SHRI AJIT KUMAR JAIN, Indore V. THE ITO 4(1), Indore

ITA 282/IND/2014

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0379 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 3 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-07-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 10-06-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 21-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Assessee Lawyers: GIRISH AGARWAL
• Keywords: Reopening of assessment; Cost of acquisition
• Section: 131; 27; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, J.M. AND SHRI B.C.MEENA, A.M. I.T.A.NO. 282/IND/2014 A.Y. : 2008-09 SHRI AJIT KUMAR JAIN, ITO, 212, ANOOP NAGAR, VS. 4(1), INDORE INDORE APPELLANT RESPONDENT PAN NO. ABHPJ9429N APPELLANT BY : SHRI GIRISH AGARWAL, C. A. RESPONDENT BY : SHRI R.A.VERMA, SR. DR DATE OF HEARING : 10 . 0 6 .201 5 DATE OF PRONOUNCEMENT : 30 . 0 7 .201 5 -: 2: - 2 O R D E R PER GARASIA, J.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A)-II, INDORE, DATED 31.01.2014 FOR THE ASS ESSMENT YEAR 2008-09. 2. THE SHORT FACTS OF THE CASE ARE THAT THE ASSESSEE F ILED THE RETURN OF INCOME AND LONG TERM CAPITAL LOSS OF RS. 4,33,883/- WAS SHOWN. IN THE ASSESSMENT PROCEEDINGS , THE LOSS WAS RECOMPUTED AND LONG TERM CAPITAL GAIN WAS SHOWN AT RS. 3,50,138/-. THE AO HAS GIVEN THE REASON, WHEREI N THE AO HAS WORKED OUT THE CAPITAL GAIN, WORKED OUT THE DET AILED LOG TERM CAPITAL GAIN AFTER APPLYING THE CORRECT INDEXA TION. IT HAS BEEN ALSO STATED BY THE ASSESSING OFFICER THAT THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS HAS ADM ITTED THE MISTAKE AND OFFERED TO PAY LONG TERM CAPITAL GAIN A T RS. 3,50,138/-. 3. THE MATTER CARRIED TO LD. CIT(A). THE LD. CIT(A) HA S DISMISSED THE APPEAL. THEREFORE, THE ASSESSEE IS IN APPEAL BEFORE US. -: 3: - 3 4. THE LD. AUTHORIZED REPRESENTATIVE HAS FILED THE WRI TTEN SUBMISSIONS, WHICH READS AS UNDER :- LD. AO HAS LEVIED A CHARGE OF CONCEALMENT FOR IMPOSING THE PENALTY, WHICH FROM THE FACTS OF THE CASE, IS GROSSLY INCORRECT IT'S A CASE OF GENUINE AND BONA FIDE MISTAKE COMMITTED IN APPLYING INDEXATION FOR CALCULATING 'INDEXED COST OF ACQUISITION' FOR COMPUTING LONG TE RM CAPITAL GAIN ON SALE OF BUILDING SUPER STRUCTURE ACTUAL AND REAL COST OF ACQUISITION OF RS. 4,02,347 AS SHOWN IN THE RETURN FILED, SUBMISSION MADE FOR RE-C OMPUTING THE CAPITAL GAIN AND BALANCE SHEETS, IS ACCEPTED AN D UNDISPUTED BY THE INCOME TAX AUTHORITIES IN ALL THE PROCEEDING S LAST ADDITION / IMPROVEMENT TO THE BUILDING STRUCTURE WAS MADE IN THE YEAR 1996-97, AFTER WHICH THE TOTAL COST REMAINED CONSTANT AT THE FIGUR E OF RS. 4,02,347 IN SUBSEQUENT YEARS THE BUILDING SUPER STRUCTURE FIRST CAME INTO -: 4: - 4 EXISTENCE IN THE YEAR 1982-83 AS THE LEASE FOR LAND WAS EXECUTED IN JANUARY 1981 THE PRIMARY REASONS FOR OCCURRENCE OF THIS BONA FIDE MISTAKE ARE ATTRIBUTABLE TO THE FOLLOWING - 1) THE BUILDING BEING MORE THAN 25 YEARS OLD 2) THE ASSESSEE BEING NOT CONVERSANT WITH THE APPLICATION OF INDEX NUMBERS FOR CALCULATING INDEXED COST ON EACH YEAR OF ADDITION / IMPROVEMENT SEPARATELY. 3) REFERENCE BY COUNSEL TO LAST FEW YEARS' BALANCE SHEETS GAVE THE SAME FIGURE OF RS. 4,02,347 AS THE COST OF BUILDING SUPER STRUCTURE, TO WHICH THE INDEXATION WAS APPLIED FROM THE YEAR WHEN THE SAID STRUCTURE FIRST CAME IN TO EXISTENCE I.E. 1982-83 THE EXPRESSION 'MISTAKE' HAS NOT BEEN DEFINED IN THE ACT. IN THE ORDINARY PARLANCE IT IS UNDERSTOOD -: 5: - 5 TO BE SYNONYMOUS WITH AN ERROR. THE MEANING OF 'MISTAKE' AS GIVEN IN THE CHAMBERS CONCISE DICTIONARY IS TO THINK OR UNDERSTAND WRONGLY, TO TAKE FOR ANOTHER THING OR PERSON, TO BE WRONG ABOUT. ONE OF THE MEANINGS GIVEN FOR THE WORD 'MISTAKE' IS THAT IT IS AN OMISSION MADE NOT BY DESIGN BUT MISCHANCE. IN OTHER WORDS, THE MISTAKE MUST BE SO PLAIN OR OBVIOUS THAT IT COULD BE REALISED WITHOUT A DEBATE. IT IS IMMATERIAL AS TO HOW THE MISTAKE OCCURRED, OR WHO WAS RESPONSIBLE FOR IT. LD. AO HAS LEVIED A CHARGE OF 'CONCEALMENT' FOR IMPOSING THE PENALTY. THE MEANING OF THE WORD 'CONCEALMENT' AS FOUND IN SHORTER OXFORD ENGLISH DICTIONARY, 3RD EDITION, VOLUME I, IS AS FOLLOWS 'IN LAW, THE INTENTIONAL SUPPRESSION OF TRUTH OR FACT KNOWN, TO THE INJURY OR PREJUDICE OF ANOTHER.' -: 6: - 6 THE WORD 'CONCEALMENT' INHERENTLY CARRIES WITH IT T HE ELEMENT OF MENS REA. IN THE PRESENT CASE, THE ASSESSEE NEVER HAD ANY INTENTION TO SUPPRESS THE TRUE FACTS OR CAUSE INJURY. ALL THE MATERIAL AND RELEVANT FACTS WERE SUBMITTED AND SUBSTANTIATED WITH NECESSARY DOCUMENTARY EVIDENCES WHICH LD. AO NEVER CONTROVERTED OR DISPUTED. DURING ASSESSMENT PROCEEDINGS WHILE SUBMITTING THE DETAILS OF CONSTRUCTION COST, IT WAS REALIZED THAT A MISTAKE HAS OCCURRED WHICH WAS CORRECTED VIDE LETTER DATED 27/09/2010 BY RE-COMPUTING THE LONG TERM CAPITAL GAIN ALL THE NECESSARY DOCUMENTARY EVIDENCES WERE FILED IN SUPPORT OF THE ACTUAL COST RS. 4,02,347 WHICH IS ACCEPTED BY THE LD. AO AND IS UNDISPUTED. ALL THE MATERIAL AND RELEVANT FACTS TO THE COMPUTATION OF LTCG WERE DULY FURNISHED AND NO DEFICIENCIES IN FURNISHING OF SUCH FACTS ARE -: 7: - 7 POINTED OUT BY THE DEPARTMENT. ACCORDINGLY, DEEMING FICTION OF EXPLANATION 1 TO SECTION 271(L)(C) IS NOT APPLICABLE IN THE PRESENT CASE NON FILING OF APPEAL AND ACCEPTANCE OF MISTAKE FORMED THE BASIS FOR THE LD. AO TO LEVY A CHARGE OF 'CONCEALMENT' THEREBY IMPOSING A PENALTY OF RS. 75,000 LD. CIT(A) FAILED TO APPRECIATE THE CORRECT FACTS O F THE CASE AND IGNORED THE VARIOUS CASE LAWS QUOTED BY THE APPELLANT BY GIVING A GENERAL SWEEPING REMARK AND WITHOUT POINTING ANY SPECIFIC REASON FOR DISTINGUISHING THEM LD. CIT(A) INCORRECTLY APPLIED THE DECISION OF MAK DATA (SUPRA) WITHOUT APPRECIATING THE FACTS AND WITHOUT GIVING AN OPPORTUNITY TO DISTINGUISH THE SAME. THE KEY POINTS TO DISTINGUISH THE SAID DECISION FROM THE IMPUGNED CASE ARE TABULATED AS UNDER -: 8: - 8 S. NO. MAK DATA (P) LTD. (SUPRA) ASSESSEE IN THE PRESENT CASE 1. SURVEY CONDUCTED IN CASE OF SISTER CONCERN OF THE ASSESSEE NO SURVEY IN THE CASE OF ASSESSEE 2. AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS HAS NOTICED THAT CERTAIN DOCUMENTS HAVE BEEN IMPOUNDED IN THE COURSE OF SURVEY PROCEEDINGS, IN THE CASE OF SISTER CONCERN. NO IMPOUNDING OF ANY MATERIAL IN THE CASE OF THE ASSESSEE 3. ABSENCE OF ANY 'EXPLANATION' BY THE ASSESSEE WHICH AO IN HIS ENQUIRY FOR SPECIFIC INFORMATION, COULD HAVE CONSIDERED IN TERMS OF FIRST PART OF CLAUSE (A) OF EXPLANATION 1 TO SECTION 271(L)(C) ASSESSEE HAS GIVEN BONA FIDE EXPLANATION AT ALL THE STAGES, WHICH WAS NOT PROVED WRONG: A) IN THE STATEMENT RECORDED B) IN THE SUBMISSION DURING ASSESSMENT PROCEEDINGS C) IN THE SUBMISSION DURING PENALTY PROCEEDINGS 4. CONDUCT OF THE ASSESSEE NOT BONA FIDE AND COOPERATIVE - THE SURVEY WAS CONDUCTED MORE THAN 10 MONTHS BEFORE THE ASSESSEE FILED ITS RETURN OF INCOME. HAD IT BEEN THE INTENTION OF THE ASSESSEE TO MAKE FULL AND TRUE DISCLOSURE OF ITS INCOME, IT WOULD HAVE FILED THE RETURN DECLARING AN INCOME INCLUSIVE OF THE AMOUNT WHICH WAS SURRENDERED LATER DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS. ASSESSEE ACCEPTED THE MISTAKE COMMITTED AND SUBSTANTIATED WITH ALL THE DOCUMENTARY EVIDENCES THE 'ACTUAL COST OF CONSTRUCTION' WHICH IN ALL CASES REMAINED SAME - RS. 4,02,347. THE ASSESSEE DEPOSITED THE APPLICABLE TAX WITH INTEREST AND DID NOT GO INTO APPEAL ON THE MATTER. 5. ASSESSEE HAD NO INTENTION TO DECLARE ITS TRUE INCOME. HON'BLE APEX COURT NOTED - 'CONSEQUENTLY, IT IS CLEAR THAT THE ASSESSEE HAD NO INTENTION TO DECLARE ITS TRUE INCOME.' DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE AND THE HIS COUNSEL OWNED THE MISTAK E IN APPLYING THE INDEXATION WHILE CALCULATING INDEXED COST OF ACQUISITION FOR COMPUTING LONG TERM CAPITAL GAIN, SUBMITTED ALL THE DETAILS TO THE SATISFACTION OF THE LD. AO AND PAID THE TAXES WITH INTEREST. APPELLANT CONTINUES TO PLACE RELIANCE ON ALL THE DE CISIONS SUBMITTED BEFORE THE LD. CIT(A) VIDE WRITTEN SUBMIS SION DATED 09.12.2013. FURTHER RELIANCE IS PLACED ON THE FOLLO WING JUDGEMENTS - -: 9: - 9 SKYLINE AUTO PRODUCTS PVT LTD [2004] 271ITR 335 (MP) - SPECIFIC PARA 2 SRI SARADHA TEXTILE PROCESSORS P LTD [2006] 286 ITR 499 (MAD.) - 2 ND LAST PARA MERIDIAN IMPEX [2014] 47 TAXMANN.COM 51 (RAJKOT) (TM) - SPECIFIC PARA 7 - WHEREIN IT HAS DEALT WITH THE GENERALIZED APPROACH OF THE DEPARTMENT OF AUTOMATIC LEVY OF PENALTY IN CASES WHERE ADDITIONS OR DISALLOWANCES ARE MADE SHRIRAM PROPERTIES AND CONSTRUCTIONS (CHENNAI) LTD. [2013] 40 TAXMANN.COM 48 (MADRAS) - SPECIFIC PARA 6 SOCIETEX [2012] 24 TAXMANN.COM 309 (DELHI HC) - SPECIFIC PARA 4 AND 6 PAHARPUR INDUSTRIES LTD. [2010] 7 TAXMANN.COM 70 (DELHI HC) - SPECIFIC PARA 13,18 AND 22 -: 10: - 10 PROVISIONS OF SECTION 274(2) MANDATORILY REQUIR E A PRIOR APPROVAL OF THE JOINT COMMISSIONER WHERE AN ORDER IMPOSING A PENALTY EXCEEDING RS. 10,000 IS MADE BY AN INCOME TAX OFFICER (ITO). IN THE INSTANT CASE, LD. AO BEING AN ITO DID NOT COMPLY WITH THIS REQUIREMENT AND TOOK THE PRIOR APPROVAL FROM ADDL. CIT AS NOTED IN THE IMPUGNED ORDER INSTEAD OF JOINT COMMISSIONER. THE IMPUGNED CASE IS A CASE OF USE OF INAPPROPRIATE AUTHORITY WHERE LAW REQUIRES A PRIOR APPROVAL FROM A SPECIFIC INCOME TAX AUTHORITY AS PRESCRIBED U/S 116(CC) VERSUS 116(CCA). RELIANCE IS PLACED ON THE DECISION OF HON'BLE BOMBAY HIGH COURT IN THE CASE OF GHANSHYAM K. KHABRANI [2012] 20 TAXMANN.COM 716. THE HEAD NOTE READS AS UNDER - SECTION 151 OF THE INCOME-TAX ACT, 1961 - INCOME ESCAPING ASSESSMENT - SANCTION FOR ISSUE -: 11: - 11 OF NOTICE - ASSESSMENT YEAR 2004-05 - WHETHER WHEN STATUTE MANDATES SATISFACTION OF A PARTICULAR FUNCTIONARY FOR EXERCISE OF A POWER, SATISFACTION MUST BE OF THAT AUTHORITY - HELD, YES - WHETHER SINCE SECTION 151(2) MANDATES THAT SANCTION TO BE TAKEN FOR ISSUANCE OF NOTICE UNDER SECTION 148 IN CERTAIN CASES HAS TO BE OF JOINT COMMISSIONER, REOPENING OF ASSESSMENT WITH APPROVAL OF COMMISSIONER IS UNSUSTAINABLE - HELD, YES [IN FAVOUR OF ASSESSEE] CONSIDERING THE ABOVE SUBMISSIONS, THE APPEAL MAY PLEASE BE ALLOWED BY DELETING THE PENALTY OF RS. 75,000 LEVIED U/S 271(L)(C) OF THE ACT, FOR WHICH Y OUR APPELLANT SHALL EVER REMAIN OBLIGED. 5. THE LD. SENIOR D.R. RELIED UPON THE ORDER OF THE CI T(A) AND LD. SENIOR D.R. SUBMITTED THAT THE DECISION OF MAK DATA PRIVATE LIMITED VS. CIT, 358 ITR 593 (S.C.) IS APPL ICABLE. THEREFORE, THE ASSESSEE HAS SURRENDERED THE INCOME AFTER -: 12: - 12 DETAILED ENQUIRY MADE BY THE ASSESSING OFFICER AND OFFERED THE AMOUNT FOR TAXATION. THEREFORE, THE PENALTY WAS RIG HTLY LEVIED. 6. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES. LOOKING TO THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND THAT THE POSITION OF LAW REGARDING LEVY OF PENALTY U/S 271(1)(C) HAS UNDERGONE A SUBSTANTIAL CHANGE AFTER INSERTION OF EXPLANATION I TO SECTION 271(1)(C) WITH EFFECT FROM 01.04.1976. EXPLANATION 1 TO SECTION 271(1)(C) RAISES A PRESUMP TION THAT AS AND WHEN ANY AMOUNT IS ADDED OR DISALLOWED IN CO MPUTING THE TOTAL INCOME, THE SAME SHALL BE DEEMED OR REPRE SENT THE INCOME IN RESPECT OF WHICH THE PARTICULARS HAVE BEE N CONCEALED. FURTHER WITH EFFECT FROM 10.9.1986 AMEND MENT HAS BEEN MADE TO EXPLANATION 1(B) TO SECTION 271(1)(C), AFTER THIS AMENDMENT FURTHER ONUS HAS BEEN PLACED ON THE ASSES SEE TO PROVE THAT EXPLANATION FURNISHED BY HIM WAS BONA FI DE. THE POSITION NOW IS THAT UNLESS AND UNTIL THE ASSESSEE SUBSTANTIATES THE EXPLANATION AND PROVES THAT THE E XPLANATION WAS BONA FIDE, THE ADDITION MADE TO HIS INCOME SHAL L BE DEEMED TO REPRESENT THE CONCEALED INCOME. ON ANALYS IS OF PROVISIONS OF SECTION 271(1)(C), IT IS OBSERVED THA T EXPLANATION -: 13: - 13 1 TO SECTION 271(1)(C) PROVIDES THE SITUATION, WHER E NO EXPLANATION FOR THE FAILURE IS OFFERED BY THE ASSES SEE OR WHERE THE EXPLANATION THAT HAS BEEN OFFERED IS FOUND TO B E FALSE OR WHERE THE ASSESSEE IS NOT ABOUT TO SUBSTANTIATE THE EXPLANATION OFFERED BY HIM. IN ALL THE CASES, THE A MOUNT ADDED OR DISALLOWED IN COMPUTING THE TOTAL INCOME OF SUCH PERSON SHALL BE DEEMED TO REPRESENT THE INCOME IN RESPECT OF WHICH THE PARTICULARS HAVE BEEN CONCEALED. AS PER PROVISO TO THIS EXPLANATION, THE ONUS TO ESTABLISH THAT EXPLANATION OFFERED WAS BONA FIDE AND FACTS RELATING TO SAME AND MATERIAL T O THE COMPUTATION OF HIS INCOME EVEN DISCLOSED BY HIM WIL L BE ON THE PERSONS CHARGED FOR CONCEALMENT. AS PER THE PROVISIONS 2 TO EXPLANATION 1(B) NOW TH E ENTIRE ONUS IS ON THE ASSESSEE TO NOT ONLY OFFER AN EXPLAN ATION BUT ALSO TO SUBSTANTIATE IT AND TO PROVE THAT THE PRESU MPTION WAS BONA FIDE. AT THE SAME TIME THE PRESUMPTION SO RAIS ED BY THE EXPLANATION 1 IS REBUTTABLE. THE EFFECT IS THAT UNL ESS AND UNTIL REBUTS THE PRESUMPTION, HE WOULD BE LIABLE TO PENAL TY U/S 271(1)(C) OF THE INCOME-TAX ACT, 1961. IT IS NOW ES TABLISHED LAW THAT PRESUMPTION WOULD NOT STAND REBUTTED MERELY BY -: 14: - 14 FURNISHING ANY GENERAL OR FANTASTIC OR FANCIFUL OR UNREASONABLE EXPLANATION BY THE ASSESSEE, THE EXPLANATION SHOULD BE BASED ON COGENT AND RELEVANT MATERIAL AND SHOULD BE ACCEP TED TO THE AUTHORITIES. 10. THE EXPRESSION FURNISHING THE INACCURATE PA RTICULARS OF INCOME HAS BEEN NOT DEFINED IN THE ACT. THE EXP RESSION INACCURATE REFERS TO NOT ONLY IN CONFORMITY WITH THE FACT OR TRUTH AND THAT IS AMENDMENT, WHICH IS RELEVANT IN T HE CONTEXT OF FURNISHING INACCURATE PARTICULARS. THE MEANING B Y FURNISHING INACCURATE PARTICULARS OF INCOME IMPLIES FURNISHING OF DETAILS OR INFORMATION ABOUT THE INCOME WHICH AR E NOT IN CONFORMITY WITH THE FACT OR TRUTH. THE DETAILS OR I NFORMATION ABOUT INCOME DEALS WHICH ARE FACTUAL DETAIL OF INCO ME AND THIS CANNOT BE EXTENDED TO THE AREA, WHICH ARE SUBJECTIV E SUCH AS STATUS OF TAXABILITY OF INCOME, ADMISSIBILITY OF DE DUCTION AND INTERPRETATION OF LAW. FURNISHING OF INACCURATE INF ORMATION, THUS, RELATES TO FURNISHING THE FACTUAL INCORRECT D ETAILS AND INFORMATION ABOUT THE INCOME. THE ADMISSION OR REJE CTION OF A CLAIM SUBJECT TO EXERCISE AND WHETHER THE CLAIM IS ACCEPTED OR -: 15: - 15 REJECTED HAS NOTHING TO DO WITH FURNISHING OF INACC URATE PARTICULARS OF INCOME. RAISING A LEGAL CLAIM, EVEN IF IT IS ULTIMATELY FOUND TO BE LEGALLY UNACCEPTABLE CANNOT AMOUNT TO FURNISHING OF INACCURATE PARTICULARS OF INCOME. WE FIND THAT, IN THIS CASE, THE ASSESSEE HAS MADE A BONA FIDE LEGAL CLAIM, WHICH WAS NOT ACCEPTED BY THE TAX AUTHORITY OR JUD ICIAL AUTHORITY. WE FIND THAT THE ASSESSEES CLAIM WAS NO T ACCEPTED BY THE AUTHORITY, IT DOES NOT MEAN THAT THE ASSESSE E HAS FURNISHED INACCURATE PARTICULARS OF INCOME. THE HON 'BLE SUPREME COURT IN THE CASE OF UNION OF INDIA VS. RAJASTHAN SPINNING AND WEAVING MILLS REPORTED IN (2009) 13 SCC 448, CONSIDERED THE EARLIER DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF UNION OF INDIA AND ORS VS. DHARMENDRA TEXTILES PROCESSORS & ORS., REPORTED IN (2008) 306 ITR 277 (SC) AND HELD THAT IT GOES WITHOUT SAYING THAT FOR APPLICABILITY OF SECTION 27 1(L)(C) OF THE ACT, CONDITION STATED THEREIN MUST EXIST. THE A BOVE SAID DECISION CAME UP FOR CONSIDERATION IN THE CASE OF COMMISSIONER OF INCOME TAX VS. RELIANCE PETROPRODUC TS PVT., LTD., REPORTED IN (2010) 322 ITR 158 (SC). ON -: 16: - 16 READING OF SECTION 271(1)(C) , THE HON'BLE SUPREME COURT POINTED OUT THAT IN ORDER TO BRING THE CASE UNDER S ECTION 271(1)(C), THERE HAS TO BE CONCEALMENT OF THE PARTI CULARS OF THE INCOME OF THE ASSESSEE. SECONDLY, THE ASSESSEE MUST HAVE FURNISHED INACCURATE PARTICULARS OF HIS INCOME. IN ORDER TO EXPOSE THE ASSESSEE TO PENALTY, UNLESS THE CASE IS STRICTLY COVERED BY THE PROVISION, THE PENALTY PROVISION COU LD NOT BE INVOKED. THUS, THE HON'BLE SUPREME COURT POINTED OU T THAT A MERE MAKING OF CLAIM, WHICH IS NOT SUSTAINABLE IN LAW, BY ITSELF, WOULD NOT AMOUNT TO FURNISHING OF INACCURAT E PARTICULARS REGARDING THE INCOME OF THE ASSESSEE. T HE READING OF THE DECISION OF THE HON'BLE SUPREME COUR T REFERRED TO ABOVE, THUS POINTS OUT THAT FOR SUSTAIN ING PENALTY, THE BONA FIDE EXPLANATION OF THE ASSESSEE MUST BE LOOKED AT, SO THAT THE CONTUMACIOUS CONDUCT OF THE ASSESSEE FOR THE PURPOSE OF SUSTAINING THE PENALTY WOULD BE TAKEN AS CONDITION THAT IS THE MAIN REQUIREMENT UND ER SECTION 271(L)(C) OF THE ACT. REFERRING TO THE DECI SION IN THE CASE OF DHARMENDRA TEXTILE PROCESSORS, (SUPRA), THE HON'BLE SUPREME COURT POINTED OUT THAT IN THE BACKG ROUND -: 17: - 17 OF SECTION 271(L)(C) OF THE ACT, THERE IS NO NECESS ITY OF MENS REA BEING SHOWN BY THE REVENUE, HOWEVER REFERRING TO TH E EXPLANATION TO SECTION 271(L)(C) PENALTY BEING A MULTIPLE LIABILITY, THE BONA FIDE OF THE CONDUCT OF THE ASSE SSEE NECESSARILY ASSUMES SIGNIFICANT EVEN THOUGH WILLFUL NESS OF THE ASSESSEE MAY NOT BE A CRITERIA, THE CONDUCT IS TO BE CONSIDERED. THUS, A MERE FACT THAT THE ADDITION IN THIS CASE HAS BEEN SUSTAINED BY THIS COURT BY ITSELF WOULD NO T LEAD TO THE AUTOMATIC APPLICATION TO SECTION 271(L). 7. WE FIND THAT IN THIS CASE THE ASSESSEE WHILE FILING THE RETURN, HE HAS MADE A BONA FIDE CLAIM AND WHILE FIL ING THE RETURN, THE ASSESSEE HAS WORKED OUT THE LONG TERM C APITAL LOSS OF RS. 4,33,883/- IN HIS RETURN AND ASSESSEE CONTEN DED BEFORE THE AO THAT WHILE CALCULATING THE COST OF CONSTRUCT ION, HE HAS WORKED OUT THE COST OF CONSTRUCTION AND RS. 4,02,34 7/- AND NO DOCUMENTARY EVIDENCE WAS SUBMITTED, BUT THE CONSTRU CTION WAS CARRIED OUT LATER ON. THEREFORE, THE INDEXATION WHICH WAS CLAIMED BY THE ASSESSEE WAS NOT ALLOWED AND THE AO HAS RECOMPUTED THE INDEXATION COST AND IT WAS REVISED A ND THE -: 18: - 18 ADDITION WAS MADE AND CAPITAL LOSS WAS TURNED INTO CAPITAL GAIN AND DURING THE COURSE OF ASSESSMENT PROCEEDING S, THE ASSESSEE HAS ADMITTED THIS CLAIM AND THEREAFTER THE ASSESSEE HAS NOT FILED THE APPEAL AGAINST THE FINDING OF THE AO AND ASSESSEE HAS ADMITTED THE MISTAKE WHICH WAS COMMITT ED IN THE RETURN OF INCOME. 8. WE FIND THAT THE HON'BLE SUPREME COURT IN THE CASE OF UNION OF INDIA VS. RAJASTHAN SPINNING AND WEAVIN G MILLS REPORTED IN (2009) 13 SCC 448, CONSIDERED THE EARLIER DECISION OF THE HON'BLE SUPREME COURT IN THE CASE O F UNION OF INDIA AND ORS VS. DHARMENDRA TEXTILES PROCESSORS & ORS., REPORTED IN (2008) 306 ITR 277 (SC) AND HELD THAT IT GOES WITHOUT SAYING THAT FOR APPLICABILITY OF SECTI ON 271(L)(C) OF THE ACT, CONDITION STATED THEREIN MUST EXIST. TH E ABOVE SAID DECISION CAME UP FOR CONSIDERATION IN THE CASE OF COMMISSIONER OF INCOME TAX VS. RELIANCE PETROPRODUC TS PVT., LTD., REPORTED IN (2010) 322 ITR 158 (SC). ON READING OF SECTION 271(1)(C), THE HON'BLE SUPREME COURT POINTE D OUT THAT IN ORDER TO BRING THE CASE UNDER SECTION 271(1 )(C), THERE HAS TO BE CONCEALMENT OF THE PARTICULARS OF THE INC OME OF THE -: 19: - 19 ASSESSEE. SECONDLY, THE ASSESSEE MUST HAVE FURNISHE D INACCURATE PARTICULARS OF HIS INCOME. IN ORDER TO E XPOSE THE ASSESSEE TO PENALTY, UNLESS THE CASE IS STRICTLY CO VERED BY THE PROVISION, THE PENALTY PROVISION COULD NOT BE INVOK ED. THUS, THE HON'BLE SUPREME COURT POINTED OUT THAT A MERE M AKING OF CLAIM, WHICH IS NOT SUSTAINABLE IN LAW, BY ITSEL F, WOULD NOT AMOUNT TO FURNISHING OF INACCURATE PARTICULARS REGA RDING THE INCOME OF THE ASSESSEE. THE READING OF THE DECISION OF THE HON'BLE SUPREME COURT REFERRED TO ABOVE, THUS POINT S OUT THAT FOR SUSTAINING PENALTY, THE BONA FIDE EXPLANAT ION OF THE ASSESSEE MUST BE LOOKED AT, SO THAT THE CONTUMACIOU S CONDUCT OF THE ASSESSEE FOR THE PURPOSE OF SUSTAINI NG THE PENALTY WOULD BE TAKEN AS CONDITION THAT IS THE MAI N REQUIREMENT UNDER SECTION 271(L)(C) OF THE ACT. 9. THE RECENT DECISION OF THE HON'BLE SUPREME COURT I N THE CASE OF MAK DATA PRIVATE LIMITED VS. CIT, 358 I TR 593 (S.C.), WHILE CONSIDERING THE EXPLANATION TO SECTIO N 271(1)(C) THAT QUESTION WOULD BE WHETHER THE ASSESSEE HAD AFF ORDED THE EXPLANATION FOR CONCEALMENT OF PARTICULARS OF INCOM E OR FURNISHED INACCURATE PARTICULARS OF INCOME AND EXPL ANATION TO -: 20: - 20 SECTION 271(1)(C) RAISES A PRESUMPTION OF CONCEALME NT, WHEN A DIFFERENCE IS NOTICED BY THE ASSESSING OFFICER BETW EEN REPORTED AND ASSESSED INCOME, THE BURDEN IS THEN FOR THE ASS ESSEE TO SHOW BY COGENT AND RELIABLE EVIDENCE AND WHEN INITI AL BURDEN IS PLACED BY EXPLANATION, THE BURDEN IS DISCHARGED BY THE ASSESSEE. THE ONUS IS ON THE REVENUE TO SHOW THAT T HE AMOUNT IN QUESTION CONSTITUTED THEIR INCOME AND NOT OTHERW ISE. WE FIND THAT IN THE INSTANT CASE, THE ASSESSEE HAS MER ELY MADE A CLAIM FOR INDEXATION AND WHICH WAS RECTIFIED BY THE AO AND ASSESSEE HAS ADMITTED THE CALCULATION OF MISTAKE. T HEREFORE, NO PENALTY CAN BE LEVIED. WE CANCEL THE PENALTY. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 30 TH JULY, 2015. SD/- (B. C. MEENA) ACCOUNTANT MEMBER SD/- ( D.T.GARASIA) JUDICIAL MEMBER DATED : 30 TH JULY, 2015. CPU* -: 21: - 21 9.27