M/s. Chakrabarty Medical Centre, Pune V. Income-tax Officer,

ITA 1137/PUN/2016

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 7262 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 4 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-09-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 24-09-2018
• Assessment Year: 2008-2009
• Appeal Filed On: 27-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJEEV GHEI
• Keywords: Capital asset; Depreciation
• Section: 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO. 1 1 37 /P U N/201 6 / ASSESSMENT YEAR : 20 08 - 09 M/S. CHAKRABARTY MEDICAL CENTRE, C - 802, PALMDALE, CALIFORNIA APARTMENTS, NIBM, UNDRI ROAD, PUNE 411060 . / APPELLANT PAN: AABFC5809Q VS. THE INCOME TAX OFFICER, W ARD 1, AHMEDNAGAR . / RESPONDENT / APPELLANT BY : SHRI NIKHIL PATHAK / RESPONDENT BY : SHRI SANJEEV GHEI / DATE OF HEARING : 2 4 . 0 9 .201 8 / DATE OF PRONOUNCE MENT: 28 . 0 9 .201 8 / ORDER PER SUSHMA CHOWLA, J M : THE APPEAL FILED BY ASSESSEE IS AGAINST ORDER OF CIT (A) - 2 , PUNE , DATED 07 .0 3 .2016 RELATING TO ASSESSMENT YEAR 20 08 - 09 AGAINST PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE INCOME - TAX ACT , 1961 ( IN SHORT THE ACT) . 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - ON FACTS AND IN LAW, 1] THE LEARNED CIT(A) ERRED IN CONFIRMING THE LEVY OF PENALTY IN RESPECT OF THE ADDITION MADE BY THE A.O. ON ACCOUNT OF SALE OF PROPERTY BY HOLDING TH AT THE ASSESSEE HAD CONCEALED ITS INCOME BY NOT OFFERING THE CAPITAL GAIN TO TAX ON SALE OF THE PROPERTY. ITA NO. 1 1 37 /P U N/20 1 6 M/S. CHAKRABARTY MEDICAL CENTRE 2 2] THE LEARNED CIT(A) ERRED IN NOT APPRECIATING THAT THE CAPITAL GAINS ON SALE OF THE PROPERTY WAS DISCLOSED BY THE TWO PARTNERS OF THE ASSESSEE FIRM IN THEIR RETURNS AND SIMPLY BECAUSE, THE CAPITAL GAIN IS FINALLY ASSESSED IN THE HANDS OF THE ASSESSEE FIRM AND NOT THE PARTNERS DOES NOT MEAN THAT THERE WAS CONCEALMENT OF INCOME AND HENCE, THE PENALTY LEVIED SHOULD BE DELETED. 3] THE LEARNED CIT(A) FAIL ED TO APPRECIATE THAT THE ISSUE INVOLVED REGARDING THE TAXATION OF CAPITAL GAIN IN THE HANDS OF THE FIRM OR THE PARTNERS WAS A DEBATABLE ONE AND HENCE, NO PENALTY COULD BE LEVIED IN RESPECT OF SUCH AN ISSUE. 3. THE ONLY ISSUE RAISED IN THE PRESENT APPEAL IS AGAINST PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT. 4. BRIEFLY, IN THE FACTS OF THE CASE, FOR THE YEAR UNDER CONSIDERATION THE ASSESSEE HAD FURNISHED RETURN OF INCOME SHOWING LOSS OF 6,480/ - . THE ASSESSEE WAS PARTNERSHIP FIRM AND WAS CARRYING ON MEDICAL PROFESSION. THE RETURN OF INCOME WAS PROCESSED UNDER SECTION 143(1) OF THE ACT. THEREAFTER, THE ASSESSING OFFICER RECORDED REASONS FOR REOPENING THE ASSESSMENT AND ISSUED NOTICE UNDER SECTION 148 OF THE ACT. IN RESPONSE TO THE SAME, THE ASSE SSEE FILED RETURN OF INCOME SHOWING ORIGINAL LOSS OF 6,480/ - . THE CASE OF ASSESSEE WAS PICKED UP FOR SCRUTINY. REASONS RECORDED FOR REOPENING THE ASSESSMENT ARE REPRODUCED UNDER PARA 3 AT PAGE 2 OF ASSESSMENT ORDER. THE SAID REASONS WERE COMMUNICATED TO THE ASSESSEE. THE ASSESSING OFFICER NOTED THAT TH E ASSESSEE HAD SOLD AN IMMOVABLE PROPERTY DURING THE YEAR UNDER CONSIDERATION. THE ASSESSEE WAS ASKED TO FILE COPY OF SALE DEED EXECUTED ON 15.11.2007 FOR CONSIDERATION OF 1.90 CRORES. THE ASSESSING OFFICER NOTED THAT HOSPITAL BUILDING AND LAND SITUATE D AT CANTONMENT EXCISE AREA ON NAGAR - AURANGABAD ROAD, EAST FACING AND ADMEASURING 1171.93 SQ.MTRS., WHICH WAS KNOWN AS CHAKRABORTY MEDICAL CENTRE, WAS SOLD ON 15.11.2007 FOR CONSIDERATION OF 1.90 CRORES TO DREAMZ INVESTMENTS. THE ASSESSING OFFICER WAS OF THE VIEW THAT SHORT TERM CAPITAL GAIN ARISES ON SALE OF SAID PROPERTY WHICH HAD NOT BEEN SHOWN IN THE ORIGINAL RETURN OF INCOME FILED AND EVEN IN THE ITA NO. 1 1 37 /P U N/20 1 6 M/S. CHAKRABARTY MEDICAL CENTRE 3 RETURN OF INCOME FILED IN RESPONSE TO NOTICE UNDER SECTION 148 OF THE ACT. THE EXPLANATION OF ASSESSE E IN THIS REGARD WAS THAT DR. M.CHAKRABARTY AND DR.(MRS.) NEELA CHAKRABARTY HAD BOUGHT THE PLOT OF LAND AND STARTED CONSTRUCTION OF BUILDING, WHICH WAS BUILT OUT OF LOAN TAKEN AND OUT OF THEIR SAVINGS. THE ASSESSEE FURTHER EXPLAINED THAT FORMAL INAUGURATI ON OF HOSPITAL TOOK PLACE ON 17.03.1991 I.E. THE DATE ON WHICH ASSESSEE FIRM WAS NOT IN EXISTENCE, HENCE IT COULD NOT BE SAID THAT THE HOSPITAL BUILDING BELONGED TO PARTNERSHIP FIRM. THE ASSESSING OFFICER DID NOT ACCEPT THE CONTENTION OF ASSESSEE ON THE G ROUND THAT HOSPITAL BUILDING WAS SHOWN AS AN ASSET IN THE BALANCE SHEET OF ASSESSEE FIRM WITH EFFECT FROM ASSESSMENT YEAR 1992 - 93, WHICH WAS THE FIRST YEAR OF PARTNERSHIP FIRM. FURTHER, DEPRECIATION WAS BEING CLAIMED ON THE SAID ASSET UPTO THE DATE OF DIS SOLUTION OF PARTNERSHIP FIRM I.E. 01.04.2008 . THE PROPERTY WAS SHOWN AS ITS ASSET AND WAS SOLD ON 15.11.2007 I.E. BEFORE DISSOLUTION OF THE FIRM. THE ASSESSING OFFICER WAS OF THE VIEW THAT THE LAND AND BUILDING BEING DEPRECIABLE ASSET, GAIN ARISING WAS T O BE ASSESSED UNDER SECTION 50 OF THE ACT AND THE SHORT TERM CAPITAL GAIN ON SALE OF LAND AND BUILDING WORKED OUT TO 1,64,76,685/ - . A S THE ASSESSEE HAD NOT SHOWN THE SAID GAIN IN ITS RETURN OF INCOME, SHOW CAUSE NOTICE WAS ISSUED TO THE ASSESSEE. THE ASSESSEE IN REPLY REITERATED ITS CONTENTION THAT HOSPITAL BUILDING WAS JOINTLY CONSTRUCTED BY DR. M. CHAKRABARTY AND H IS WIFE PARTIALLY OUT OF THEIR SAVINGS AND OUT OF LOAN TAKEN. THE HOSPITAL BUILDING WAS USED FOR THE INDIVIDUAL PROFESSION OF BOTH THE PARTNERS AND THE PARTNERSHIP FIRM CAME INTO EXISTENCE ON 01.04.1992 CONSISTING OF THREE PARTNERS I.E. DR. M. CHAKRABARTY , DR. (MRS.) NEELA CHAKRABARTY AND DR. SANDEEP CHAKRABARTY AND HENCE, IT WAS NOT THE ASSET OF ASSESSEE FIRM. THE ASSESSING OFFICER REJECTED THE CLAIM OF ASSESSEE VIDE PARA 9 OF ASSESSMENT ORDER AND HELD THAT SHORT TERM CAPITAL GAIN OF 1.64 CRORES (APPROX.) HAD ARISEN ON SALE OF LAND AND BUILDING OF HOSPITAL BEFORE ITA NO. 1 1 37 /P U N/20 1 6 M/S. CHAKRABARTY MEDICAL CENTRE 4 DISSOLUTION OF PARTNERSHIP FIRM AND WAS TAXABLE IN THE HANDS OF ASSESSEE FIRM. SINCE THE ASSESSEE HAD NOT SHOWN INCOME FROM SHORT TERM CAPITAL GAIN IN ITS RETURN OF INCOME FILED ORIGINALLY NOR IN THE RETURN OF INCOME FILED IN RESPONSE TO NOTICE UNDER SECTION 148 OF THE ACT, THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS UNDER SECTION 271(1)(C) OF THE ACT. DURING THE COURSE OF PENALTY PROCEEDINGS, THE ASSESSING OFFICER NOTED THAT APPEAL FILED BY ASSESSEE AGAINST THE ASSESSMENT ORDER HAS BEEN DECIDED AND FRESH SHOW CAUSE NOTICE WAS ISSUED TO THE ASSESSEE. THE ASSESSEE AGAIN EXPLAINED ITS POSITION AND POINTED OUT THAT HOSPITAL BUILDING WAS CONSTRUCTED BY DR. M. CHAKRABART Y AND DR.(MRS.) NEELA CHAKRABARTY, WHO HAD O BTAINED LOAN FOR CONSTRUCTION, EVEN THE HOUSE TAX WAS BEING PAID IN INDIVIDUAL NAMES, ELECTRIC METER WAS ALSO IN THEIR INDIVIDUAL NAMES. EVEN THE SALE CONSIDERATION HAS BEEN ISSUED VIDE CHEQUES IN FAVOUR OF DR. M. CHAKRABARTY AND HIS WIFE AND HENCE, BOTH OF THEM BEING REAL OWNERS OF PROPERTY HAD DECLARED CAPITAL GAINS TO THE INCOME TAX DEPARTMENT AND MADE NECESSARY INVESTMENT UNDER THE CAPITAL GAIN SCHEME. IT WAS FURTHER POINTED OUT THAT MERELY BECAUSE DEPRECIAT ION WAS CLAIMED ON THE HOSPITAL BUILDING, THE SALE THEREOF WAS TAXED AS CAPITAL GAIN IN THE HANDS OF PARTNERSHIP FIRM, WHICH WAS DEBATABLE ISSUE AND IN SUCH CIRCUMSTANCES, IT CANNOT BE PRESUMED THAT THERE WAS CONCEALMENT OR FILING OF INACCURATE PARTICULARS OF INCOME. THE ASSESSING OFFICER REJECTING THE PLEA OF ASSESSEE HELD THE ASSESSEE TO HAVE CONCEALED THE INCOME AND LEVIED PENALTY UNDER SECTION 271(1)(C) OF THE ACT AT 56,25,000/ - . 5. THE CIT(A) UPHELD LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. HOWEVER, THE ASSESSING OFFICER WAS DIRECTED TO RE - WORK THE AMOUNT OF PENALTY AFTER GIVING EFFECT TO THE ORDERS OF TRIBUNAL IN ASSESSEES OWN CASE. ITA NO. 1 1 37 /P U N/20 1 6 M/S. CHAKRABARTY MEDICAL CENTRE 5 6. THE ASSESSEE IS IN APPEAL AGAINST LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. 7. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE TOOK US THROUGH THE FACTUAL ASPECTS OF THE CASE AND POINTED OUT THAT THE LAND WAS PURCHASED IN 1988 BY THE HUSBAND AND HIS WIF E IN THEIR INDIVIDUAL NAMES AND BUILDING WAS ALSO CONSTRUCTED THEREON. THE PARTNERSHIP FIRM WAS FORMED LATER ON 06.04.1992 WHEREIN THEIR SON WAS ALSO INCLUDED AS PARTNER. HE FURTHER STATED THAT LAND AND BUILDING WAS INTRODUCED IN FIRM BY WAY OF JOURNAL E NTRIES AND THE PROPERTY WAS SHOWN IN THE BALANCE SHEET OF ASSESSEE FIRM AND DEPRECIATION WAS CLAIMED. THE LEGAL TITLE OF PROPERTY WAS IN THE NAME OF HUSBAND AND WIFE AND IN FINANCIAL YEAR 2007 - 08, THE SAID LAND AND BUILDING WAS TRANSFERRED FOR SUM OF 1. 90 CRORES. THE LONG TERM CAPITAL GAIN ARISING ON ITS SALE WAS DECLARED BY HUSBAND AND WIFE IN THEIR HANDS. HOWEVER, THE ASSESSING OFFICER HELD THE SAID ASSET TO BE OF PARTNERSHIP FIRM AND THE ENTIRE GAIN WAS WORKED OUT AS SHORT TERM CAPITAL GAIN IN THE H ANDS OF ASSESSEE FIRM. THE TRIBUNAL HAD CONFIRMED THE ADDITION MADE BY ASSESSING OFFICER. HOWEVER, IT HAD DIRECTED THAT THE LAND WAS TO BE ASSESSED AS INCOME FROM LONG TERM CAPITAL GAIN AND EXEMPTION UNDER SECTION 54EC OF THE ACT WAS DIRECTED TO BE ALL OWED AND FURTHER SALE OF BUILDING WAS TO BE ASSESSED AS SHORT TERM CAPITAL GAIN IN THE HANDS OF ASSESSEE FIRM. HOWEVER, THE ASSESSING OFFICER LEVIED PENALTY UNDER SECTION 271(1)(C) OF THE ACT ON ENTIRE AMOUNT AS BEING ASSESSED AS SHORT TERM CAPITAL GAIN. THE CIT(A) UPHOLDS THE LEVY OF PENALTY BUT DIRECTS THE ASSESSING OFFICER TO RE - WORK THE QUANTUM OF SUM TO BE LEVIED. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE STRESSED THAT THE ASSESSEE HAD MADE A BONAFIDE CLAIM WHICH WAS NOT ACCEPTED AND TH E ISSUE AT BEST IS DEBATABLE ISSUE. HE POINTED OUT THAT ON SIMILAR FACTS , THE CHENNAI BENCH OF TRIBUNAL IN RAJA FERTILIZERS VS. ITO (2013) 142 ITD 435 (CHENNAI - TRIB), DELETED THE ADDITION ON LONG TERM CAPITAL GAIN ITA NO. 1 1 37 /P U N/20 1 6 M/S. CHAKRABARTY MEDICAL CENTRE 6 MADE BY THE ASSESSING OFFICER IN THE HAND S OF PARTNERSHIP FIRM. HE THUS, STRESSED THAT THE ISSUE BEING DEBATABLE, NO PENALTY IS TO BE LEVIED UNDER SECTION 271(1)(C) OF THE ACT. IN THIS REGARD, HE PLACED RELIANCE ON THE RATIO LAID DOWN BY THE HON'BLE SUPREME COURT IN CIT VS. RELIANCE PETROPRODUC TS PVT. LTD. REPORTED IN 322 ITR 158 (SC). 8. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE ON THE OTHER HAND, PLACED RELIANCE ON THE ORDERS OF AUTHORITIES BELOW. 9. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ISSUE ARISING IN THE PRESENT APPEAL IS AGAINST LEVY OF PENALTY FOR CONCEALMENT UNDER SECTION 271(1)(C) OF THE ACT. THE ASSESSEE BEFORE US IS A PARTNERSHIP FIRM, WHICH WAS CONSTITUTED ON 01.04.1992 CONSISTING OF MR. M. CHAKRABARTY, HIS WIFE DR. (MRS.) NEELA CHAKRABARTY AND THEIR SON DR. SANDEEP CHAKRABARTY. THE ASSESSEE WAS RUNNING HOSPITAL FROM THE BUILDING. BOTH DR. M. CHAKRABRARTY AND DR. (MRS.) NEELA CHAKRABARTY HAD ORIGINALLY PURCHASED THE LAND IN THEIR INDIVIDUAL NAMES AND THEREAFTER, CONSTRUCTED BUILDING ALSO B Y UTILIZING THEIR SAVINGS AND TAKING LOAN. THE LAND WAS REGISTERED IN THE NAMES OF TWO INDIVIDUALS AND EVEN THE PROPERTY TAX AND ELECTRICITY BILL WAS ALSO IN THE NAMES OF INDIVIDUALS. HOWEVER, THE SAID LAND AND BUILDING BY WAY OF JOURNAL ENTRIES WERE INT RODUCED IN THE PARTNERSHIP FIRM AND DEPRECIATION WAS CLAIMED ON THE SAID ASSET. THE LAND AND BUILDING WERE SOLD FOR CONSIDERATION OF 1.90 CRORES DURING FINANCIAL YEAR UNDER CONSIDERATION. HOWEVER, THE GAIN ARISING THEREFROM WAS DECLARED AS LONG TERM C APITAL GAIN IN THE HANDS OF HUSBAND AND WIFE I.E. IN THE NAME OF PERSONS, IN WHICH IT WAS REGISTERED. THE SAID PERSONS ALSO CLAIMED DEDUCTION ON ACCOUNT OF INVESTMENT MADE IN BONDS. ON THE OTHER HAND, SINCE THE ASSESSEE HAD INTRODUCED THE SAID ASSET IN THE PARTNERSHIP FIRM THOUGH BY WAY OF JOURNAL ENTRIES , BUT IT WAS CLAIMING DEPRECIATION ON THE SAID ITA NO. 1 1 37 /P U N/20 1 6 M/S. CHAKRABARTY MEDICAL CENTRE 7 BUILDING. THE ASSESSING OFFICER IN SUCH CIRCUMSTANCES, WAS OF THE VIEW THAT ASSET BELONGED TO THE PARTNERSHIP FIRM AND THE ENTIRE GAIN ARISING THEREFROM WA S TO BE ASSESSED UNDER SECTION 50 OF THE ACT AS SHORT TERM CAPITAL GAIN . THE APPEAL OF ASSESSEE WAS DISMISSED BY THE CIT(A) AND EVEN THE TRIBUNAL MODIFIED THE ORDER OF ASSESSING OFFICER TO HOLD THAT GAIN ARISING ON SALE OF LAND HAS TO BE ASSESSED AS LO NG TERM CAPITAL GAIN, ON WHICH THE ASSESSEE WAS ENTITLED TO CLAIM DEDUCTION UNDER SECTION 54EC OF THE ACT. IT MAY BE POINTED OUT THAT BONDS WERE PURCHASED IN THE INDIVIDUAL NAMES OF HUSBAND AND WIFE AND NOT IN THE NAME OF PARTNERSHIP FIRM. THE TRIBUNAL FURTHER HELD THAT GAIN ARISING ON SALE OF BUILDING WAS TO BE ASSESSED AS SHORT TERM CAPITAL GAIN UNDER SECTION 50 OF THE ACT. THE PLEA OF ASSESSEE OF HAVING DECLARED LONG TERM CAPITAL GAIN ON SALE OF LAND AND BUILDING IN THE INDIVIDUAL HANDS WAS NOT ACC EPTED BY THE TRIBUNAL. 10. THE ISSUE WHICH ARISES IN THE PRESENT APPEAL IS THAT WHERE THE ASSESSEE FIRM HAD NOT DECLARED THE INCOME ARISING FROM GAIN ON TRANSFER OF LAND AND BUILDING IN ITS HANDS WHILE FILING THE RETURN OF INCOME, CAN THE ASSESSEE BE HELD TO BE EXIGIBLE TO LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. THE AFORESAID PENALTY IS LEVIABLE WHERE THE ASSESSEE HAS CONCEALED ITS INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME. THE ASSESSING OFFICER HELD THE ASSESSEE TO HAVE CONCEALED PARTICULARS OF INCOME MAKING IT LIABLE FOR LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT, WHICH WAS CONFIRMED BY THE CIT(A), AGAINST WHICH THE ASSESSEE IS IN APPEAL BEFORE US . ON THE OTHER HAND, PLEA OF ASSESSEE BEFORE US IS THAT IT HAD MADE BONAFIDE CLAIM I N THE FACTS AND CIRCUMSTANCES OF THE CASE, WHEREIN THE PROPERTY CONTINUED TO BE REGISTERED IN THE NAME OF TWO INDIVIDUALS AND EVEN THE PROPERTY TAX AND ELECTRICITY BILLS WERE IN THE NAME OF TWO OWNERS AND THE SALE DEED WAS ALSO EXECUTED BY THE SAID PERSONS AND EVEN THE INVESTMENT IN BONDS WERE MADE BY THEM . IN THIS REGARD, ITA NO. 1 1 37 /P U N/20 1 6 M/S. CHAKRABARTY MEDICAL CENTRE 8 IT WAS STRESSED THAT INCOME HAVING BEEN DECLARED IN THE INDIVIDUAL HANDS I.E. INCOME FROM LONG TERM CAPITAL GAIN AND THE SAME NOT BEING ACCEPTED THEREIN BUT BEING ASSESSED IN THE HANDS OF PARTNERSHIP FIRM, DOES NOT MAKE THE ASSESSEE LIABLE TO LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. 11. THE CHENNAI BENCH OF TRIBUNAL ON SIMILAR FACTS IN RAJA FERTILIZERS VS. ITO (SUPRA) NOTED THAT THE ASSESSEE HAD PURCHASED PIECE O F LAND AND PURCHASE DEED WAS REGISTERED IN HIS PERSONAL NAME. HOWEVER, THE SAID ASSET WAS REFLECTED IN BALANCE SHEET OF ASSESSEE FIRM AND EVEN THE FUNDS WERE WITHDRAWN FROM ASSESSEE FIRM TO FINANCE PURCHASE OF SAID PROPERTY ; CAPITAL GAIN ARISING ON SALE O F SAID PROPERTY WAS OFFERED BY THE PARTNER AS LONG TERM CAPITAL GAIN IN HIS PERSONAL ASSESSMENT AND WAS NOT DISCLOSED BY THE PARTNERSHIP FIRM. THE ASSESSING OFFICER WAS OF THE VIEW THAT SINCE THE PROPERTY WAS OWNED BY PARTNERSHIP FIRM, LONG TERM CAPITAL GAIN WAS TO BE TAXED IN THE HANDS OF FIRM. HOWEVER, THE TRIBUNAL HELD THAT IN THE ABSENCE OF ANY CONVEYANCE DEED REGISTERED IN THE NAME OF ASSESSEE FIRM, THE SAID PROPERTY COULD NOT BE HELD TO BE OWNED BY THE PARTNERSHIP FIRM. THE TRIBUNAL WAS OF THE VI EW THAT MATTERS RELATING TO ACQUIRING AND RELEASING RIGHT IN IMMOVABLE PROPERTIES, ETC. NEEDED TO BE STRICTLY CONSTRUED IN THE LIGHT OF INDIAN REGISTRATION ACT AND TRANSFER OF PROPERTY ACT. HENCE, THE ADDITION MADE OF LONG TERM CAPITAL GAIN IN THE INCOME COMPUTATION OF PARTNERSHIP FIRM WAS DELETED BY THE TRIBUNAL. IN SUCH CIRCUMSTANCES, IT CAN SAFELY BE SAID THAT THE ISSUE RAISED IN THE PRESENT APPEAL OF ASSESSABILITY OF GAIN ARISING ON SALE OF LAND AND BUILDING, WHETHER IN THE HANDS OF REGISTERED OWNER O R IN THE HANDS OF PARTNERSHIP FIRM IN WHOSE BALANCE SHEET THE SAID ASSET WAS INTRODUCED AND DEPRECIATION WAS CLAIMED FROM YEAR TO YEAR, AT BEST WAS A DEBATABLE ISSUE. THE CLAIM OF ASSESSEE FIRM OF NOT BEING LIABLE TO PAY CAPITAL GAIN ON THE GAIN ARISING F ROM TRANSFER OF SAID ASSET WAS A BONAFIDE CLAIM MADE BY THE ASSESSEE, ESPECIALLY TAKING INTO CONSIDERATION THE ITA NO. 1 1 37 /P U N/20 1 6 M/S. CHAKRABARTY MEDICAL CENTRE 9 FACT THAT GAIN ARISING THEREFROM HAS BEEN DECLARED BY THE PARTNERS IN THEIR INDIVIDUAL HANDS. IN SUCH CIRCUMSTANCES, THE ASSESSEE CANNOT BE HELD TO HAVE CONCEALED PARTICULARS OF INCOME AND BE LIABLE TO LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. WE FIND SUPPORT FROM THE RATIO LAID DOWN BY THE HON'BLE SUPREME COURT IN CIT VS. RELIANCE PETROPRODUCTS PVT. LTD. (SUPRA). CONSEQUENTLY, THE GRO UNDS OF APPEAL RAISED BY ASSESSEE ARE THUS, ALLOWED. 12 . IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON THIS 28 TH DAY OF SEPTEMBER , 201 8 . SD/ - SD/ - (ANIL CHATURVEDI) (SUSHMA CHOWLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 28 TH SEPTEMBER , 201 8 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT(A) - 2 , PUNE ; 4. THE PR. CIT - I, PUNE ; 5. 6. , , / DR A , ITAT, PUNE ; / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE