SHAILENDRA R. SHINDE,MUMBAI vs. ITO 22(3)(4), MUMBAI

सुनवाई की तायीख / : 21/07/2016 Date of Hearing घोषणा की तायीख / : 27.7.2016 Date of Pronouncement आदेश / O R D E R Per R.C. SHARMA, A. M.: This is an Appeal by the Assessee directed against the Order by the Commissioner of Income Tax (Appeals)- 26, Mumbai (‘CIT(A)’ for short) dated 10.09.2015 for the assessment year (A.Y.) 2006-07, in the matter of imposition of penalty u/s 271(1)(c) of the Act.

(A.Y. 2006-07) Shri Shailendra R. Shinde vs. ITO 2. We have gone through the orders of authorities below and found that AO levied Rs.1,42,442/- in respect of sale proceeds as per section 50C. The issue under consideration is covered by the decision in the case of ACIT vs. Mrs. N. Meenakshi 125 TTJ 0856 wherein it was held that penalty u/s 271(1)(c) cannot be imposed merely on the basis u/s 50C when it is not a case of nor furnishing of inaccurate particulars. A reading of section 50C makes it clear that the section is applicable in cases where stamp duty has been paid for transfer. Moreover, this section also postulates that the fair market value may be different from the value adopted by the registration authority and in such cases, procedure for reference to valuation cell is provided. Hence, this section is neither applicable nor it is the case of the Revenue that any reference to valuation cell has been made or that the AO has obtained independent instances of comparable sales in that period, of that area. Under such circumstances, if the assessee has accepted addition, it cannot be said that the assessee is guilty of furnishing inaccurate particulars or concealment.

The High Court in the case of Madan Theatres Limited 684/13 dated 14th 3. May,2013 held that no penalty is leviable u/s 271(1)(c) when addition is made merely on account of .. provision of section 50C of the Act.