TMI Blog2017 (6) TMI 780X X X X Extracts X X X X X X X X Extracts X X X X ..... d the same as exempt under a bonafide belief, we hold that the assessee’s case is squarely covered by case of Reliance Petroproducts (P.)ltd. [2010 (3) TMI 80 - SUPREME COURT] which states that merely making an incorrect claim in law would not tantamount to furnishing of inaccurate particulars of income when admittedly information given in the return is not found to be incorrect or inaccurate. Further it cannot be said that the claim of the assessee was false and therefore the decision in the case of Zoom Communication (2010 (5) TMI 34 - DELHI HIGH COURT ) would not apply in the present case. - Decided in favour of assessee. - ITA No.1001/Chd/2016 - - - Dated:- 23-5-2017 - SHRI SANJAY GARG, JUDICIAL MEMBER, AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER For The Appellant : Sh. Tej Mohan Singh For The Respondent : Sh. Manjit Singh ORDER PER ANNAPURNA GUPTA A.M. This appeal has been filed by the assessee against the order of the Ld. CIT(A)-1, Chandigarh dt. 19/08/2016, confirming the levy of penalty under section 271(1)(c) of the Income Tax Act,1961. 2. The assessee has raised the following grounds: That the Learned Commissioner of Income Tax (Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n one hand, even while treating the interest exempt and claiming refund on the other hand. The Assessing Officer further drew strength from the provisions of section 145A(b) pointing out that it is explicitly mentioned that interest received by the assessee on enhanced compensation was to be charged as income in the year of receipt. The Assessing Officer stated that the assessee would have enjoyed the income as exempt if the Department had not scrutinized the claim of the assessee. He therefore imposed penalty u/s 271(1)(c) of the Act, amounting to ₹ 15,45,849/-, @ 100% of the tax sought to be evaded on 50% of the interest on enhanced compensated received,. 4. During appellate proceedings the assessee pleaded that the interest on compensation having been received u/s 28 of the Land Acquisition Act, had been claimed as exempt under section 10(37) of the Act, under a bonafide belief, in view of the decision of the Jurisdictional High Court in the case of CIT Vs. Karanvir Singh(303 ITR 231) as per which the aforesaid interest was in the nature of compensation. The assessee therefore contended that the same would not tantamount to furnishing inaccurate particulars of income. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taxable under section 56(viii) during the assessment proceedings and offered the same to tax, which is evident from the assessment order itself. 7. Ld. Counsel for the assessee raised another argument in support of its contention that penalty was not leviable in the present case stating that in identical circumstances penalty initiated in the case of the Mother of the assessee i.e; Smt. Anjana Sehgal, for the same Assessment year i.e; 2012-13 was dropped by the Assessing Officer on the basis of identical submissions made before him. Ld. Counsel for the assessee drew our attention to the relevant documents in this regard placed in the Paper Book. 8. The Ld. DR on the other hand countered by saying that merely because the AO did not levy penalty in the assessees mothers case, was no reason for deleting penalty in the assessee s case also and the issue was to be decided on the basis of law. Ld. DR further pointed out that in any case the facts in the case of assessee s Mother Smt. Anjana Sehgal were distinguishable from the assessees case. Ld DR pointed out that in the case of Smt. Anjana Sehgal,the mother of the assessee, the return had been revised by her including the intere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e impugned income had been disclosed in the return of income. What has to be seen is whether not including the same in the income by claiming the same as exempt u/s 10(37) of the Act, could be said to have been under a bonafide belief. 11. We are in complete agreement with the contention of the Ld. DR that the applicable provision for bringing to tax interest on enhanced compensation for the impugned Assessment year i.e; 2012-13 was section 145A(b), 56(viii) 57(iv) of the Income Tax Act. The relevant provision are being reproduced here under: Section 145 A. Notwithstanding anything to the contrary contained in section 145,- (a)... (i).. (ii).. (b) interest received by an assessee on compensation or on enhanced compensation, as the case may be, shall be deemed to be the income of the year in which it is received. Income from other sources 56 (1) Income of every kind which is not to be excluded from the total income under this Act shall be chargeable to income-tax under the head Income from other sources , if it is not chargeable to income-tax under any of the heads specified in section 14, items A to E. (2) In particular, and withou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uisition Act alongwith interest under section 34 of the Land Acquisition Act. The assessee therefore, we hold, had under a bonafide belief treated the interest on enhanced compensation as being in the nature of compensation, and thus exempt u/s 10(37) of the Act. The explanation of the assessee,we find, cannot therefore be said to be false. For the same reason we are also not in agreement with the findings of the Ld. CIT(A) that the issue of taxability of interest received on enhanced compensation had attained finality. The Ld. CIT(A) has relied upon the judgment of the Apex Court in Ghanshyam (HUF)(supra) for arriving at this conclusion. But as stated above the said judgment leaves certain open ends on the issue by terming only a part of the it as being in the nature of interest while holding the rest as being in the nature of compensation. The Ld. CIT(A) has also referred to the decision in the case of Bir Singh (HUF) which was rendered by the Hon ble Punjab Haryana High Court. The decision of the Apex Court in the case of Ghanshyam(HUF) being that of the apex court, the same would prevail over the decision of the High Court and the assessee has, we hold, correctly relied up ..... X X X X Extracts X X X X X X X X Extracts X X X X
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