer on behalf of the assessee for alternative accommodation during the development period - AO noticed that rent was paid by the developer on behalf of assessee for alternative accommodation for the development period and the said income was not considered by the assessee at the time of filing of return of income as he thought that the said amount directly paid by the third party by the developer and the ld. AO added the amount in the hands of assessee HELD THAT:- As considering the co-ordinate bench judgement in the case of Smt. Delilah Raj Mansukhani [2021 (3) TMI 252 - ITAT MUMBAI] as held that compensation received by the assessee towards displacement in terms of development agreement is not a revenue receipt and constitute capital receipt in the hands of assessee as the property has gone into re-development - we set aside the findings of the ld. CIT(A) on this issue and direct the AO to delete the addition - Accordingly, the ground is allowed. Penalty u/s 271(1)(c) we find that in the case of assessee, AO cannot impose penalty on the sum being rent paid by the developer on behalf of the assessee for alternative accommodation during the development period as the amount paid by the developer to the assessee could not be taxed in the hands of land owner/assessee in terms of the above order. Therefore, the initiation of penalty proceeding itself is bad in law. In such a situation impugned order passed by the ld. CIT(A) cannot be sustained, accordingly, we set aside the same and delete the penalty imposed by the AO. Appeal of the assessee is allowed.
|