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TMI Blog2024 (10) TMI 1204X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed under section 271(1)(c) of the Act, for the assessment year 2013-14. 2. The sole ground raised by the assessee in its appeal is as follows: - "1. On the circumstances and facts of the case and in law, as levied by CIT(A) erred in conforming the penalty of Rs. 3,03,789 u/s 271 (1) (c) of the Income Tax Act, 1961. As levied by the assessing officer on account of disallowed of long-term capital loss of Rs. 9,83,137 arise on account of slump sale as per slump sale agreement dated 02.04.2012." 3. The brief facts of the case are that the assessee is an individual and was a proprietor of M/s Satish Enterprises, which was engaged in the business of trading in cable, wire and electric items. For the year under consideration, the assessee fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s Satish Enterprise Private Limited had purchased the business from the assessee's proprietary concern for which consideration was paid as follows: - Mode of Consideration Amount (in Rs. ) Issue of 10 lakh equity share of Rs. 10 1,00,00,000 By cheque 4,47,00,000 4. The assessee further submitted that the transaction falls under section 50B and not under section 47(xiv) of the Act. It was submitted that it was a business purchase transaction as per the Business Purchase Agreement, which is a slump sale under section 50B of the Act. The assessee submitted Form 3CEA and the working of slump sale. The assessee further submitted that he had no capital gains in the year under consideration against which the loss can be adjusted and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20/03/2020, the AO levied a penalty of Rs. 3,03,789, on the basis that the assessee has furnished inaccurate particulars of income by claiming long term capital loss of Rs. 9,83,137. 6. The learned CIT(A), vide separate impugned order, upheld the penalty levied under section 271(1)(c) of the Act. Being aggrieved, the assessee is in appeal before us. 7. We have considered the submissions of both sides and perused the material available on record. Ostensibly, in the present case, the addition resulting in the impugned penalty arises out of the disallowance of the long-term capital loss incurred by the assessee from the slump sale transaction. During the assessment proceedings, it was noticed that the assessee's proprietary concern was take ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n record its income tax return for the subsequent years. From the perusal of the same, it is evident that the brought forward loss was not set off by the assessee. Thus, from the perusal of the evidence placed on record, it is evident that the very basis on which it was alleged that the entire transaction is an afterthought which is a trick to evade taxes and the long-term capital loss was added to the total income of the assessee is without any merits. Thus, we find that in the present case, the AO merely disagreed with the business transaction of the assessee whereby the proprietary concern was taken over by a company in which the assessee is a majority shareholder. Further, due to the long-term capital loss, which is the basis for the le ..... X X X X Extracts X X X X X X X X Extracts X X X X
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