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Facts
The assessee filed an appeal against the CIT(A)'s order confirming the penalty levied by the AO under section 271(1)(c) for the assessment year 2011-12. The penalty was based on the concealment of income, specifically long-term capital gains, which the assessee claimed was not deliberately omitted but due to a lack of supporting documents at the assessment stage.
Held
The Tribunal held that the penalty was not justified. It noted that the assessee had filed a return under section 148, which replaces the original return, and thus the basis for levying penalty under section 271(1)(c) did not arise. Additionally, the Tribunal considered the additional evidence submitted, which supported the genuineness of the expenditure, and relied on Supreme Court judgments stating that mere disallowance of expenses cannot attract penalty.
Key Issues
Whether the penalty under section 271(1)(c) is leviable when the income was declared in a return filed under section 148, and whether the additional evidence submitted justifies the deletion of the penalty.
Sections Cited
271(1)(c), 274, 148, 139, 147, 143(3), 153A, 250, 251
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Income Tax Appellate Tribunal, JAIPUR BENCHES,’’SMC” JAIPUR
fu/kZkj.ko"kZ@AssessmentYear : 2011-12 cuke Shri Ramchand Laxmandas Babani The ITO P.No.2, Shiv Shankar Colony Vs. Ward -6(4) Janta Colony, Jaipur – 302 004 (Raj) Jaipur LFkk;hys[kk la-@thvkbZvkjla-@PAN/GIR No.: ANYPB 6571 A vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksjls@Assesseeby : Shri Mohit Balani, Advocate (Thru” V.C.) jktLo dh vksjls@Revenue by: Shri Gautam Singh Choudhary, JCIT-DR lquokbZ dh rkjh[k@Date of Hearing : 25/06/2025 mn?kks"k.kk dh rkjh[k@Date of Pronouncement : 21/08/2025 vkns'k@ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM This appeal filed by the assessee is directed against the order of the National Faceless Appeal Centre, Delhi [ for short CIT(A) ]dated 10-07- 2024, for the assessment year 2011-12 raising therein following grounds of appeal. ‘’1. The ld. CIT(A) has erred in law and on the facts of the case in confirming the action of the AO in levying penalty amounting to Rs.2,60,090/- u/s 271(1)(c) of the Act. Under the facts, the appellant cannot be charged with any of the mischief contemplated u/s 271(1)(c) of the Act.
2 ITANO. 192/JPR/2025 SHRI RAMCHAND LAXMANDAS BABANI VS ITO, WARD 6(4), JAIPUR 2. The ld CIT(A) has erred in law and on facts of the case in not appreciating that AO has levied penalty in not precisely holding that the appellant has furnished inaccurate particulars of income or concealed its particulars of income.
3. In any case, the quantification of the penalty is erroneous and excessive.
4. In any case, the penalty order is barred by limitation and therefore not sustainable.
The ld.CIT(A) has erred in law and on facts of the case in not appreciating that the AO has initiated penalty u/s 271(1)(c)of the Act without recording mandatory satisfaction as contemplated under the Act at the time of framing the assessment order.
2.1 It is pertinent to note that the ld. AR of the assessee has filed an application for admission of additional grounds whose details are as under:-
Asst. Year 2011-12 in the matter of SHRI RAMCHAND LAXMANDAS BABANI- Fixed on 25.06.2025 before Bench 'SMC' Sub: An application for admitting additional evidence as per Rule 29 of ITAT Rules, 1963 1. The present application is being preferred praying for admission of additional evidences in the above mentioned case of Applicant. The nature of additional evidences is described in the following table.
Sr. No. Nature of document Annexure 1. The declaration letter of Laxmi Construction on A dated 5-02-2002
2. All the above documents are necessary and vital for the adjudication of issue of penalty u/s 271(1)(c) of the Income tax act on the pretext of Selling of immovable property with disallowance of cost of improvement adjudicated by Ld Assessing officer and sustained by CIT(A). The aforesaid documents support the 3 ITANO. 192/JPR/2025 SHRI RAMCHAND LAXMANDAS BABANI VS ITO, WARD 6(4), JAIPUR stand of the Appellant that, the penalty of 22,60,090 levied under section 271(1)(c) is unjustified, as the disallowance of 1,53,549 towards cost of improvement was made solely due to the non-submission of supporting documents at the assessment stage. The Appellantnow seeks to submit additional evidence, including a Declaration Letter with "Laxmi Construction" for improvement work amounting to 193,000, along with the working of indexed cost. These documents directly support the genuineness of the claim made and demonstrate that the expenditure was actually incurred in connection with the long-term capital asset sold. The failure to produce such evidence earlier was not deliberate or intended to conceal income.
In this view of the matter, it is most humbly submitted that above mentioned additional evidences are extremely important pieces of evidence, to prove the bona fides of the Applicant. The additional evidences sought to be adducedhave direct and important bearing on the issue impugned under the appeal. Thus, it is requested that, the aforesaid evidences may kindly be admitted for the substantial cause of justice and alsoin light of the recent judgment of Hon'ble Supreme Court in case of Sanjaykumar Singh vs. State of Jharkhand (Civil Appeal No.1760 of 2022 dated 10.03.2022) (copy attached herewith). All these evidences are going to the root of the controversy, and hence, are integral for the proper and fair dispensation of justice.
The Appellant prays of the Hon'ble Tribunal members to admit the additional evidences in the interest of justice and considered while deciding the appeal.’’
4 ITANO. 192/JPR/2025 SHRI RAMCHAND LAXMANDAS BABANI VS ITO, WARD 6(4), JAIPUR
5 ITANO. 192/JPR/2025 SHRI RAMCHAND LAXMANDAS BABANI VS ITO, WARD 6(4), JAIPUR 3.1 At the outset of the hearing of the appeal, the Bench noted that there is delay of 134 days in late filing the appeal by the assessee for which the assessee has filed an application for condonation of delay narrating therein the reason for such inordinate delay. 1. That the Appellant has filed an Appeal against the order u/s 250 dated 10.07.2024 by way of which the respondent has rejected each ground of appeal
2. The Appellant most respectfully submits that the impugned order which was passed u/s 250 of the Act was communicated to the Appellant on 10.07.2024. That the said order was communicated to the Appellant on 10.07.2024 and thus the time limit to file this present Appeal expired on 08.09.2024. However, the present Appeal has been filed on 11.02.25 and thus there is a delay of 155 days in preferring the Appeal
3. The reason for such delay is explained as under i The Appellant most respectfully submits that the impugned order which was passed u/s 250 of the Act was communicated to the Appellant on 10.07.2024. ii. Following the impugned order, the applicant, acting on the basis of wrong advice of consultant did not prefer an appeal and made full payment of the penalty under section 250 of the Income Tax Act. However, upon second opinion, the applicant was advised that the order was appealable and thus the Applicant ought to have preferred the Appellant.
4. The delay in filing the appeal occurred solely due to erroneous advice given by the applicant's consultant. Thus, delay is not attributable to any fault or negligence on the part of the applicant. As held by the Hon'ble Supreme Court in Concord of India Insurance CO.Ltd. Vs Nirmala Devi & Ors. AIR 1979 SC 166; 118 ITR 507(Supreme Court), and Collector, Land Acquisition, Anantnag and Another Vs. MstKatiji and Ors. 1987(2) SCC 107, delay caused by erroneous advice of the Applicant's Consultant should be condoned to advance substantial justice. In light of this judgment, the applicant submits that the Applicant had sufficient gause for delay and the delay be condoned and the appeal be admitted as per law. The copy of judgments is annexed along with this Application and marked hereto as Annexure-"A" and Annexure - "B".
6 ITANO. 192/JPR/2025 SHRI RAMCHAND LAXMANDAS BABANI VS ITO, WARD 6(4), JAIPUR 5. The petitioner prays that this period of Bonafide ignorance may kindly be condoned. The present delay is neither intentional nor warranted. The application made herein is bona fide and deserves to be allowed application in the interest of justice.
2 PRAYER (a) It is therefore, most respectfully prayed that this Hon'ble Cou may be pleased to condone the delay of 155 days in filing the Appeal against the order dated 10.07.2024 passed by the learned CIT(E). (b) And pass any other and further order(s) as this Hon'ble Court deems fit, just and equitable in these facts and circumstances of the case. To this effect, the assessee has filed an affidavit deposing therein the above facts of the case. 3.2 On the other hand, the ld. DR objected to such an ordinate delay and submitted that the Court may decide the issue as deemed fit and proper in the case. 3.3 We have heard both the parties and perused the materials available on record and from the submissions of the assessee, the Bench feels that the assessee was prevented as he was not properly advised to file the appeal and thus it has resulted delay. The feels that reasons advanced by the assessee are sufficient reason for not filling the appeal in time and therefore, we condone the delay considering the judicial precedent cited (supra). Hence, the delay so made by the assessee in filing the appeal before ld.CIT(A) is condoned.
7 ITANO. 192/JPR/2025 SHRI RAMCHAND LAXMANDAS BABANI VS ITO, WARD 6(4), JAIPUR 4.1 Apropos grounds of appeal
, it is noticed that the ld. CIT(A) has confirmed the action of the AO by dismissing the appeal of the assessee. The narration so made by the ld.CIT(A) in his order is reproduced as under:- ‘’ Page 30: On going through the facts of the case and the documents at hand it emerges that the appellant has not furnished any proof of evidence of sale or any sale receipts/ voucher etc. Hence, these grounds of appeal adduced by the appellant are not upheld. In view of the above, these grounds of appeal are accordingly dismissed and the addition made by the AO on this account is hereby, confirmed.
6. In the result, the appeal is dismissed. In the result, the appeal is decided as above.
7. This order has been passed under section 250 read with Section 251 of the Income Tax Act, 1961.
4.2 During the course of hearing, the ld. AR of the assessee prayed for deletion of penalty amounting to Rs.2,60,090/-imposed by the AO u/s 271(1)©of the Act and the same has been confirmed by the ld.CIT(A) for which the ld.AR of the assessee has filed following written submission. ‘’1. The appellant above named craves liberty to place the following submissions in connection with the appeal filed by it against the penalty order passed by the learned Income Tax Officer, Ward 6(5), Jaipur (hereinafter referred to as the learned AO) dated 25.06.2019 and confirmed by the learned CIT(A) vide order dated 10.07.2024.
The Appellant, for the year under consideration, filed his Return of Income on 30.08.2018 declaring total income at Rs. 10,88,400/-after the Appellant received a notice u/s 148 of the Act out of which 10,73,028 is Long term capital gain and 15,368 is Income from other sources and The Assessment was finalized u/s 147/143(3) of the Act, determining the total income at Rs. 12,77,950/- i.e. in 8 ITANO. 192/JPR/2025 SHRI RAMCHAND LAXMANDAS BABANI VS ITO, WARD 6(4), JAIPUR consonance with the return u/s 148 of the Act. The learned AO initiated the penalty u/s 271(1)(c) r.w.s 274 of the Act on the basis that the Appellant had concealed the income while filing the return of income and ultimately levied penalty amounting to Rs.2,60,090/- The Appellant carried the matter before the learned CIT(A) who in turn confirmed the penalty levied by the AO. Hence, this appeal.
3. For sake of convenience, the issues which require Your Honour's consideration are set out hereinafter:- 3.1. Ld. AO has erred in law and on the facts of the case in levying the penalty of Rs.2,60,090/- u/s 271(1)(c) of the Act. 3.2. The levy of penalty being without jurisdiction and totally uncalled for, deserves to be quashed.
4. Grounds #1 challenges the action of Id. AO in levying penalty of Rs. 2,60,090/- u/s 271(1)(c) of the Act. 4.1. The Appellant, for the year under consideration, filed his return of Income on 30.08.2018 declaring total income at Rs.10,88,400/-after the Appellant received a notice u/s 148 of the Act and the assessment was finalized u/s 147/143(3) of the Act, determining the total income at Rs. 12,77,950/- i.e. in consananze with the return u/s 148 of the Act. The learned AO initiated the penalty u/s 271(1)(c) r.w.s 274 of the Act on the basis that the Appellant had concealed the income while filing the return of income and ultimately levied penalty amounting to Rs.2,60,090/- The Appellant carried the matter before the learned CIT(A) who in turn confirmed the penalty levied by the AO. 4.2. In this connection, the appellant most respectfully submits that there is no variation made to the returned income as it is apparent from the Assessment Order. The Appellant most respectfully submits that the penalty u/s 271(1)(c) of the Act in the present case has been levied on the basis that the Appellant has not shown the long term capital gain while filing the "Original return of income". 4.3. The Appellant at this juncture, the Appellant would like to draw your attention towards the provisions of S.148 of the Act, which are as under for your ready reference: [(1)] Before making the assessment, reassessment or recomputation under section 147, the Assessing Officer shall serves on the assessee a notice requiring him to furnish within such period, as may be specified in the notice, a return of his income or the income of any other person in respect of which he is assessable under this Act during the previous year corresponding to the relevant assessment year, in the prescribed form and verified in the prescribed manner
9 ITANO. 192/JPR/2025 SHRI RAMCHAND LAXMANDAS BABANI VS ITO, WARD 6(4), JAIPUR and setting forth such other particulars as may be prescribed, and the provisions ofthis Act shall, so far as may bess, apply accordingly as if such return were a return required to be furnished under section 139:] 4.4. Upon reading the above provisions of the Act, it becomes amply clear that the before making the Assessment u/s 147 of the Act, the Assessing Officer has to necessarily issued a notice requiring the Assessee to file the return of income and any such return filed u/s 147 of the Act, replaces the original return of income and for the purpose of the Act, such return is treated u/s 139 of the Act. 4.5. In the present case, as the alleged concealed income was shown in the return of income u/s 148 of the Act which is nothing else but a return u/s 139 of the Act, the question of applicability of penal provisions u/s 271(1)(c) does not arise and thus the penalty levied by the learned AO as well as conformed by the learned CIT(A) deserves to be deleted. Reliance for this proposition is placed upon the judgment of Hon'ble Jurisdictional High Court in the case of [2017] 80 Taxmann.com 162 (Gujarat) HiHIGH COURT OF GUJARAT Kirit Dahyabhai Patel V. Assistant Commissioner of Income-taxKS. JHAVERI AND KJ. THAKER, JJ TAX APPEAL NOS 1181, 1182 AND 1185 OF 20101DECEMBER 13, 20141 Section 271(1)(c) of the Income-tax Act, 1961-Penalty For concealment of income (Computation of Penalty) Assessment year 2002-03 Return of income filed in response to notice under section 153A is to be considered as return filed under section 139 for purpose of penalty under section 271(1)(c) and penalty is to be levied on income assessed over and above income returned under section 153A, if any [In favour of assessee) In view of specific provision of section 153A, the return of income filed in respome to notice under section 153A is to be considered as return filed under section 139, as the Assessing Officer has made assessment on the said return and, therefore, the return is to be considered for the purpose of penalty under section 271(1)(c) and the penalty is to be levied on the income assessed over and above the income returned under section 153A, if any Section 271(1)(c) does not specify any time-limit during which the amount of tax with interest has to be paid. When the assessees had paid the entire amount with interest, the Assessing Officer ought to have granted him immunity available under section 271(1) Therefore, penalty under section 271(1)(c) cannot be levied on the income shown in the return filed under section 153A CASES REFERRED TO CITv Chhabra Emporium [2003] 264 ITR 249/130 Tasman 818 (Delhi) (para 6.3), CIT v. SDV Chandr [2004] 266 ITR 175/136 Taxman 537 (Mad.) (para 6.3), GebilalKanhaialal (HUF) v. AM. CIT270 ITR 523/120051 143 Tasman 42 (Rai)
10 ITANO. 192/JPR/2025 SHRI RAMCHAND LAXMANDAS BABANI VS ITO, WARD 6(4), JAIPUR (para 6.3), Axsit. CIT. GehilalKanhaialal HUF 20121 348 ITR 561/210 Taxman 244/25 taxmann.com 214 (SC) (para 6.3), CIT v. Kanhaiyalal 2008] 299 ITR 19 (Raj.) (para 6.3), CIT v. Radha Kishan Goel [20051 278 ITR 454 (All) (para 6.3), CIT v. Abdul Rashi 201.31 40 taxmann.com 244 (Chattisgarh) (para 6.3), SMJ. Housing v. CI7[2013] 357 ITR 698/38 tasmann.com 203 (Mad) (para 6.3), CIT Vegetable Products Lad [1973] 88 ITR 192 (SC) (para 6.3) and Shourya Towers (P) Ladv. Dy CIT[20131 359 ITR 523/213 Taxman 20 (Mag 30 taxmann.com.10 (Delhi) (para 7). Saurabh M. Soparkar, Sr. Counsel and Mrs. Swati Soparkar, Adv for the Appellant P.G. Desai and Sudhir M. Mehta, Advs., for the Respondent The Copy of judgment is placed along with these submissions and marked hereto as Annexure-"A". Further Reliance is placed upon Shri Mahesh T Pandya Vs. ITO In -Annexure "B" Shri Ajoy Sharma Vs. DCIT in to 547/JP/2024-Annexure "C" 4.6. The penalty of ₹2,60,090 levied u/s 271(1)(c) is unjustified as the disallowance of 1,53,549 towards cost of improvement and Rs. 35,000 towards transfer expenses was made only due to non submission of bills during assessment. In this connection, the Appellant most respectfully submits, the Appellant at this juncture would like to draw your attention towards the application of additional evidence, wherein Your Honours can find that the Appellant has submitted the contract between the vendor "Laxmi Construction for the improvement of apartment amounting to Rs.93,000/- The Appellant most respectfully submits that as the asset sold in the present case is a long term capital asset the Appellant has claimed indexed cost of improvement, the working of which is as under for your ready reference 4.7. The said expenditure was genuinely incurred, and the relevant supporting documents are now being produced before the Hon'ble Tribunal. The omission was not deliberate or with intent to conceal income. The Appellant thus submits that the penalty levied on such disallowance is also bad, illegal and untenbable in law. Alternatively and without prejudice to the above, it is a well settled law that the mere disallowance of expense cannot attract levy of penalty. Further reliance is placed upon CIT us. Reliance Petroproducts Pvt. Ltd. [2010] 322 ITR 158 (SC). The copy of judgment is placed along with these submissions and marked hereto a s Annexure-"D".
11 ITANO. 192/JPR/2025 SHRI RAMCHAND LAXMANDAS BABANI VS ITO, WARD 6(4), JAIPUR 4.8. The Appellant thus requests Your Honors to kindly direct the Assessing officer to delete the penalty levied upon by the Assessing Officer. The appellant shall be grateful if the above submissions are considered while disposing of the appeals for the year under consideration.’’ To support the submissions, the ld. AR of the assessee has filed following index of papers. Sr. No. Particulars Pages 1. Copy of notice u/s 148 as on dated 28-03-2018 1 2. Copy of return filed by assessee on dated 30-08-2018 2 3. Copy of assessment order on dated 15-12-2018 3-6 4. Copy of notice u/s 271(1)© on dated 5-04-2019 7 5. Copy of reply of notice u/s 271(1)© filed by the appellant on 11- 8-11 04-2019 with Attachment – Demand Challan 6. Copy of order u/s 271(1)( c) on dated 25-06-2019 with copy of 12-20 computation of sheet of penalty on dated 25-06-2019 7. Copy of written submission filed by the assessee before the ld. 21-33 CIT(A) on dated 16-04-2024 with 1. Passport 2. Acknolwegement 176793211160424(1) This is to certify that page no. 1-20 were placed before the Assessing Officer whereas pages no. 21-33 is the copy of written submission filed before the ld. CIT(A)
4.3 On the other hand, the ld.DR supported the order of the ld. CIT(A). 4.4 We have heard both the parties and perused the materials available on record. The Bench also admits the additional grounds of appeal with a view to providing equity and justice to the assessee since it pertains to the case of the assessee. In this case, it is noted that the assessee for the year under consideration had filed his return of income u/s 148 of the Act on 30-
12 ITANO. 192/JPR/2025 SHRI RAMCHAND LAXMANDAS BABANI VS ITO, WARD 6(4), JAIPUR 08-2018 declaring total income at Rs. 10,88,400/- which includes long term capital gain of Rs.10,72,028/- and income from other sources Rs.15,368/-. Accordingly, the assessment u/s 147/143(3) of the I.T. Act had been completed on 15-12-2018 at the total income of Rs.12,77,950/-. Hence, the AO initiated penalty u/s 271(1)( c) of the Act on the basis that the assessee had concealed the income while filing the return of income and ultimately levied penalty amounting to Rs.2.60 lacs. In first appeal, the ld.CIT(A) has confirmed the action of the AO. In appeal before us, the assessee submitted that the penalty u/s 271(1)(c) of the Act in the present case had been levied on the basis that the assessee had not shown the long term capital gain while filing the original return of income. During the course of hearing, the ld. AR of the assessee had drawn attention of the Bench towards section 148 (supra) which amply clears that before making assessment u/s 147 of the Act, the AO has to necessarily issued a notice requiring the assessee to file the return of income and for the purpose of the Act, such return is treated u/s 139 of the Act. In the present case, as the alleged concealed income was shown in the return of income u/s 148 of the Act. Out of that return so filed the ld. AO levied the penalty on the whole income and the addition for disallowance of claim. Thesimilar issue has 13 ITANO. 192/JPR/2025 SHRI RAMCHAND LAXMANDAS BABANI VS ITO, WARD 6(4), JAIPUR been dealt with by the High Court of Madhya Pradesh in the case of CIT Vs. Suresh Chandra Mittal wherein the High Court held as under : 5. We find ourselves in agreement with the view taken by the Tribunal. It is well-settled that under section 271(1)(c), the initial burden lies on the revenue to establish that the assessee had concealed the income or had furnished inaccurate particulars of such income. The burden shifts to the assessee only if he fails to offer any explanation for the undisclosed income or offers an explanation which is found to be false by the assessing authority. However, the proviso to Explanation 1 provides for shifting of this burden again where the explanation offered by the assessee is found to be bona fide.
In the present case, though it is true that the assessee had not surrendered at all and that he had done so on the persistent queries made by the Assessing Officer, but once the revised assessment was regularised by the revenue and once the assessing authority had failed to take any objection in the matter, the declaration of income made by the assessee in his revised returns and his explanation that he had done so to buy peace with the department and to come out of vexed litigation could be treated as bona fide in the facts and circumstances of the case. Therefore, the Tribunal was justified in cancelling the penalty levied by the Assessing Officer and affirmed by the Commissioner (Appeals) in the facts and circumstances of the case. This reference is, accordingly, answered in the affirmative holding that the Tribunal was justified in doing so.
Thus, considering that aspect of the matter the ld. AR of the assessee submitted that the question of applicability of penal provisions u/s 271(1)(c) does not arise on the returned income filed by the assessee in response to notice u/s. 148 of the Act. Keeping in mind that aspect of the matter the bench noted that in the quantum proceeding there was disallowance of Rs.1,53,549/- towards cost of improvement and Rs.36,000/- towards transfer expenses were made only due to non-submissions of bills during assessment. The ld. AR of the assessee submitted an additional evidence
14 ITANO. 192/JPR/2025 SHRI RAMCHAND LAXMANDAS BABANI VS ITO, WARD 6(4), JAIPUR including a declaration letter with ‘’Laxmi Construction’’ for improvement working amounting to Rs.93,000/- along with working of indexed cost. These documents directly support the genuineness of the claim made and demonstrate that the expenditure was actually incurred in connection with long-term capital asset sold. The ld. AR of the assessee submitted that omission was not deliberate or with the intent of concealing income and thus the penalty levied on such disallowance is not justified. To this effect, we take reference of the decision of Hon’ble Supreme Court in the case of CIT vs Reliance Petroproducts Pvt Ltd. 322 ITR 158 (SC). The relevant para 11& 12 of the order is reproduced as under:- ‘’11. In this behalf the observations of this Court made in Sree Krishna Electricals v. State of Tamil Nadu(2009) 23 VST 249 as regards the penalty are apposite. In the aforementioned decision which pertained to the penalty proceedings in Tamil Nadu General Sales Tax Act, the Court had found that the authorities below had found that there were some incorrect statements made in the Return. However, the said transactions were reflected in the accounts of the assessee. This Court, therefore, observed "So far as the question of penalty is concerned the items which were not included in the tumover were found incorporated in the appellant's account books. Where certain items which are not included in the numover are disclosed in the dealer's own account books and the assessing authorities include these items in the dealer's turnover disallowing the exemption, penalty cannot be imposed. The penalty levied stands set aside."
The situation in the present case is still better as no fault has been found with the particulars submitted by the assessee in its Return.
15 ITANO. 192/JPR/2025 SHRI RAMCHAND LAXMANDAS BABANI VS ITO, WARD 6(4), JAIPUR 12. The Tribunal, as well as, the Commissioner of Income-tax (Appeals) and the High Court have correctly reached this conclusion and, therefore, the appeal filed by the revenue has no merits and is dismissed.
Hence, in view of the above facts and circumstances of the case, the Bench does not concur with the findings of the ld. CIT(A) and thus the penalty confirmed by the ld. CIT(A)u/s 271(1)(c) of the Act amounting to Rs.2.60 lacs is directed to be deleted. 5.0 In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 21 /08/2025.