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2015 (3) TMI 616 - BOMBAY HIGH COURT

2015 (3) TMI 616 - BOMBAY HIGH COURT - TMI - Penalty u/s 271(1)(c) - assessee had claimed the Receipt of ₹ 1.11 crore as capital receipt in order to evade tax - Tribunal upholding the decision of the CIT(A) in deleting the penalty - Held that:- The respondent-assessee had originally paid an amount of ₹ 54 Lakhs as a consideration for the development agreement in 1995. In the previous year relevant to assessment year, the respondent-assessee received from the vendor an amount of ͅ .....

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ng taxable was filed along with the Return of Income. Thus there has been a complete disclosure of all facts as held by CIT(A) and the Tribunal. Besides the claim made by the respondentassessee of not being taxable was not found to be not bonafide. As held by the Supreme Court in Reliance Petroproducts Pvt. Ltd. (2010 (3) TMI 80 - SUPREME COURT ) making of an incorrect claim would not tantamount to furnishing inaccurate particulars of income. In this case, the assessee bonafide believed that the .....

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e Respondents : Mr K Gopal & Mr Jitendra Singh, Adv. ORDER P.C. This appeal by the Revenue under Section 260A of the Income Tax Act, 1961 challenges the order dated 22 July 2012 passed by the Income Tax Appellate Tribunal (the 'Tribunal'). By the impugned order, the Tribunal dismissed the revenue's appeal from the order dated 20 June 2011 passed by the Commissioner of Income Tax (Appeals) (the 'CIT (A)') deleting a penalty of ₹ 13.30 Lakhs imposed under Section 271( .....

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e of the case, the Tribunal failed to appreciate that the fact of the case are squarely covered by the facts of the case of CIT Vs. Zoom Communication Pvt. Ltd. 327 ITR 510 " 3. The respondentassessee had on 27 January 1995 entered into a Development Agreement with the owners of land at Pune by paying a consideration of ₹ 54 Lakhs. During the previous year relevant to the subject Assessment Year 200506 the aforesaid agreement dated 27 July 1995 was canceled and the owners of the land .....

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The Assessing Officer did not accept the contention of the respondentassessee and held that the receipt to be taxable under the head of Capital Gains and after allowing expenses brought to the tax an amount of ₹ 69.92 Lakhs as Capital Gains. The respondentassessee being aggrieved with the order of the Assessing Officer agitated the matter before the CIT (A) but without any success. Thereafter, the respondentassessee accepted the finality of the order passed by the Assessing Officer bringi .....

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The Assessing Officer held that the respondentassessee had filed inaccurate particulars and imposed penalty of ₹ 13.13 Lakhs under Section 271(1)(c) of the Act. 6. In appeal, the CIT (A) rendered a finding of fact that the assessee has disclosed the receipt of the above amount of ₹ 1.11 Crores and a claim unsustainable in law will not amount to furnishing of inaccurate particulars. It further held that the Assessing Officer had not given any finding that the receipt of the aforesaid .....

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same to the partner's capital account and it was not being offered to tax as the same was a receipt on capital account outside the scope of Section 45 of the Act. The Tribunal also noted that there was letter which accompanied the return of income wherein all facts relating to aforesaid receipt was indicated including the fact that an amount of ₹ 54 Lakhs originally paid to the vendor under the development agreement in 1995 and on cancellation of agreement, the original vendor of the l .....

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inding of fact that all facts had been disclosed by the respondent-assessee alongwith its return of income including its claim of not being chargeable to tax. This claim was not found to be not bonafide. The Tribunal also held that the reliance placed on the decision of Delhi High Court in the case of CIT Vs. Zoom Communication P. Ltd. reported in 327 ITR 510 by the Revenue is inappropriate as in that case the assessee had deliberately debited the amount to Profit and Loss Account though not in .....

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t of its rights to immovable property. It is also contended by the revenue that the decision of Delhi High Court in Zoom Communication P. Ltd. is applicable to the present facts and the appeal should be admitted. 9. We find that the respondent-assessee had originally paid an amount of ₹ 54 Lakhs as a consideration for the development agreement in 1995. In the previous year relevant to assessment year, the respondent-assessee received from the vendor an amount of ₹ 1.65 Crores which i .....

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