ACIT vs. Sunland Metal Recycling (ITAT Mumbai)

DATE: December 10, 2014 (Date of pronouncement)
DATE: January 9, 2015 (Date of publication)
AY: 2008-09
FILE: Click here to download the file in pdf format
S. 50C/ 271(1)(c): Even if s. 50C is applicable, computing capital gain de hors it does not amount to furnishing inaccurate particulars of income or concealment of income for levy of penalty u/s 271(1)(c)

The assessee sold office premises to its sister concern for a sale consideration of Rs. 1.55 crores. The Assessing Officer considered the full sale consideration as per stamp duty authority valuation at Rs. 2,00,08,000 in accordance with section 50C of Income Tax Act. Accordingly, the Assessing Officer made an addition to the Short term Capital Gain. Subsequently, the Assessing Officer initiated penalty proceedings u/s 271(1)(c) for levy of penalty against the addition made to the Short term Capital Gain and levied penalty. The CIT(A) has deleted the penalty. On appeal by the department to the Tribunal HELD dismissing the appeal:

The Assessing Officer has not given any finding that the sale consideration disclosed by the assessee is not actual amount received as per the agreement of sale. The addition was made by invoking the deeming provisions of section 50C whereby the full value of consideration was adopted as per the valuation of the stamp duty authority for levy of stamp duty. The assessee has disclosed all relevant details as well as documents in support of its computation of Short term Capital Gain by taking into consideration the actual sale consideration received by the assessee. Consequently penalty u/s 271(1)(c) cannot be levied (Renu Hingorani Vs. ACIT (ITAT Mum), Chimanlal Manilal Patel vs. ACIT (ITAT Ahmedabad) & CIT Vs. Madan Theatres Ltd (Cal HC) followed)

Leave a Reply

Your email address will not be published. Required fields are marked *