No Penalty for Recharacterising Capital Gains as Business Income

Jamnaben Parshottamdas Patel Vs ITO (ITAT Ahmedabad) Penalty under Section 271(1)(c) Deleted Where Income Was Fully Disclosed but Recharacterised: The Ahmedabad Bench (SMC) of the Income Tax Appellate Tribunal (ITAT) allowed the assessee’s appeal for AY 2011-12 and deleted the penalty of ₹64,071 levied under section 271(1)(c), holding that mere recharacterisation of income does not amount to concealment or furnishing of inaccurate particulars. In this case, the assessee had disclosed profits from sale of shares as long-term capital gains in the return. During reassessment proceedings, the ...