TMI Blog2016 (6) TMI 1436X X X X Extracts X X X X X X X X Extracts X X X X ..... because additions have confirmed in appeal or no appeal has been filed by assessee against additions made, it cannot be the sole ground for coming to the conclusion that assessee has concealed any income. Before us, l.d AR has given the reasons and the facts which had resulted into addition. These submissions have not been controverted by the Revenue - there is nothing on record to demonstrate that assessee had filed inaccurate particulars of income or had concealed the particulars of income. We also get support from the judgement of CIT vs. Reliance Petroproducts Pvt. Ltd. [ 2010 (3) TMI 80 - SUPREME COURT] wherein as held that a mere making of the claim, which is not sustainable in law, by itself, will not amount to furnishing inaccur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said addition of ₹ 17,81,931/- made to the capital gains AO s vide order dated 22/09/2014 levied penalty of ₹ 5,50,616/- u/s.271(1)(c) on account of concealment of income. Aggrieved by the order of AO, assessee carried the matter before ld. CIT(A), who vide order dated 21/08/2015 (in Appeal No. CAS-I/271/2014-15) confirmed the penalty levied by the AO. Aggrieved by the orders of the ld. CIT(A), assessee is now before us and has raised following grounds:- 1. On the facts and circumstances of the case as well as law on the subject, the learned Commissioner of Income Tax (Appeals) has erred in confirming the action of assessing officer in levying penalty of ₹ 5,50,616/- u/s.271(1)(c) of the I.T.Act. 2. It is therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the amount attributable to the cost of construction and no value for land was recovered. AO was of the view that assessee should have also recovered the cost of land. He accordingly adopted the fair market value of land @₹ 8,000/- per sq.mt. and proceeded to make addition of ₹ 15,72,682/- u/s.45(2) of the Act. Ld.AR submitted that assessee has neither concealed any income nor furnished inaccurate particulars of income in the return of income. Assessee was under bonaf ide belief that since the land that was converted into stock-in-trade was sold in FY 2010-11 for the purpose of indexation, the inflation index of FY 2010-11 was to be considered for working out capital gains. With respect to the non-recovery of cost of land on sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vided in Explanation 1 to Section 271(1)(c) the amount added or disallowed in computing the total income shall be considered as the income in respect of which particulars have been concealed, for the purposes of clause (c) of Section 271(1), and the penalty follows. On the other hand, if the assessee is able to offer an explanation, which is not found by the authorities to be false, and assessee has been able to prove that such explanation is bona fide and that all the facts relating to the same have been disclosed by him, then in that case penalty shall not be imposed. 4.2. A case for levy of penalty for concealment of income has to be evaluated in terms of provisions of Explanation 1 to Section 271(1)(c), as per which if in relation to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase of CIT vs. Reliance Petroproducts Pvt. Ltd. reported at (2010) 322 ITR 158 (SC), wherein the Hon ble Apex Court has held that a mere making of the claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. Such claim made in the return cannot amount to the inaccurate particulars. 4.4. Considering the aforesaid facts and relying on the foresaid judgement of the Hon ble Apex Court in the case of CIT vs. Reliance Petroproducts Pvt. Ltd.(supra), we are of the view that in the present case no case for levy of penalty u/s. 271(1)(c) of the Act has been made out. We thus direct the deletion of penalty u/s. 271(1)(c) of the Act. Thus, the ground of assessee is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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