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TMI Blog2016 (10) TMI 555X X X X Extracts X X X X X X X X Extracts X X X X ..... e learned CIT (A)-VI erred in passing penalty order on the basis of concealmentwhere as the assessee has disclosed all facts in return of income filed. 3. The learned CIT (A)-VI erred in not considering that claim not tenable under the Income Tax Act 1961 will not amount to concealment of income. 4. The learned CIT (A)-VI erred in concluding that the claim for deduction u/s 54B was made by filing inaccurate particulars ignoring the meaning of the word "assessee" prior to amendment made by the Finance Act 2012 w.e.f 01-04-2013. 5. The learned CIT (A)-VI erred in not considering that the issue was debatable, hence no penalty cannot be levied. 6. The learned CIT (A)-VI erred in stating that investment was made prior to sale of the land ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accepted. AO however, was not convinced with the assessee's contention. Further, on perusal of the claim of deduction u/s 54B of the Act, the AO observed that the assessee had given advance for purchase of agricultural land in the A.Y 2007-08 and the balance of capital gain amount has been deposited with one Mr.Sudhir Reddy who owns agricultural land which he proposed to transfer to the society. From the recitals in the sale deed, AO observed that the lands were purchased prior to the sale of the original asset and that the assessee, being a society, is not eligible for deduction u/s 54B of the Act. Therefore, assessee's explanation was called for. In response, the assessee submitted that as per section 54B, the deduction is available to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plicable. The AO also rejected the assessee's contention that the assessee has disclosed all the details of the sale and purchase of land in his return of income and therefore, it is not a case of concealment of income or furnishing of inaccurate particulars. Holding that every assessee should keep in view the applicability of law at the time of filing of the return of income and that the assessee being aware and being appraised of the fact that the claim of section 54B was not applicable to the assessee's society even before filing of the return of income, the AO held that the assessee has suppressed the income to the tune of Rs. 5,10,18,594 u/s 54B of the Act. He accordingly, levied the minimum penalty u/s 271(1)(c) of the Act. Aggrieved, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of set off of the current year's loss u/s 71 wherein the LTCG of Rs. 44,19,890 is reflected which according to him is after set off of the exemption u/s 54B of the Act. Therefore, according to him, the assessee has disclosed all the relevant facts before the authorities below. In support of his contention that penalty is not leviable in the facts and circumstances of the case, he placed reliance upon the following decisions: i) Hon'ble Supreme Court in the case of CIT vs. Reliance Petro Products Ltd, 322 ITR 158 ii) Hon'ble Supreme Court in the case of Bhavana Thanawala vs. ITO in ITA No.1171/Mum/2009 iii) Hon'ble High Court of Delhi in the case of CIT vs. Jakson Ltd in ITA No.48/2013 & 49/2013 iv) Hon'ble Punbaj & Har ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing regard to the rival contentions and the material on record, we find that the assessee has furnished all the information relating to the sale of the land and also purchase of agricultural land in its return of income filed by way of Form ITR- 7. Assessee is also eligible for deduction u/s 11 of the Act as it is carrying on activities of imparting education. The only income of the assessee which is chargeable to tax is the Long Term Capital Gain. The assessee has declared the LTCG, but has claimed deduction u/s 54B of the Act. The assessee has not challenged the findings of the authorities below that the assessee is not eligible for deduction u/s 54B of the Act and has accepted the taxability of the same. The AO has initiated the penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X
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