TMI Blog2013 (11) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... ,604/-) of the land sold during the relevant year was a mistake and was not done with a mala fide intention to evade tax. Assessing Officer imposed the penalty after adopting the prescribed procedure under the law @ 300% and the same was confirmed by learned First Appellate Authority. Explanation filed by the assessee state that the overstatement of cost of acquisition of the land sold during the relevant year was the mistake of his accountant - Therefore, penalty @ 300% is very much on higher side on account of mistake committed by the assessee's accountant - The assessee has not produced any evidence supporting the mistake of his accountant - assessee has filed inaccurate particular of income to evade the tax due and has also admitted before the Assessing Officer that overstatement of cost of acquisition of the land sold during the relevant year was a mistake of his accountant - Penalty reduced to 100% - Decided partly in favour of assessee. - I.T.A. No. 106 (Asr)/2010 - - - Dated:- 11-6-2013 - H. S. Sidhu And B. P. Jain, JJ. For the Appellant : Sh. K. R. Jain, Advocate For the Respondent : Sh. Tarsem Lal, D. R. ORDER Per Bench 1) The assessee has fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in this property is further confirmed from the sale deed in which the same share has been sold. The Assessing Officer further noticed that the assessee had purchased this property on 29.05.1998 whereas while computing capital gain, it has been mentioned to be purchased in the year 1991-92 and thus has computed capital gain by taking the cost inflation index of the year 1991-92. The Assessing Officer pointed out these discrepancies to the assessee but the assessee did not tender any explanation in this regard. As such, long term capital gain is worked out as under by taking the cost of acquisition at ₹ 70,078/- and cost inflation index of the year 1998-99 which is 351. Sale consideration 12604166.00 Less: Cost of acquisition in 1998-99 70078 X 497/351 99227.00 Cost of acquisition in 1996-97 250000 X 497/305 407377.00 506604.00 12097562.00 Less: B/F Long term capital loss A.Y. 2005-06 16239.00 4 Balance Long Term Capital Gain 12081323.00 3) The assessee has declared long ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roperty which comes to ₹ 70,078/- whereas he showed the entire amount mentioned in the purchase deed at ₹ 2,80,312/- as a cost. Further, the purchase deed was executed on 29.05.1998 and as such, the cost inflation index for the financial year 1998-99 was applicable to work out the long term capital gains whereas the assessee applied the cost inflation index for the financial year 1991-92. The assessee has tried to fabricate evidence by producing a concocted copy of alleged agreement dated 10.03.1992, as the alleged agreement was not found to be registered anywhere and also that the sale deed was shown to have been executed after a gap of more than 6 year which is obviously an unbelievable gap. The fabrication of evidence is confirmed from the fact that the counsel for the assessee did not mention the alleged agreement in the reply to penalty proceedings. 5) In view of the above discussion and facts, the Assessing Officer has held that there is no doubt that the assessee has clearly furnished inaccurate particulars of his income to the extent of suppression of long term capital gains at ₹ 6,00,849/-. Assessee himself has admitted the mistake in his reply in resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of Hindustan Steel Ltd. Vs. State of Orissa; Copy of Judgment of Punjab Haryana High Court in the case of CIT Vs. Punjab Kesari Hosiery Factory (2008) 304 ITR 247 (P H); Copy of Judgment of Punjab Haryana High Court in the case of Vishwakarma Industries Vs. CIT-I, Asr; Copy of I.T.A.T. (Lucknow Bench) in the case of Star International P. Ltd. Vs. ACIT [2009] 308 ITR (AT) 33, Lucknow; Copy of Judgment of Supreme Court in the case of CIT Vs. Poddar Cement Pvt. Ltd. Others; Copy of Judgment of Punjab Haryana High Court in the case of CIT Vs. Sidhartha Enterprises (2010) 322 ITR 80; Copy of Judgment of Punjab Haryana High Court in the case of CIT, Bathinda Vs. M/s Shere Punjab Agricultural Works; Copy of Judgment of Punjab Haryana High Court in the case of CIT Vs. SSP(P) Ltd. [2008] 219 CTR (P H) 486 and Copy of Judgment of Punjab Haryana High Court in the case of CIT Vs. Rubber Udyog Vikas P. Ltd. [2011] 335 ITR 558 (P H). 9) Learned D.R. relied upon the impugned order passed by learned CIT(A), Bathinda, dated 24.12.2009 and stated that the assessee had taken full share instead of 1/4th share and also claimed the year of acquisition as 1991-92 instead of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... initiated the penalty proceeding separately against the assessee under Section 271(1)(c) of the Act for furnishing inaccurate particular of assessee's income. The Assessing Officer issued penalty notice dated 28.12.2007 under Section 274 read with Section 271(1)(c) of the Act to the assessee and assessee filed his reply by stating that he had filed an appeal before the learned CIT(A) against the quantum and requested for keeping the proceeding pending. As another opportunity, the Assessing Officer, after the final decision of appeal filed by the assessee before the learned CIT(A), Bathinda, again issued notice to the assessee on 05.06.2008 under Section 274 read with Section 271(1)(C) of the Act and the assessee submitted his written explanations wherein it was admitted that the overstatement of cost of acquisition (Rs. 11,07,453/- instead of ₹ 5,06,604/-) of the land sold during the relevant year was a mistake and was not done with a mala fide intention to evade tax. After considering the written submission filed by the assessee, the Assessing Officer has held that the assessee has clearly furnished inaccurate particulars of his income to the extent of suppression of lo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the law @ 300% and the same was confirmed by learned First Appellate Authority. 13) Keeping in view the facts and circumstances of the present case along with the explanation filed by the assessee that the overstatement of cost of acquisition of the land sold during the relevant year was the mistake of his accountant, we are of the view that penalty @ 300% is very much on higher side on account of mistake committed by the assessee's accountant. 14) The assessee has not produced any evidence supporting the mistake of his accountant. Taking lenient views, we reduce the penalty imposed by the Revenue Authority in the impugned order to 100% from 300% of the tax sought to be evaded in the present case. We are of the view that the assessee has filed inaccurate particular of income to evade the tax due and has also admitted before the Assessing Officer that overstatement of cost of acquisition of the land sold during the relevant year was a mistake of his accountant. 15) As per the record available with us this is a fit case for reducing the penalty to @ 100% from 300%. It is clear case for imposing penalty because the assessee has suppressed his income. Thus, we direct the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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