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TMI Blog2012 (11) TMI 425X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s 271 (1) (c) of the Act by AO on addition of Rs. 23, 05,136/- made on account of computation of Long Term Capital Gains on sale of property simply on the basis of estimate, surmises and conjectures. The addition being without any merits and justification is pending for adjudication before the Hon'ble ITAT. Both the lower authorities have failed to appreciate the fact that the Appellant has neither furnished inaccurate particulars nor concealed any income. The penalty levied being without any merits and justification requires to be quashed. The appellant craves leave to add, amend, alter, edit, delete, modify or change all or any of the grounds of appeal at the time of or before the hearing of the appeal." 2. The only ground raised by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nfirmed by the CIT(A). It is not necessary to prove mens rea before levy of penalty u/s.271(l)(c) of the Act, since the penalty under the said section is a civil liability. Reliance in this respect is placed on the decision of Hon'ble Supreme Court in the case of UOI & Ors. vs. Dharamendra Textile Processor & Ors. reported in 306 ITR 277. 2. On the facts and in the circumstances of the case and in law, the CIT(A) ought to have upheld the order of the Assessing Officer since the assessee has failed to disclose his true income." 3. Brief facts till the stage of levy of penalty by the A.O. are noted by Ld. CIT(A) in para 4 & 5 of his order, which are reproduced below: "4. As would be seen, as against the appellant's declaration of a long t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the long term capital gains. The present penalty has been .levied thereafter. In levying the penalty, the Assessing Officer has dealt with all the four objections raised by the assessee. Since these objections in content are more or less the same before me, these shall be discussed further later. The Assessing Officer came to the conclusion that it was a deliberate attempt by the assessee to furnish in accurate particulars of income with the result to under assess his income and therefore assessee is liable for penal proceedings u/s.271(l)(c). Consequently, he levied the penalty at the minimum level Rs.7,26,118/-." 4. Being aggrieved, the assessee carried the matter in appeal before Ld. CIT(A) who has deleted the penalty in part for which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on account of indexed cost of acquisition is deleted, the resultant capital gain / loss will be loss only. He further pointed out that although the A.O. computed the share of the assessee's capital gain at Rs.23,05,136/- as against the amount of capital loss declared by the assessee in the return of income at Rs.13.83,666/- but the penalty is imposed by him only on the positive income of capital gain assessed by the A.O. at Rs.23,05,136/- and no penalty is imposed by the A.O. in respect of capital loss declared by the assessee which was not allowed by the A.O. It was his submission that since after the tribunal order in quantum proceedings, there will be no positive capital gain, no penalty is justified. 5. We have considered the rival sub ..... X X X X Extracts X X X X X X X X Extracts X X X X
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