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2016 (7) TMI 604 - ITAT MUMBAI

2016 (7) TMI 604 - ITAT MUMBAI - TMI - Penalty levied u/s 271(1)( c ) - exemption u/s 54F denied - whether for the purpose of calculating the date of purchase, the date of allotment is to be considered, or the date of registration? - Held that:- This aspect has been duly considered in various decisions, as relied on by the assessee. In these decisions, it is the date of allotment, which has been held to be the relevant date for the purpose of calculating the date of purchase. That being so, the .....

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ncealment penalty, in my considered opinion, is not leviable. - Decided in favour of assessee. - I.T.A. No.1020/Mum/2015 - Dated:- 7-7-2016 - SHRI A.D.JAIN, JUDICIAL MEMBER For The Appellant : S/Shri Sanjay Kapadia and Navinkumar Mishra For The Respondent : Shri Ajay ORDER PER A D JAIN (JM) This is assessee‟s appeal for assessment year 2007-08 challenging the order of ld.CIT(A) dated 26.12.2014 upholding the penalty levied by the AO of ₹ 9,25,650/- u/s 271(1)( c ) of the Income Tax a .....

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ng the course of Assessment proceedings, the AO observed that the holding period of the said property had been shown as more than 36 months. The possession of the said property was taken by the assessee on 30.4.2003 and it was sold on 11.5.2006. Therefore, the assessee calculated the period of holding from 30.4.2003. The assessee, according to the date of agreement for purchase, had purchased the property on 5.6.2003. Therefore, the AO treated the holding period from 5.6.2003. Hence, according t .....

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at it was unbelievable that the seller had handed over the possession of the property worth ₹ 70 lakhs on payment of a mere ₹ 9500/-. During the course of the appellate proceedings, the assessee filed a letter handed over by the seller, showing the date of possession as 30.4.2003. This was also rejected by the ld.CIT(A) on the ground that it was a self-serving document, with no evidentiary value. In the second appeal, the Tribunal also confirmed the orders of the authorities below. T .....

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and treated the gain as short term capital gain and levied penalty at the rate of 100% of the tax sought to be evaded, of ₹ 9,25,650/- u/s 271(1)( c ) of the Act. Aggrieved by the decision of the AO, the assessee preferred an appeal before the ld. CIT(A), confirmed the action of the AO by observing and holding as under : 3.2. DECISION: I have considered the submission of the Authorized Representative and the order of the assessing Officer. It is seen that the flat sold by the assessee vid .....

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ong term as claimed by the appellant. The action of the appellant of claiming the gains as long term on the basis of letter from the seller was found to be a self serving document with no evidentiary value, even by the ITAT. During appellate proceedings, the Authorized Representative could was actually received on 30-04-2003 as claimed. In any case, ownership of the flat and the period of holding is determined by the date of registration of deed of conveyance, as has been held in number of court .....

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titute of Social Science. She is M.A., P.hd by qualification. With such high educational qualification and responsible job, such' a legally invalid claim is not acceptable. While it is true that all additions do not automatically and mandatorily lead to levy of penalty u/s.271 (J)( c), but the facts of the present case in which the assessee has made an blatantly inadmissible and wrong claim, does justify the levy of penalty. The bonafides of the assessee have to be established and cannot be .....

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while making a claim of this nature, that would give a licence to unscrupulous assessee to make wholly untenable and unsustainable claims without there being any basis for making the same." In view of all the above, the action of the AO in holding that the assessee has furnished inaccurate particulars of income rendering herself liable for penalty, and in levy of minimum penalty @ 100% of tax sought to be evaded, is correct and is hereby upheld. Grounds of appeal are dismissed. Aggrieved b .....

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Parekh (44 tth 68); B) Jitender Mohan V/s ITO (11 SOT 594 (Del); C) CIT V/s Abrar Alvi (247 ITR 313 (Bom) D) Neelam Suryakant Pujari V ACIT (ITA No.2947/Mum/2005) dated 28.12.2006 5. The Ld. DR strongly relied on the impugned order and contended that the assessee has stated the date of possession to be 30.4.2003, which does not find any support from the letter/affidavit of the seller of the property, which has no evidentiary value. 6. I have heard the rival contentions and have perused the mate .....

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flat on 30.4.2003, which remains unsupported, but for the affidavit of the seller, would not be decisive so far as regards the levy of concealment penalty. It is an issue on which the assessee entertains a particular belief, which is not the belief of the taxing authorities and which view, being judicial supported, as above, cannot be said to be an implausible or impossible view. As such, it is a debatable issue, on which, concealment penalty, in my considered opinion, is not leviable. For this, .....

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ncome Tax in ITA No. 5489/Mum/2015 (AY-2012-13) vide order dated 30.6.2016 has considered an identical issue on similar facts, and has decided the issue in favour of assessee by observing and holding as under : 9. We have heard the rival submissions and perused the material on record including the orders of authorities below and case laws relied upon by the rival parties. We find from the page No.36 of the paper book which is a letter of allotment dated 27.11.2006 accompanying the schedule of pa .....

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from transfer of flat which was allotted on 27.11.2006 registered in the name of assessee on 30.11.2009 and sold on 28.6.2011 is a LTCG or STCG. If assets transferred is held for more than 36 months then the resultant gain would be LTCG and the assessee would be entitled to indexation of cost for the purpose of calculation of capital gain. In this case, the assessee has claimed to have been allotted the flat on 27.11.06 when the assessee was given letter of allotment and assessee made payment of .....

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during the course of hearing. In the case of Smt.Lata G Rohra (supra), the Tribunal has held as under : As per section 2(14), read with section 2(14)(vi), the rights in flat, acquired by the assessee on execution of purchase agreement on 7-8-1993, came within the purview of the term capital asset‟. From the perusal of language used in Explanation (iii ) to section 48, which provides for manner of computation of indexed cost of acquisition, it is apparently clear that it refers only to date .....

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had passed assessment order after taking into consideration the same. Hence, merely for the reason that no specific findings had been given in the assessment order, the same could not be said have been passed without application of mind. In this view of the matter, the order under section 263 passed by the Commissioner was to be set aside. [Para 9] In the result, the appeal filed by the assessee stood allowed. [Para 10] In the case of Ms.Madhu Kaul (supra) it has been held by the Hon‟ble P .....

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ment of balance instalments, identification of a particular flat and delivery of possession are consequential acts and relate back to and arise from the rights conferred by the allotment letter. [Para 7] Therefore, the Tribunal had erred in holding that the transaction does not envisage a long-term capital gain. [Para 8 In the case of Vinod Kumar Jain (supra) it has been held by the Hon‟ble Punjab and Hariyana High Court as under : The assessee was allotted a flat on 27-2-1982 on instalmen .....

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tion 54. The Assessing Officer disallowed the assessee‟s claim holding that the possession of the flat was given to the assessee on 15-5-1986 and, therefore, the capital gain on sale of the flat in question was short-term capital gain governed by section 2(42A). On appeal, the Commissioner (Appeals) upheld the view taken by the Assessing Officer. The Tribunal also dismissed the assessee‟s appeal. On appeal to the High Court : In the case of Ved Prakash and Sons (supra) it has been he .....

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account of part performance of an, agreement, etc. Conversely, all such other persons who may be termed as lessees, mortgagees with possession or persons in possession as part performance of the contract would not in strict parlance come within the purview of "owner". As per the Shorter Oxford Dictionary, edition 1985, "owner" means one who owns or holds something; one who has the right to claim title to a thing. 15. The apex court in the case Jagdish Chand Radhey Shyam v. St .....

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nt that in the event of default in making the payment the Government shall have the right to resume the property was an unreasonable restriction on the enjoyment of the property and declared the same ultra vires. In the instant case, the sale though made by a private entrepreneur appears to be in identical terms as normally stipulated in various auction sale/sales by Government agencies where there is stipulation in the agreement to the effect that in the event of default in payment monies alrea .....

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gment of the Income-tax Tribunal, Chandigarh Bench in the case of Surjeet Singh v. ITO [1979] Tax 53(6)-28, though not binding upon this court, has all the same a persuasive value. The point in dispute is squarely covered by this judgment. Thus, we are of the view that the Appellate Tribunal was right in law in holding that the capital gain was a long-term capital gain. Thus the question of law referred is answered in the affirmative. In the case of Sanjay Kumath (supra)(Indore), the Tribunal ha .....

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on 22-1-2005, when he was given letter of allotment which clearly described the precise number of flat so allotted to him. As per the provisions of section 2(47)(ii), "Transfer" in relation to capital assets includes the extinguishment of any right therein. This letter of allotment extinguishes the rights of builder in the said flat in favour of the assessee in respect of this flat and by signing the letter of allotment, the assessee agreed to buy the same and for which payment was al .....

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nt of ₹ 6.23 lakhs in the month of allotment itself i.e. January, 2005. Subsequent payment was also made as per the terms agreed with the builder. Only after receipt of entire amount, the builder has executed agreement with the assessee on 27-2-2009. The assessee has sold the said flat on 5-3-2009. Since the assessee has acquired all the rights in the flat on 22-1-2005, the period of holding is to be computed with respect to the date of allotment i.e. 22-1-2005. Taking the date of sale as .....

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the assessee had claimed the original cost of acquisition at the total payments made by him. Therefore, the real question was what was the cost of acquisition for the purpose of section 48, whether the amount of first instalment paid by the assessee or the total amount paid by the assessee for acquiring the house. [Para 7 A house property has got its own intrinsic/market value. The cost or the value of the property remains the same subject to minor variations of interest of discount factor, irre .....

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heme becomes ridiculous. It is to be seen that the factor of inflation is not with reference to the payments made by the assessee but with reference to the value of the asset vis-a-vis the cost of acquisition of the sale consideration of the property. [Para 8] Therefore, in the instant case the cost of acquisition of the house for the purpose of long-term capital gains computation was the total cost incurred by the assessee and not the first instalment value as determined by the lower authoritie .....

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