MANI JAIN,JAIPUR vs. INCOME TAX OFFICER, WARD 6(1), JAIPUR

ITA 870/JPR/2026Status: DisposedITAT Jaipur16 September 2026AY 2016-177 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that an addition made solely on the basis of a deeming provision like section 56(2)(vii)(b), without any finding that the actual consideration exceeded the stated amount, does not automatically attract penalty under section 271(1)(c). The assessee had disclosed all material facts and the explanation was not found to be false.

What were the facts?

The assessee purchased an immovable property for a consideration below its stamp duty value. The Assessing Officer (AO) reopened the assessment and made an addition under section 56(2)(vii)(b) based on the difference between the consideration and the stamp duty value. Subsequently, the AO initiated penalty proceedings under section 271(1)(c).

What were the issues?

Whether penalty under section 271(1)(c) can be levied on an addition made under the deeming provision of section 56(2)(vii)(b) when the assessee has disclosed all material facts and no finding of concealment or furnishing inaccurate particulars has been made.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 56(2)(vii)(b),Section 148,Section 149

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘SMC’ BENCH, JAIPUR

Before: Shri Kuldip Singh & Shri Prakash

PER : PRAKASH, ACCOUNTANT MEMBER:-

1.

This appeal by the Assessee is directed against the order of the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [hereinafter referred to as “the learned CIT(A)”] dated 17.02.2026 arising out of the penalty order dated 19.03.2024 passed by the Assessing Officer (hereinafter referred to as “the AO”) under section 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for the assessment year 2016-17. Mani Jain

2.

The grounds of appeal raised by the Assessee before us in the memorandum of appeal in Form No. 36 read as under:

“1. On the facts and circumstances of the case and in law also initiation of penalty u/s 271(1)

The order continues below.

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