THE COMMISSIONER OF INCOME TAX - V vs. SHEKHAR DAS GUPTA

IN THE HIGH COURT OF DELHI AT NEW DELHI . ITA 531/2013 . THE COMMISSIONER OF INCOME TAX - V..... Appellant . Through Mr. Sanjeev Sabharwal, Advocate. . . . versus . . . SHEKHAR DAS GUPTA ..... Respondent . Through Ms. Sugandha Anand, Advocate. . . . CORAM: . HON'BLE MR. JUSTICE SANJIV KHANNA . HON'BLE MR. JUSTICE SANJEEV SACHDEVA . . . O R D E R . 26.11.2013 . . . This appeal by the Revenue under Section 260A of the Income Tax Act, 1961 (Act, for short) impugns deletion of part penalty by the Commissioner of Income Tax (Appeals) which order has been affirmed by the tribunal. At this stage, we notice that the Commissioner of Income Tax (Appeals) has held that the assessee was liable for concealment penalty under Section 271(1)(c) in respect of the short-term capital gain, which was declared as long-term capital gains. However, in respect of sale of shares allotted to the assessee under ?Employees Stock Option Plan? of Oracle Corporation, USA, penalty has been deleted. The assessee, it is accepted, had sold the said shares on 13th May, 2003 and the shares allotted to him on 12th December, 1997 and 10th July, 1998. . Details of the said transactions were made available and duly stated in the return by the respondent-assessee. On this aspect there is no dispute. The assessee had also paid advance tax @ 20% on the capital gains on sale of the said shares. However, in the income tax return, he had applied the tax rate of 10%. The Assessing Officer has held that the tax rate applicable in terms of the Explanation to Section 112(1) was 20% and not 10% as the shares were not listed in an Indian stock exchange but were listed abroad. The stand of the assessee was that he had acted on the legal advice of his Chartered Accountant on the said taxation issue. . Keeping in view the factual matrix and explanation furnished by the assessee, the first appellate authority and the tribunal have held that . the assessee has been able to discharge the onus under Explanation 1 to Section 271(1)(c) of the Act. The tribunal has noticed other errors made on computation of long-term capital gains on the sale of the said shares, to the detriment of the respondent-assessee. In fact, the long-term capital gain on sale of the said shares was Rs.1,39,09,213/- and not Rs.1,65,84,079/- as declared by the respondent-assessee in the income tax return. The first appellate authority and the tribunal have taken a holistic and broad view and have examined various aspects and issues and thereafter arrived at a conclusion that there were lapses on the part of the Chartered Accountant, who had prepared the return. The assessee had acted bonafidely as he had duly declared and stated the entire transaction. In fact, the figure of capital gain as declared was higher than the amount which was actually chargeable. . In these circumstances, we are not inclined to entertain the present appeal and the same is dismissed. . . . . . . . SANJIV KHANNA, J. . . . . . . . SANJEEV SACHDEVA, J. . NOVEMBER 26, 2013 . NA . . . $ 04 .