Case Law Details
Nitinkumar Desai Vs ACIT (ITAT Ahmedabad)
The case of the assessee is that he has made investment in Gota land to the extent of Rs. 1,09,82,400/-. This investment was made by the assessee within two years of sale of agriculture land. Thus, case of the assessee was that capital gain arose to him on sale of agriculture land was invested in purchase of agriculture land. According to the assessee he was entitled for deduction under section 54B. The AO has cut short his claim by a sum of Rs.85,67,400/- on the ground that this payment was made after due date of filing of return. Thus, the question which arose is whether the assessee has made any deliberate attempt for concealment of income. Whether the assessee could harbor a belief that since he has made an investment of Rs. 1,09,82,400/- in purchase of agriculture land which could have been purchased within two years from the sale of agriculture land and after such an investment no capital gain liability would be upon him. If we compare this belief haboured by the assessee with addition of Rs.84,76,976/- then it would reveal that this Rs.84,76,976/- addition has been resulted on account of not accepting claim of assessee of payment amounting to Rs.85,77,400/-, which is more than the addition made by the AO. In order to show his bona fide the assessee has produced details of payment made to the vendors. The assessee has produced their identity, copy of sale deed and copies of receipts executed by the vendors. To our mind, a layman could easily habour a belief that since he has already invested total capital gain in purchase of new agriculture land, therefore, there might not be any liability of tax qua alleged capital gain. It is a different matter that he has not challenged additionas well as the ld.AO has adopted a different methodology for denying benefit to the assessee. But his explanation was not proved to be false by the Revenue. He has substantiated his explanation with the help of details of payments, copies of sale deed as well as receipts of payments executed by vendors. As far as case law referred by the ld.DR is concerned, it is altogether on different facts. In that case, the assessee had short term capital gain on sale of land which was wrongly claimed as long term capital gain by substituting year of acquisition as 1999 instead of 2004 and said mistake was not brought to the notice of AO suo moto. In this background penalty was confirmed. Here question was whether at the time of filing of return, the assessee could harbor a belief that there is no long term capital gain tax liability upon the assessee. In the given facts and circumstances discussed above, we are of the view that the assessee could easily harbor a belief that there was no long term tax liability upon him. It is a different matter that a belief did not meet approval of the AO. In view of the above discussion, we are of the view that assessee does not deserves to be visited with penalty. We allow appeal of the assessee and delete penalty.
FULL TEXT OF THE ITAT JUDGMENT
Assessee is in appeal before the Tribunal against order of the ld.CIT(A)-20.7 .2017 passed for Asstt.Year 2013-14.
2. Solitary issue involved in this appeal is whether the assessee deserves to be visited with penalty under section 271(1)(c) of the Income Tax Act, 1961 or not.
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