Neeraj Kumar, Uttrakhand V. ITO- 2, Kashipur

ITA 1983/DEL/2012

• Counselvise Citation: 198320114 RSA 2012
• Duration Of Justice: 3 year(s) 7 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 18-11-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 30-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P DAM KANUNJNA
• Assessee Lawyers: K SAMPATH CA SH RAJA KUMAR
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Cost of acquisition; Fair market value
• Section: 50C; 142(1); 68; 6

Judgement Text

NEERAJ KUMAR V ITO ITA NO 1983 DEL 2012 AY 2007 - 08 PENALTY U/S 271(1) (C ) 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH E: NEW DELHI BEFORE SHRI H.S.SIDHU, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 1983/DEL/2012 (ASSESSMENT YEAR: 2007 - 08) NEERAJ KUMAR, MOHAILA DILLA SINGH, JASPUR, U.S. NAGAR, JASPUR, UTTRAKHAND, PAN:ANCPK0333R VS. INCOME TAX OFFICER - 2, KASHIPUR, U.S. NAGAR, UTTRAKHAND (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. K. SAMPATH, CA : SH. RAJA KUMAR, ADV REVENUE BY : SH. P. DAM KANUNJNA, SR. DR DATE OF HEARING: - 26.11.2015 DATE OF PRONOUNCEMENT: - 0 9 /12/2015 O R D E R PER PRASHANT MAHARISHI, A. M. 01 . THE PRESENT APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LEARNED CIT (A) - II, DATED 03/02/2012 PASS ED FOR THE ASSESSMENT YEAR 2007 - 08 CONFIRMING THE PENALTY U/S 271(1) (C) OF THE INCOME TAX ACT 1961 OF RS. 4,02,000/ - . 02 . A BRIEF FACT OF THE CASE IS THAT FOLLOWING THREE ADJUSTMENTS WERE MADE TO THE INCOME OF THE ASSESSEE BY AO AND CONFIRMED BY CIT (A ). 1 . SALE CONSIDERATION OF PLOTS AT RS.20,28,436/ - INSTEAD OF THE TRUE, FACTUAL AND GENUINE AMOUNT OF RS.15,57,000/ - . NEERAJ KUMAR V ITO ITA NO 1983 DEL 2012 AY 2007 - 08 PENALTY U/S 271(1) (C ) 2 2 . COST OF ACQUISITION OF ABOVE PLOTS AT A NOTIONAL RATE INSTEAD OF THE TRUE AND GENUINE RATE OF RS.3,00,000/ - . 3 . ADDITION OF RS.4,49,000/ - IN RESPECT OF BANK DEPOSIT MADE OUT OF CASH IN HAND CARRIED FORWARD FROM PREVIOUS YEAR. 03 . THEREFORE AO HAS LEVIED PENALTY ON ALL THE ABOVE ADDITION U/S 271(1) C) OF THE ACT OF RS 4,02,000/ - WHICH IS ALSO CONFIRMED BY CIT (A) AND THEREFO RE ASSESSEE IS IN APPEAL BEFORE US. 04 . ON APPEAL BEFORE ITAT ON QUANTUM, O UT OF ABOVE ADDITIONS/ ADJUSTMENTS AT SERIAL NO 1 AND 2 ARE CONFIRMED BY ITAT AND THE THIRD ADDITION RS 4,49,000/ - HAS BEEN SET ASIDE TO THE FILE OF ASSESSING OFFICER. 05 . BEFOR E US LD AR SUBMITTED THAT THAT THERE BEING NO CONCLUSIVE EVIDENCE BEFORE THE A.O. TO PROVE THE FACT THAT ASSESSEE HAS RECEIVED ANY AMOUNT OVER AND ABOVE THE SALE CONSIDERATION MENTIONED IN THE SALE DEED, IMPOSITION OF PENALTY UNDER SECTION 271(1)(C) IS NOT IMPOSABLE. THE A.R. FURTHER SUBMITTED THAT THE PROVISION OF SECTION 50C BEING A DEEMING PROVISION, IT CANNOT BE USED FOR THE PURPOSE OF IMPOSITION OF P ENALTY UNDER SECTION 271(1)(C).H E FURTHER SUBMITTED ASSERTING THAT THE ASSESSEE HAD FURNISHED ALL MATERI AL FACTS IN THE COURSE OF ASSESSMENT PROCEEDING LIKE COPY OF SALE DEED, OTHER CONNECTED DOCUMENTS, THERE IS NO MATERIAL ON RECORD TO SHOW THAT ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF INCOME. REGARDING SECOND ADJUSTMENT OF COST OF ACQUISITION IT WAS SUBMITTED THAT ASSESSEES PROPERTY WAS IN A SMALL MOFFUSIL AREA OF JASPER AND THEREFORE THE COST OF ACQUISITION WAS ESTIMATED AT RS 3,00,000/ - AND ASSESSEE COULD NOT LAY HANDS ON CONCRETE EVIDENCE OF THE COST OF ACQUISITION AND THEREFORE NO PERFE CT VALUATION WAS OBTAINED. AO COULD GET THAT REPORT FROM SU B REGISTRAR OFFICE BUT ASSESSEE COULD NOT GET AND THEREFORE INABILITY OF ASSESSEE TO OBTAIN THE VALUATION RATES FROM GOVERNMENT AUTHORITIES CANNOT BE VIEWED AGAINST THE ASSESSEE FOR LEVY OF PENALTY. REGARDING THE ADDITION OF RS 4,49,000/ - IT WAS SUBMITTED THAT ASSESSEE HA S MAIN TAINED BALANCE SHEET AND SOURCES AND APPLICATION OF FUNDS WHICH WERE MADE AVAILABLE TO AO. THE AMOUNT OF LOAN FROM VARIOUS BANKS I S ALSO SHOWN IN THE BALANCE SHEET SUBMITTED. THE CREDIT FOR OPENING ACCUMULATED FUNDS WAS NOT GIVEN BY AO AND ADDITION WAS NEERAJ KUMAR V ITO ITA NO 1983 DEL 2012 AY 2007 - 08 PENALTY U/S 271(1) (C ) 3 MADE. THEREFORE THERE IS NO FAILURE ON PART OF THE ASSESSEE IN SUBMITTING ANY INCORRECT INFORMATION . HENCE HE SUBMITTED THAT PE NALTY SHOULD NOT BE LEVIED . 06 . THE LD. DR ASSERTED THAT THE ASSESSEE HAVING FURNISHED INACCURATE PARTICULARS WITH REGARD TO THE VALUE OF THE PROPERTY BEING AWARE OF THE FACT THAT THE STAMP VALUATION AUTHORITY HAS VALUED THE PROPERTY AT RS.20,28,436/ - FOR ST AMP DUTY PURPOSE HAS SHOWN THE VALUE AT LESSER AMOUNT FOR THE PURPOSE OF COMPUTING CAPITAL GAIN; THEREFORE, TO THAT EXTENT, THERE IS FURNISHING OF INACCURATE PARTICULARS OF INCOME AND HENCE IMPOSITION OF PENALTY UNDER SECTION 271(1)(C) IS JUSTIFIED. FOR O THER ADDITIONS HE SUBMITTED THAT ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF INCOME AND THEREFORE PENALTY IS RIGHTLY LEVIED. 07 . THE FACTS IN BRIEF OF THE CASE ARE THAT THE ASSESSEE FILED RETURN OF INCOME ON 1.4.2008 DECLARING TOTAL INCOME OF RS.65,768/ - AND AGRICULTURAL INCOME AT RS.1,36,000/ - . THE ASSESSING OFFICER COMPUTED THE TAXABLE INCOME OF THE ASSESSEE AND OBSERVED THAT THE ASSESSEE HAS CLAIMED LONG TERM CAPITAL LOSS OF RS.21,000/ - . FOR CALCULATION OF LONG TERM CAPITAL LOSS, THE ASSESSEE HAS TAKEN COST OF ACQUISITION OF THE LAND AS ON 01.04.1981 AT RS.3,00,000/ -- AND INDEXED COST OF ACQUISITION OF THE LAND AT RS.15,57,000/ - . THE ASSESSEE HAS CONSIDERED THE SALE VALUE OF RS.15,36,000/ - TO CALCULATE LONG TERM CAPITAL LOSS WHEREAS DEEMED SALES CONS IDERATION WAS RS.20,28,436/ - AS PER STAMP DUTY VALUATION U/S 50C OF THE I.T. ACT, 1961. THEREFORE, VIDE PARA 6 OF NOTICE U/S 142(1) DATED 22/10/2009 AND THROUGH SPECIFIC QUERY VIDE NOTICE U/S 142(1) DATED 25/11/2009, THE ASSESSEE WAS REQUIRED TO FURNISH C OPIES OF SALE DEEDS, BASIS AND JUSTIFICATION OF VALUING THE COST OF ACQUISITION AT RS. 3,00,000/ - AS ON 01/04/1981 AND TO JUSTIFY THE CALCULATION OF LONG TERM CAPITAL LOSS WORKED OUT AT RS.( - )21,000/ - . IN COMPLIANCE, THE COPIES OF SALE DEEDS HAVE BEEN PROD UCED AND PLACED ON RECORD. THERE IS NO DISPUTE THAT THE LAND IN A QUESTION IS AN URBAN LAND SITUATED WITHIN THE VICINITY OF MUNICIPAL AREA AND IS A CAPITAL ASSETS WITHIN THE MEANING OF SECTION 2 (14) OF THE INCOME TAX ACT WHICH HAS ALSO BEEN CONFESSED BY THE ASSESSEE HIMSELF BY CALCULATING LONG TERM CAPITAL LOSS. NOW THE DISPUTE REMAINS THAT OF VALUING THE COST OF ACQUISITION OF THE LAND AT RS, 3,00,000/ - AS ON 01/04/1981 AND ADOPTING DEEMED CONSIDERATION IN PLACE OF ACTUAL SALES CONSIDERATION TO CALCULATE LONG TERM CAPITAL GAIN/LOSS. AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE THE ASSESSING OFFICER CONCLUDED THAT NO EVIDENCES, JUSTIFICATION OR BASIS NEERAJ KUMAR V ITO ITA NO 1983 DEL 2012 AY 2007 - 08 PENALTY U/S 271(1) (C ) 4 OF CALCULATING THE COST OF ACQUISITION OF LAND AND THAT OF LONG TERM CAPITAL LOSS HAS BEEN PROVIDED. TH EREFORE, THE ASSESSEE HAS FAILED TO JUSTIFY HIS CLAIM OF CALCULATING THE COST OF ACQUISITION OF LAND AS ON 01/04/1981. FURTHER ASSESSEE FAILED TO DISCHARGE ITS OBLIGATION CAST UPON HIM AS PER PROVISIONS OF SECTION 50 C (2) OF THE ACT. ACCORDINGLY, THE AS SESSING OFFICER WORKED OUT THE CAPITAL GAIN OF THE ASSESSEE AS UNDER: - AREA OF PLOT SOLD OUT 1295.87 SQ MT COST OF ACQUISITION OF THE LAND @RS.100 PER SQ MT RS.1,29,587/ - INDEXED COST OF ACQUISITION 1,29,587X519/100 R S.6,72,556/ - SALE CONSIDERATION U/S 50C RS.20,28,436/ - LONG TERM CAPITAL GAIN (20,28,436 - 6,72,556) RS.13,55,880/ - 08 . FIRST TWO ITEMS ON WHICH PENALTY IS LEVIED BY AO ARE PERTAINING TO COMPUTATION OF CAPITAL GAIN AS UNDER : - A ) ASSESSEE CARRIED THE MATTER BEFORE CIT (A) WHO HELD THAT AS THE AO HAS ADOPTED THE VALUATION AS PER STAMP DUTY AUTHORITIES AT RS. 20,28,436/ - AGAINST THE ACTUAL CONSIDERATION RECEIVED BY THE ASSESSEE OF RS 15,36,000/ - UPHOLDING THE APPLICATION OF SECTION 50C OF THE INCOME TAX ACT . HE ALSO STATED THAT ASSESSEE DID NOT CONTEST AT ALL THAT THE VALUATION AS PER CIRCLE RATES EXCEEDED THE FAIR MARKET VALUE OF THE PROPERTY, THEREFORE ACCORDING TO HIM THEREFORE THERE IS NO CASE OF THE ASSESSEE TO CONTEST THE ADOPTION OF DEEMED CONSIDERATION AS PROVIDED U/S 50 C BY THE ASSESS E E. THEREFORE HE UPHELD THE ADOPTION OF DEEMED CONSIDERATION OF RS 20,28,436/ - BY THE AO. THIS ADJUSTMENT IS ALSO CONFIRMED BY ITAT BY THEIR ORDER IN ITA NO 989/DEL/2011 D ATED 09 /12/201 5 . B ) REGARDING COST OF ACQUISITION OF ASSETS HE FURTHER UPHELD THAT COST OF ACQUISITION OF THE PROPERTY IS RS 1,29,587/ - AGAINST THE COST OF ACQUISITION TAKEN BY ASSESSEE OF RS 3,00,000/ - . LD AO HAS TAKEN THE COST OF ACQUISITION BASED ON COPY OF NOTIFICATI ON OF THE FAIR MARKET VALUE OF THE ASSETS AS AT 1.4.1981 FROM SUB REGISTRAR, JASPUR. WHO GAVE THE RATES RANGING FROM RS 80/ - TO RS 100/ - PER SQUARE METER AND NEERAJ KUMAR V ITO ITA NO 1983 DEL 2012 AY 2007 - 08 PENALTY U/S 271(1) (C ) 5 LD AO ADOPTED RS 100/ - AS AVERAGE PRICE AMOUNTING TO RS 1,29,587/ - AND FURTHER INDEXING IT TO RS 6,72,556/ - . AGAINST THIS ASSESSEE DID NOT PROVIDE ANY BASIS FOR TAKING THE COST OF ACQUISITION AS AT 1.4.1981 OF RS 3,00,000/ - . THEREFORE CIT (A) CONFIRMED THE INDEXED COST OF ACQUISITION TAKEN BY AO AT RS. 6,72,556/ - . THIS ADJUSTMENT IS ALSO CONF IRMED BY ITAT BY THEIR ORDER IN ITA NO 989/DEL/2011 DATED 10/12/201 5 . 09 . THE THIRD ITEM OF PENALTY WAS THAT ASSESSING OFFICER FURTHER NOTICED THAT THE ASSESSEE HAS INTRODUCED A SUM OF RS.12,81,000/ - IN THE NEW PARTNERSHIP FIRM AS A PARTNER. FURTHER ASSE SSEE HAS DEPOSITED RS 9,00,000/ - DURING THE YEAR IN TWO LOAN ACCOUNTS WITH PRATHMA BANK IN TWO TRENCHES RS 6,50,000/ - AND RS 2,50,000/ - . THEREFORE TOTAL INVESTMENTS OF RS 21,81,000/ - WAS MADE BY THE ASSESSEE DURING THE YEAR. AGAINST WHICH ASSESSING OFF ICER WAS CONVINCED BOUT THE SOURCES OF RS. 17,32,000/ - BEING RS 15,36,000/ - RECEIVED TOWARDS THE SALE OF ABOVE PROPERTY AND RS 1,36,000/ - OUT OF AGRICULTURAL INCOME AND RS 60,000/ - BEING OTHER INCOME OFFERED BY THE ASSESSEE. THEREFORE AO MADE THE ADDITION OF RS 4,49,000/ - IN THE HANDS OF THE ASSESSEE U/S 68 OF THE ACT. DESPITE. PROVIDING PROPER OPPORTUNITY, THE ASSESSEE HAS NOT GIVEN ANY EXPLANATION REGARDING THIS CASH OF RS. 4,49,000/ - DEPOSITED IN THE BANKS. THE LEARNED COMMISSIONER OF INCOME - TAX (APPEA LS), HAS OBSERVED THAT THE ASSESSEE HAS NOT BEEN ABLE TO EXPLAIN THE SOURCE OF DEPOSIT OF RS.4,49,000/ - AND THE SAME HAS BEEN CORRECTLY BROUGHT TO TAX BY ASSESSING OFFICER IN TERMS OF THE PROVISIONS OF SECTION 68 OF THE ACT. THIS ADDITION HAS BEEN SET AS IDE BY ITAT VIDE THEIR ORDER IN ITA NO 989/DEL/2011 DATED 09 .12.2015 BACK TO THE FILE OF ASSESSING OFFICER. 10 . THE FIRST TWO ADDITIONS/ ADJUSTMENTS ARE MADE IN THE COMPUTATION OF LONG TERM CAPITAL GAIN ARISING ON THE SALE OF PROPERTY AND BOTH ADJUSTMEN TS ARE ON ACCOUNT OF VALUATION OF PROPERTY FIRSTLY ON ACCOUNT OF PROVISION OF SECTION 50 C AND SECONDLY IN DETERMINING FAIR MARKET VALUE OF THE PROPERTY AS AT 1 - 4 - 1981 AS COST OF ACQUISITION U/S 55(2 ) (B) OF THE INCOME TAX A CT. ON IDENTICAL FACTS ON AP PLICABILITY OF SECTION 50C FOR DEEMED SALES CONSIDERATION COORDINATE BENCH IN [2015] 43 ITR (TRIB) 487 (ITAT[HYD]) BHAVYA ANANT UDESHI V INCOME - TAX OFFICER (INTERNATIONAL TAXATION) HAS HELD AS UNDER : - NEERAJ KUMAR V ITO ITA NO 1983 DEL 2012 AY 2007 - 08 PENALTY U/S 271(1) (C ) 6 5. WE HAVE CONSIDERED THE SUBMISSIONS OF THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. AS CAN BE SEEN FROM THE FACTS AND MATERIALS ON RECORD, WHILE THE ASSESSEE COMPUTED CAPITAL GAIN ON THE BASIS OF SALE CONSIDERATION MENTIONED IN THE REGISTER ED SALE DEED, THE ASSESSING OFFICER COMPUTED THE CAPITAL GAIN BY INVOKING THE PROVISIONS OF SECTION 50C OF THE ACT AS THE REGISTERING AUTHORITY OF THE STATE GOVERNMENT HAS VALUED THE PROPERTY FOR THE PURPOSE OF STAMP DUTY AT RS. 2.55 CRORES. THOUGH, IT MAY BE A FACT THAT THE INCOME - TAX APPELLATE TRIBUNAL WHILE DECIDING THE ASSESSEE'S QUANTUM APPEAL HAS UPHELD THE APPLICATION OF SECTION 50C OF THE ACT FOR THE PURPOSE OF COMPUTATION OF CAPITAL GAIN BUT THAT ITSELF WILL NOT LEAD TO THE CONCLUSION THAT THE ASSE SSEE EITHER HAS FURNISHED INACCURATE PARTICULARS OF INCOME OR CONCEALED THE PARTICULARS OF INCOME. AS CAN BE SEEN FROM THE LANGUAGE OF SECTION 50C IT IS A DEEMING PROVISION. IN A CASE WHERE THE ASSESSING OFFICER FINDS THAT THE VALUE DETERMINED BY THE STAMP DUTY AUTHORITY FOR THE PURPOSE OF STAMP DUTY IS MORE THAN THE CONSIDERATION CLAIMED TO HAVE BEEN RECEIVED BY THE PARTY, THEN THE VALUE ADOPTED BY THE SRO SHALL BE DEEMED TO BE THE CONSIDERATION RECEIVED BY THE ASSESSEE FOR THE PURPOSE OF COMPUTATION OF CA PITAL GAIN. THUS, FOR APPLICATION OF SECTION50C OF THE ACT, IT IS NOT NECESSARY FOR THE ASSESSING OFFICER TO EXAMINE WHETHER ACTUALLY THE ASSESSEE HAS RECEIVED ANYTHING OVER AND ABOVE THE AMOUNT MENTIONED IN THE SALE DEED AS HE SIMPLY HAS TO GO BY THE VALU ATION ADOPTED BY THE SRO. HOWEVER, AS FAR AS IMPOSITION OF PENALTY IS CONCERNED, THERE MUST BE POSITIVE EVIDENCE BEFORE THE ASSESSING OFFICER TO CONCLUDE THAT THE ASSESSEE HAS RECEIVED THE AMOUNT AS VALUED BY SRO FOR STAMP DUTY PURPOSE. UNLESS THERE ARE PO SITIVE EVIDENCE TO INDICATE RECEIPT OF ON MONEY TO THE EXTENT OF VALUATION MADE BY SRO BY THE ASSESSEE, PENALTY UNDER SECTION 271(1)(C) CANNOT BE IMPOSED. FURTHER, IN THE PRESENT CASE AS IS EVIDENT FROM THE MATERIALS ON RECORD, THE ASSESSEE IN THE COURSE O F ASSESSMENT PROCEEDING HAS FURNISHED ALL NECESSARY AND RELEVANT DOCUMENTS RELATING TO THE TRANSACTION OF THE PROPERTY IN QUESTION INCLUDING REGISTERED SALE DEED. THE ASSESSEE HAS NOT SUPPRESSED ANY MATERIAL FACT FROM THE NOTICE OF THE ASSESSING OFFICER. I N THESE CIRCUMSTANCES, THE IMPOSITION OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT ALLEGING FURNISHING OF INACCURATE PARTICULARS OF INCOME OR CONCEALMENT OF INCOME, NEERAJ KUMAR V ITO ITA NO 1983 DEL 2012 AY 2007 - 08 PENALTY U/S 271(1) (C ) 7 IN OUR VIEW, IS NOT APPROPRIATE. THE INCOME - TAX APPELLATE TRIBUNAL, MUMBAI BENCH IN THE CA SE OF RENU HINGORANI, MUMBAI V. ASST. CIT, RANGE 19(3), MUMBAI (SUPRA) WHILE CONSIDERING IDENTICAL NATURE OF DISPUTE, DELETED THE PENALTY UNDER SECTION 271(1)(C) OF THE ACT BY HOLDING AS UNDER : '8. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND RELEVANT REC ORD. WE FIND THAT THE ASSESSING OFFICER HAD MADE AN ADDITION OF RS.9,00,824 BEING DIFFERENCE BETWEEN THE SALE CONSIDERATION AS PER SALE AGREEMENT AND THE VALUATION MADE BY THE STAMP VALUATION AUTHORITY. THUS, THE ADDITION HAS BEEN MADE BY THE ASSESSING OFF ICER BY APPLYING THE PROVISIONS OF SECTION 50C OF THE ACT. IT IS EVIDENT FROM THE ASSESSMENT ORDER THAT THE ASSESSING OFFICER HAS NOT QUESTIONED THE ACTUAL CONSIDERATION RECEIVED BY THE ASSESSEE BUT THE ADDITION IS MADE PURELY ON THE BASIS OF DEEMING PROVI SIONS OF THE INCOME - TAX ACT, 1961. THE ASSESSING OFFICER HAS NOT GIVEN ANY FINDING THAT THE ACTUAL SALE CONSIDERATION IS MORE THAN THE SALE CONSIDERATION ADMITTED AND MENTIONED IN THE SALE AGREEMENT. THUS IT DOES NOT AMOUNT TO CONCEALMENT OF INCOME OR FURN ISHING INACCURATE PARTICULARS OF INCOME. IT IS ALSO NOT THE CASE OF THE REVENUE THAT THE ASSESSEE HAS FAILED TO FURNISH THE RELEVANT RECORD AS CALLED BY THE ASSESSING OFFICER TO DISCLOSE THE PRIMARY FACTS. THE ASSESSEE HAS FURNISHED ALL THE RELEVANT FACTS, DOCUMENTS/MATERIAL INCLUDING THE SALE AGREEMENT AND THE ASSESSING OFFICER HAS NOT DOUBTED THE GENUINENESS AND VALIDITY OF THE DOCUMENTS PRODUCED BEFORE HIM AND THE SALE CONSIDERATION RECEIVED BY THE ASSESSEE. UNDER THESE FACTS AND CIRCUMSTANCES, IT CANNOT BE SAID THAT THE ASSESSEE HAS NOT FURNISHED CORRECT PARTICULARS OF INCOME. MERELY BECAUSE THE ASSESSEE AGREED FOR ADDITION ON THE BASIS OF VALUATION MADE BY THE STAMP VALUATION AUTHORITY WOULD NOT BE A CONCLUSIVE PROOF THAT THE SALE CONSIDERATION AS PER T HIS AGREEMENT WAS INCORRECT AND WRONG. ACCORDINGLY THE ADDITION BECAUSE OF THE DEEMING PROVISIONS DOES NEERAJ KUMAR V ITO ITA NO 1983 DEL 2012 AY 2007 - 08 PENALTY U/S 271(1) (C ) 8 NOT IPSO FACTO ATTRACT THE PENALTY UNDER SECTION 271(1)(C). HENCE IN VIEW OF THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF CIT V. RELIANCE PET RO PRODUCTS P. LTD. [2010] 322 ITR 158 (SC), THE PENALTY LEVIED UNDER SECTION 271(1)(C) IS NOT SUSTAINABLE. THE SAME IS DELETED.' 6. THE PRINCIPLES LAID DOWN IN OTHER DECISIONS RELIED UPON BY THE LEARNED AUTHORIZED REPRESENTATIVE ALSO EXPRESS SIMILAR VIEW. FOLLOWING THE CONSISTENT VIEW EXPRESSED IN THE DECISIONS REFERRED TO ABOVE, WE ARE OF THE OPINION THAT IMPOSITION OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT IN THE PRESENT CASE IS NOT VALID. ACCORDING LY, WE DELETE THE PENALTY. THEREFORE FOLLOWING THE DECISION OF COORDINATE BENCH WE DELETE THE PENALTY U/S 271(1) (C) OF THE ACT ON ADOPTION OF DEEMED SALES CONSIDERATION APPLYING THE PROVISION OF SECTION 50 C OF THE ACT. 11 . FURTHER ON SECOND ITEMS OF ADJUSTMENT WHERE IN FAIR MARKET VALUE OF THE PROPERTY AS AT 1 - 4 - 1981 IS ADOPTED BY THE ASSESSEE AGAINST THE ACTUAL COST OF ACQUISITION WE ARE OF THE VIEW THAT FOR NOT SUBSTANTIATING THE AMOUNT BY THE ASSESSEE , ASSESSEE CANNOT BE PENALIZED. THE RATES TAKEN BY SUB REGISTRAR MAY BE RATES OF NEARBY PROPERTIES BUT THAT DOES NOT ESTABLISH THAT ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF INCOME . T HEREFORE WE ARE OF THE OPINION THAT , LOOKING TO THE FACTS AND CIRCUMSTANCES OF THE CASE, IT IS NOT A FIT CASE FOR LEVY OF PENALTY U/S 271(1) ( C) OF THE ACT AND THEREFORE WE REVERSE THE ORDER OF CIT (A) ON THIS COUNT AND DE LETE THE PENALTY ON THIS ADJUSTMENTS. 12 . THE THIRD ADDITION ON WHICH PENALTY HAS BEEN LEVIED IS ON EXCESS OF AMOUNT DEPOSITED WI TH BANKS AND FIRMS THAN THE AVAILABLE SOURCES OF FUNDS AMOUNTING TO RS 4,49,000/ - . AGAINST THIS ADDITION ASSESSEE HAS SUBMITTED THE DETAILED BALANCE SHEET AND PROFIT AND LOSS ACCOUNT AND ALSO SUBMITTED THAT THE CREDIT FOR EARLIER YEARS INCOME WAS N OT GRANTED. THIS ISSUE HAS BEEN SET ASIDE TO THE FILE OF AO BY ORDER OF ITAT ( SUPRA) . THEREFORE AS ASSESSEE HAS FURNISHED COMPLETE DETAILS BUT COULD NOT PR ODUCE TO THE SATISFACTION OF AO ABOUT THE SOURCES AND APPLICATION OF FUNDS AND THEREFORE ADDIT IONS HAVE BEEN MADE WHICH ARE SET ASIDE TO THE FILE OF AO FOR FURTHER VERIFICATION. FURTHER IT NEERAJ KUMAR V ITO ITA NO 1983 DEL 2012 AY 2007 - 08 PENALTY U/S 271(1) (C ) 9 IS NOT THE CASE OF THE AO THAT ANY EVIDENCE SUBMITTED BY THE ASSESSEE WAS FALSE OR INCORRECT. THEREFORE WE DELETE PENALTY U/S 271(1) ( C) OF THE ACT ON THIS ADDITION REVERSING THE ORDER OF CIT (A). 13 . IN THE RESULT , WE REVERSE THE ORDER OF CIT (A) CONFIRMING THE PENALTY U/S 271(1) (C) OF THE ACT OF RS 4,02,000/ - AND IN RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 0 9 .1 2 .2015. - S D / - - S D / - (H.S.SIDHU) (PRASHANT MAHARISHI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 0 9 /1 2 /2015 A K KEOT COPY FORWARDED TO 1 . APPLICANT 2 . RESPONDENT 3 . CIT 4 . CIT (A) 5 . DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI