GST Helpdesk   Subscription   Demo   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2016 (5) TMI 23 - ITAT DELHI

2016 (5) TMI 23 - ITAT DELHI - TMI - Levy of penalty u/s 271(1)(c) - Held that:- In the instant case it cannot be said that the assessee withheld any relevant information regarding the receipts and income from the AO. The figure added back by the AO pertaining to the loss on sale of shares was a figure disclosed by the assessee itself. With regard to the provisions of section 271(1)(c ) of the Act pertaining to penalty, the Hon’ble Apex court has authoritatively laid down that making of a claim .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

n filed by the assessee against the order dated 26.8.2011 of Ld. CIT(A)-IX, New Delhi for Assessment Year 2004-05 on the following ground of appeal:- 1. Whether on the facts and in the circumstances of the case, the ld. CIT(A) has erred in upholding levy of penalty u/s 271(1)( c) of the Act of ₹ 681625/-? 2. Briefly stated, the facts of the case are that the return was filed by the assessee on 30/10/2004 declaring income of ₹ 3,21,10,203/-. The case was processed u/s 143(1) on 12/12/ .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e Short term capital gains . The facts related to the issue are that the assessee had purchased 2,11,950 shares of M/s Allied Tronics (India) Ltd. @ ₹ 10 per share on 1/11/2003 and had shown the sale of these shares to one of its employees Shri Jatinder Bawa @ Rs.l/- per share on 20/3/2004 i.e. during the year. This transaction had resulted in a loss of ₹ 19,00,000 which had been set off by the assessee against the short term capital gain during the year. The AO was of the opinion th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

₹ 17,88,942/- was added back to the income of the assessee. 3. In appeal before the Ld. First Appellate Authority, the Ld. CIT(A) has also confirmed the addition made by the assessing officer with the following comments:- I have considered the matter. On going through the details of the share held by the assessee company, it is found that the assessee company owes shares six companies and more than 60 mutual funds. There is frequent churning buy and sell activities are frequent. It is sett .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

shares. In the assessee s case, there is frequent buying and selling of securities by way of shares and units of mutual funds. It would thus be evident that the assessee is in business of dealing in shares. I am, therefore, in agreement with the Assessing Officer that the provision of explanation to section 73 would apply in the assessee s case and the loss even if it had been genuine would be a speculation loss. In the result this ground is dismissed. 4. The appellant further agitated the matt .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

see is stated to have sold the shares on 20th March, 2004 at Re.1/ per share. The shares are movable property and movable property like shares can be transferred by signing share transfer deed along with relevant share certificate and on receipt of the sale consideration. However, in the present case the sale consideration is not received either at the time of sale or even subsequently. Therefore, there is no effective sale of shares. The shares are stated to be sold on 20th March, 2004, thereaf .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the least possible time, the shares could not have been registered in the name of Shri Jatinder Bawa on 20th March, 2004. Though Shri Jatinder Bawa is stated to be employee of appellant company, he was never produced nor his whereabouts declared by the assessee to the Assessing Officer so that correct fact could be ascertained. When the assessee did not file requisite information or substantiate his claim, the Assessing Officer is competent to draw adverse inference. It can be stated that the a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

sh genuineness of the transaction of sale of shares. Rather the assessee tried to claim the loss against other short term capital gain earned by it. We, therefore, hold that the loss of ₹ 19 lac stated to be suffered by the assessee is not a genuine loss and hence was rightly disallowed by the Assessing Officer. As regards disallowance of alternate ground that the same was treated as speculation loss, we find that this was a solitary transaction of sale of share during the year and hence i .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

had filed misleading facts and claimed loss on shares under the head Short-term capital loss and had set off this against the Short-term capital gains. According to the AO the assessee had consciously and willfully filed inaccurate particulars of loss on sale of investments which was not in consonance with the provisions of the Act. Accordingly, penalty amounting to ₹ 6,81,625/- was imposed under the provisions of section 271(1)(c ) of the Act. 6. On appeal before the First Appellate Auth .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

It was further submitted that all the facts were disclosed in the Return of Income and during routine assessment proceedings all details were submitted. The transaction of sale and purchase was duly reflected in all company records and there was no charge that the transaction did not take place. Even the records of the company whose shares were sold were produced and they showed all the transactions and these were duly recorded in their share transfer and members records. The Ld. AR submitted th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

re disclosed by the assessee itself. With regard to the provisions of section 271(1)(c ) of the Act pertaining to penalty, the Hon ble Apex court has authoritatively laid down that making of a claim by the assessee which is not sustainable will not tantamount to furnishing inaccurate particulars. Thus, in CIT vs. Reliance Petroproducts Pvt. Ltd. 322 ITR 158 (SC), the Hon ble Apex Court has held as follows: A glance at this provision would suggest that in order to be covered, there has to be conc .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version