2024 (8) TMI 1534

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..... ed against the levy/confirmation of penalty u/s 271(1)(c) of the Act. 3. The brief facts of the case are that the assessee had claimed long-term capital gains on account of sale of shares at Rs.14, 94, 407/-. During the assessment proceedings, the assessee produced relevant documents to substantiate his claim, however, the Assessing Officer held that as per the report received from the Investigation Wing, there was large scale price rigging of certain scrips, whereby, the bogus long-term capital gains/losses have been claimed by various assessees. He relying upon the said investigation report, held that the long-term capital gains claimed by the assessee as bogus. The matter travelled up to the level of Hon'ble Jurisdictional High Court an .....

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..... ssee has earned only small amount of long-term capital gains of Rs.4, 61, 771/-. Had the assessee any prior information or intention to claim bogus long-term capital gains, the assessee would have claimed higher amount in this respect. He has further submitted that the revenue could not rebut any of the evidences furnished by the assessee to prove the transaction as bogus but the impugned addition was made solely on the basis of preponderance of probabilities. Under the circumstances, the ld. counsel has submitted that since it could not be proved that the assessee was actually involved in the bogus transaction, if any, therefore, merely because the additions have been made on the basis of preponderance of probabilities, the penal provision .....

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..... erm capital gains. Though the additions have been made/confirmed on the basis of preponderance of probabilities in this case, however, to establish the allegation of concealment of income/ furnishing of inaccurate particulars of income to invoke penal provisions of section 271(1)(c) of the Act, stricter proof is required, which, in our view, is missing in this case. Hence, giving the benefit of doubt, we are of the view that the assessee should not be burdened with penal consequences of provisions of section 271(1)(c) of the Act. In view of this, the impugned penalty levied/confirmed by the lower authorities is ordered to be deleted. 7. In the result, the appeal of the assessee stands allowed. Kolkata, the 29th August, 2024.
Case laws .....

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